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COMPANY REGISTRATION NUMBER: 03067000
Commercial Catering Spares Limited
Financial Statements
31 December 2021
Commercial Catering Spares Limited
Financial Statements
Year ended 31st December 2021
Contents
Page
Strategic report
1
Directors' report
3
Independent auditor's report to the member
5
Income statement
9
Statement of financial position
10
Statement of changes in equity
11
Notes to the financial statements
12
Commercial Catering Spares Limited
Strategic Report
Year ended 31st December 2021
Introduction
The directors present the strategic report for the year ended 31 December 2021.
Business review
The shareholding and control of the company is held by GEV GroBkuchen-Ersatzteil-Vertrieb GmbH in Germany, which in turn is owned by REPA Group Holdings GmbH. Jonathan Booth and Alexander Wiegand served as directors for the entire year ending 31 December 2021. The principal activity of the company remains the sale of commercial catering equipment spare parts into the foodservice industry. In January 2022 the REPA Group was purchased in its entirety by PT Holdings LLC based in the USA. This now makes it part of the largest catering equipment spare parts group in the world and gives it even more access to different brands and increases its financial security even further to grow and develop the business.
Principal risks and uncertainties
The Covid pandemic still had a significant effect on the 2021 revenues, particularly in the first six months of the year. As the pandemic rules were relaxed the company has seen increased levels of business to above those of the pre-pandemic period, a trend which has continued in the first few months of 2022. An ongoing risk to the company is the failure of a major customer, however given the size of the company and the support from its group companies it would not represent a catastrophic event.
Analysis of development and performance including key performance indicators
The directors are pleased to report another profitable year, with substantially increased revenues, helped in part by the inclusion of the LF UK sales for part of the year. The delivery of the company's strategic objectives is monitored by the directors through Key Performance Indicators and the periodic review of various aspects of the company's operations. The directors consider the following Key Performance Indicators as appropriate measures for the delivery of its corporate strategy. Sales Revenue - growing sales revenue and growth in shareholders funds. Operating Profit - the continued reinvestment of operating profits, investing in additional storage space to facilitate increased stockholding. The company made a pre-tax profit of £467,552 (2020: £356,720) for the year from a turnover of £16,898,460 (2020: £10,010,044). At 31st December 2021 the company had net assets of £4,060,370 (2020: £3,681,653).
Future developments
The company is well positioned as part of the largest catering spares group in the world to supply an ever increasing range of spare parts, now including many more American brands, ever faster into the market place to help our service industry customers and ultimately their end user customers keep commercial kitchens wherever they may be fully functional with minimal down times.
This report was approved by the board of directors on 14th April 2022 and signed on behalf of the board by:
Mr J Booth
Director
Registered office:
C1-C4 Axis Point
Hill Top Road
Heywood
Lancashire
OL10 2RQ
Commercial Catering Spares Limited
Directors' Report
Year ended 31st December 2021
The directors present their report and the financial statements of the company for the year ended 31 December 2021 .
Principal activities
The principal activity of the company during the year was the sale of catering equipment spares.
Directors
The directors who served the company during the year were as follows:
Mr A Wiegand
Mr J Booth
Dividends
The directors do not recommend the payment of a dividend.
Going concern
The accounts have been prepared on a going concern basis, see note 3 for further details.
Disclosure of information in the strategic report
In accordance with section 414C(11) of the Companies Act 2006(Strategic Report and Directors' Report)Regulations 2013 the company's strategic report is shown separately on page 1 of the financial statements. The financial risk management objectives and policies of the company are found within the strategic report.
Directors' responsibilities statement
The directors are responsible for preparing the strategic report, directors' report and the financial statements in accordance with applicable law and regulations. Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and the profit or loss of the company for that period. In preparing these financial statements, the directors are required to: - select suitable accounting policies and then apply them consistently; - make judgments and accounting estimates that are reasonable and prudent; - prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business. The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. Auditor
Each of the persons who is a director at the date of approval of this report confirms that:
- so far as they are aware, there is no relevant audit information of which the company's auditor is unaware; and - they have taken all steps that they ought to have taken as a director to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information.
This report was approved by the board of directors on 14 April 2022 and signed on behalf of the board by:
Mr J Booth
Director
Registered office:
C1-C4 Axis Point
Hill Top Road
Heywood
Lancashire
OL10 2RQ
Commercial Catering Spares Limited
Independent Auditor's Report to the Member of Commercial Catering Spares Limited
Year ended 31st December 2021
Opinion
We have audited the financial statements of Commercial Catering Spares Limited (the 'company') for the year ended 31st December 2021 which comprise the income statement, statement of financial position, statement of changes in equity and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice). In our opinion the financial statements: - give a true and fair view of the state of the company's affairs as at 31st December 2021 and of its profit for the year then ended; - have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; - have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Other information
The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. The directors are responsible for the other information. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
- the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
- the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report. We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion: - adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or - the financial statements are not in agreement with the accounting records and returns; or - certain disclosures of directors' remuneration specified by law are not made; or - we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. The extent to which the audit was considered capable of detecting irregularities, including fraud Irregularities are instances of non-compliance with laws and regulations. The objectives of our audit are to obtain sufficient appropriate audit evidence regarding compliance with laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements, to perform audit procedures to help identify instances of non-compliance with other laws and regulations that may have a material effect on the financial statements, and to respond appropriately to identified or suspected non-compliance with laws and regulations identified during the audit. In relation to fraud, the objectives of our audit are to identify and assess the risk of material misstatement of the financial statements due to fraud, to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud through designing and implementing appropriate responses and to respond appropriately to fraud or suspected fraud identified during the audit. However, it is the primary responsibility of management, with the oversight of those charged with governance, to ensure that the entity's operations are conducted in accordance with the provisions of laws and regulations and for the prevention and detection of fraud. In identifying and assessing risks of material misstatement in respect of irregularities, including fraud, the audit engagement team: - obtained an understanding of the nature of the industry and sector, including the legal and regulatory framework that the company operates in and how the company is complying with the legal and regulatory framework; - inquired of management and those charged with governance, about their own identification and assessment of the risks of irregularities, including any known actual, suspected or alleged instances of fraud; - discussed matters about non-compliance with laws and regulations and how fraud might occur including assessment of how and where the financial statements may be susceptible to fraud. As a result of these procedures we consider the most significant laws and regulations that have a direct impact on the financial statements are FRS 102 and the Companies Act 2006. We performed audit procedures to detect non-compliances which may have a material impact on the financial statements which included reviewing financial statement disclosures. The audit engagement team identified the risk of management override of controls and revenue recognition as the areas where the financial statements were most susceptible to material misstatement due to fraud. Audit procedures performed included but were not limited to testing manual journal entries and other adjustments and evaluating the business rationale in relation to significant, unusual transactions and transactions entered into outside the normal course of business and testing a sample of revenue transactions recorded in the year to determine whether revenue had been recorded correctly. A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report. Use of our report
This report is made solely to the company's member, as a body, in accordance with chapter 3 of part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's member those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's member as a body, for our audit work, for this report, or for the opinions we have formed.
Stuart Whitehead FCA
(Senior Statutory Auditor)
For and on behalf of
Edwards Veeder LLP
Chartered accountants & statutory auditor
Alex House
260-268 Chapel Street
Salford
M3 5JZ
14 April 2022
Commercial Catering Spares Limited
Income Statement
Year ended 31st December 2021
2021
2020
Note
£
£
Turnover
4
16,898,460
10,010,044
Cost of sales
11,922,397
7,050,532
-------------
-------------
Gross profit
4,976,063
2,959,512
Distribution costs
932,472
560,031
Administrative expenses
3,743,264
2,506,087
Other operating income
5
151,149
447,806
------------
------------
Operating profit
6
451,476
341,200
Other interest receivable and similar income
10
16,076
15,520
------------
------------
Profit before taxation
467,552
356,720
Tax on profit
11
88,835
67,917
---------
---------
Profit for the financial year
378,717
288,803
---------
---------
All the activities of the company are from continuing operations.
The company has no other recognised items of income and expenses other than the results for the year as set out above.
Commercial Catering Spares Limited
Statement of Financial Position
31 December 2021
2021
2020
Note
£
£
£
Fixed assets
Intangible assets
12
36,988
87,418
Tangible assets
13
264,028
225,896
---------
---------
301,016
313,314
Current assets
Stocks
14
2,496,599
2,151,360
Debtors
15
4,614,269
2,565,733
Cash at bank and in hand
1,912,350
2,174,317
------------
------------
9,023,218
6,891,410
Creditors: amounts falling due within one year
16
5,256,099
3,507,128
------------
------------
Net current assets
3,767,119
3,384,282
------------
------------
Total assets less current liabilities
4,068,135
3,697,596
Provisions
Taxation including deferred tax
17
7,765
15,943
------------
------------
Net assets
4,060,370
3,681,653
------------
------------
Capital and reserves
Called up share capital
22
200
200
Capital redemption reserve
23
400
400
Profit and loss account
23
4,059,770
3,681,053
------------
------------
Shareholder funds
4,060,370
3,681,653
------------
------------
These financial statements were approved by the board of directors and authorised for issue on 14 April 2022 , and are signed on behalf of the board by:
Mr J Booth
Director
Company registration number: 03067000
Commercial Catering Spares Limited
Statement of Changes in Equity
Year ended 31st December 2021
Called up share capital
Capital redemption reserve
Profit and loss account
Total
£
£
£
£
At 1st January 2020
200
400
3,392,250
3,392,850
Profit for the year
288,803
288,803
----
----
------------
------------
Total comprehensive income for the year
288,803
288,803
At 31st December 2020
200
400
3,681,053
3,681,653
Profit for the year
378,717
378,717
----
----
------------
------------
Total comprehensive income for the year
378,717
378,717
----
----
------------
------------
At 31st December 2021
200
400
4,059,770
4,060,370
----
----
------------
------------
Commercial Catering Spares Limited
Notes to the Financial Statements
Year ended 31st December 2021
1. General information
The company is a private company limited by shares, registered in England and Wales. The address of the registered office is C1-C4 Axis Point, Hill Top Road, Heywood, Lancashire, OL10 2RQ.
2. Statement of compliance
These financial statements have been prepared in compliance with FRS 102, 'The Financial Reporting Standard applicable in the UK and the Republic of Ireland'.
3. Accounting policies
Basis of preparation
The financial statements have been prepared on the historical cost basis, as modified by the revaluation of certain financial assets and liabilities and investment properties measured at fair value through profit or loss.
The financial statements are prepared in sterling, which is the functional currency of the entity.
Debtors
Short term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
Going concern
The financial statements have been prepared on a going concern basis which the directors consider to be appropriate for the following reasons. The directors have prepared cash flow forecasts for a period of 18 months from the date of approval of these financial statements which indicate that the company will have sufficient funds to meet its liabilities as they fall due for that period. Whilst the Company is profitable and has net current assets, the forecasts are dependent on GEV GroBkuchen-Ersatzteil-Vertrieb GmbH providing funding, if required. The parent company, GEV GroBkuchen-Ersatzteil-Vertrieb GmbH, has indicated its intention to support the Company for the period covered by the forecast. As with any company placing reliance on other group entities for financial support, the directors acknowledge that there can be no certainty that this will continue although, at the date of approval of these financial statements, they have no reason to believe that it will not do so. Consequently, the directors are confident that the company will have sufficient funds to continue to meet its liabilities as they fall due for at least 18 months from the date of approval of the financial statements and therefore have prepared the financial statements on a going concern basis.
Cash and cash equivalents
Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.
Creditors
Short term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
Finance costs
Finance costs are charged to the Income Statement over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.
Dividends
Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting. Dividends on shares recognised as liabilities are recognised as expenses and classified within interest payable.
Consolidation
These financial statements present the results of the company only. The Company's ultimate parent undertaking, GEV GroBkuchen-Ersatzteil-Vertrieb GmbH includes the Company in its consolidated financial statements. The consolidated financial statements of GEV GroBkuchen-Ersatzteil-Vertrieb GmbH are prepared in accordance with International Financial Reporting Standards as adopted by the EU and are available to the public and may be obtained from Gadastr.4, 85232 Bergkirchen, Germany. In these financial statements, the company is considered to be a qualifying entity (for the purposes of this FRS) and has applied the exemptions available under FRS 102 in respect of the following disclosures; Reconciliation of the number of shares outstanding from the beginning to end of the period; Cash Flow Statement and related notes; and Key Management Personnel compensation. As the consolidated financial statements of GEV GroBkuchen-Ersatzteil-Vertrieb GmbH include the disclosures equivalent to those required by FRS 102, the company has also taken advantage of the exemptions available in respect of the following disclosures; Certain disclosures required by FRS 102.26 Share Based Payments; and, Certain disclosures required by FRS 102.11 Basic Financial Instruments and FRS 102.12 Other Financial Instrument Issues in respect of financial instruments not falling within the fair value accounting rules of Paragraph 36(4) of Schedule 1. The accounting policies set out below have, unless otherwise stated, been applied consistently to all periods presented in these financial statements. Judgements made by the directors, in the application of these accounting policies that have significant effect on the financial statements and estimates with a significant risk of material adjustment in the next financial year are discussed below.
Interest income
Interest income is recognised in the Income Statement Income using the effective interest method.
Borrowing costs
All borrowing costs are recognised in the Income Statement in the year in which they are incurred.
Judgements and key sources of estimation uncertainty
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported. These estimates and judgements are continually reviewed and are based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The judgements and estimations that management has made in the process of applying the entity's accounting policies and that have the most significant effect on the amounts recognised in the financial statements are as follows: Stock provisions. The stock provision is determined by ageing stock appropriately into categories based on management's knowledge and experience. An appropriate level of provision is then applied based on what management believe the recoverable amount of the stock to be.
Revenue recognition
Turnover is measured at the fair value of the consideration received or receivable and represents amounts receivable for goods supplied and services rendered, stated net of discounts and of Value Added Tax. Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have transferred to the buyer, usually on despatch of the goods, the amount of revenue can be measured reliably, it is probable that the associated economic benefits will flow to the entity, and the costs incurred or to be incurred in respect of the transactions can be measured reliably.
Taxation
The tax expense for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively. The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the company operates and generates income. Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the reporting date, except that: The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met. Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.
Foreign currencies
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions. At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined. Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Income Statement except when deferred in other comprehensive income as qualifying cash flow hedges.
Operating leases
Rentals paid under operating leases are charged to the Income Statement on a straight line basis over the lease term.
Intangible assets
Intangible assets are initially recorded at cost, and are subsequently stated at cost less any accumulated amortisation and impairment losses. Any intangible assets carried at revalued amounts, are recorded at the fair value at the date of revaluation, as determined by reference to an active market, less any subsequent accumulated amortisation and subsequent accumulated impairment losses. Intangible assets acquired as part of a business combination are only recognised separately from goodwill when they arise from contractual or other legal rights, are separable, the expected future economic benefits are probable and the cost or value can be measured reliably.
Amortisation
Amortisation is calculated so as to write off the cost of an asset, less its estimated residual value, over the useful life of that asset as follows:
Computer Software
-
33% straight line
If there is an indication that there has been a significant change in amortisation rate, useful life or residual value of an intangible asset, the amortisation is revised prospectively to reflect the new estimates.
Tangible assets
Tangible assets are initially recorded at cost, and subsequently stated at cost less any accumulated depreciation and impairment losses. Any tangible assets carried at revalued amounts are recorded at the fair value at the date of revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses.
Depreciation
Depreciation is calculated so as to write off the cost or valuation of an asset, less its residual value, over the useful economic life of that asset as follows:
Plant and Machinery
-
25% reducing balance
Fixtures and Fittings
-
15% reducing balance
Motor Vehicles
-
25% reducing balance
If the estimated residual value of an asset is materially less than its value in the financial statements then additional depreciation is charged to reflect this.
Impairment of fixed assets
A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date. For the purposes of impairment testing, when it is not possible to estimate the recoverable amount of an individual asset, an estimate is made of the recoverable amount of the cash-generating unit to which the asset belongs. The cash-generating unit is the smallest identifiable group of assets that includes the asset and generates cash inflows that largely independent of the cash inflows from other assets or groups of assets. For impairment testing of goodwill, the goodwill acquired in a business combination is, from the acquisition date, allocated to each of the cash-generating units that are expected to benefit from the synergies of the combination, irrespective of whether other assets or liabilities of the company are assigned to those units.
Stocks
Stocks are measured at the lower of cost and net realisable value being the estimated selling price less costs to complete and sell. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing the stock to its present location and condition.
Government grants
Government grants are recognised at the fair value of the asset received or receivable. Grants are not recognised until there is reasonable assurance that the company will comply with the conditions attaching to them and the grants will be received. Government grants are recognised using the accrual model and the performance model. Under the accrual model, government grants relating to revenue are recognised on a systematic basis over the periods in which the company recognises the related costs for which the grant is intended to compensate. Grants that are receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the entity with no future related costs are recognised in income in the period in which it becomes receivable. Grants relating to assets are recognised in income on a systematic basis over the expected useful life of the asset. Where part of a grant relating to an asset is deferred, it is recognised as deferred income and not deducted from the carrying amount of the asset. Under the performance model, where the grant does not impose specified future performance-related conditions on the recipient, it is recognised in income when the grant proceeds are received or receivable. Where the grant does impose specified future performance-related conditions on the recipient, it is recognised in income only when the performance-related conditions have been met. Where grants received are prior to satisfying the revenue recognition criteria, they are recognised as a liability.
Provisions
Provisions are made where an event has taken place that gives the company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation. Provisions are charged as an expense to the Income Statement in the year that the company becomes aware of the obligation, and are measured at the best estimate at the Balance Sheet date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties. When payments are eventually made, they are charged to the provisions carried in the Statement of Financial Position.
Financial instruments
The company only enters into basic financial instruments transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in non-puttable ordinary shares. Debt instruments (other than those wholly repayable or receivable within one year),including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or financed at a rate of interest that is not a market rate or in case of an out-right short-term loan not at market rate, the financial asset or liability is measured, initially, at the present value of the future cash flow discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost. Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Profit and Loss Account. For financial assets measured at amortised cost, the impairment loss is measured as the difference between an asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If a financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract. For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount and best estimate of the recoverable amount, which is an approximation of the amount that the company would receive for the asset if it were to be sold at the balance sheet date.
Pensions defined contribution plans
The company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the company pays fixed contributions into a separate entity. Once the contributions have been paid the company has no further payment obligations. The contributions are recognised as an expense in the Income Statement when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of Financial Position. The assets of the plan are held separately from the company in independently administered funds.
4. Turnover
Turnover arises from:
2021
2020
£
£
Sale of goods
16,898,460
10,010,044
-------------
-------------
The turnover is attributable to the one principal activity of the company. An analysis of turnover by the geographical markets that substantially differ from each other is given below:
2021
2020
£
£
United Kingdom
16,574,713
9,750,458
Overseas
323,747
259,586
-------------
-------------
16,898,460
10,010,044
-------------
-------------
5. Other operating income
2021
2020
£
£
Government grant income
146,752
447,806
Other operating income
4,397
---------
---------
151,149
447,806
---------
---------
6. Operating profit
Operating profit or loss is stated after charging/crediting:
2021
2020
£
£
Amortisation of intangible assets
60,606
49,701
Depreciation of tangible assets
49,228
52,616
(Gains)/loss on disposal of tangible assets
( 5,330)
11,372
Impairment of trade debtors
100,001
75,710
Operating lease rentals
83,786
78,979
Foreign exchange differences
( 54,768)
14,554
---------
--------
7. Auditor's remuneration
2021
2020
£
£
Fees payable for the audit of the financial statements
17,268
16,000
--------
--------
8. Staff costs
The average number of persons employed by the company during the year, including the directors, amounted to:
2021
2020
No.
No.
Administrative staff
55
55
Warehouse staff
15
14
----
----
70
69
----
----
The aggregate payroll costs incurred during the year, relating to the above, were:
2021
2020
£
£
Wages and salaries
1,988,365
1,661,929
Social security costs
178,560
164,455
Other pension costs
59,386
55,359
------------
------------
2,226,311
1,881,743
------------
------------
9. Directors' remuneration
The directors' aggregate remuneration in respect of qualifying services was:
2021
2020
£
£
Remuneration
109,207
117,351
Company contributions to defined contribution pension plans
10,000
10,000
---------
---------
119,207
127,351
---------
---------
The number of directors who accrued benefits under company pension plans was as follows:
2021
2020
No.
No.
Defined contribution plans
1
1
----
----
The highest paid director received remuneration of £109,207 (2020: £117,351). This includes the cash equivalent of directors benefits-in-kind. The value of the company's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to £10,000 (2020: £10,000)
10. Other interest receivable and similar income
2021
2020
£
£
Interest on cash and cash equivalents
16,076
15,520
--------
--------
11. Tax on profit
Major components of tax expense
2021
2020
£
£
Current tax:
UK current tax expense
97,013
65,653
Deferred tax:
Origination and reversal of timing differences
( 8,178)
2,264
--------
--------
Tax on profit
88,835
67,917
--------
--------
Reconciliation of tax expense
The tax assessed on the profit on ordinary activities for the year is the same as (2020: higher than) the standard rate of corporation tax in the UK of 19 % (2020: 19 %).
2021
2020
£
£
Profit on ordinary activities before taxation
467,552
356,720
---------
---------
Profit on ordinary activities by rate of tax
88,835
67,776
Effect of expenses not deductible for tax purposes
293
182
Effect of capital allowances and depreciation
7,962
Other tax adjustment to increase/(decrease) tax liability
(77)
(41)
Deferred tax adjustment
( 8,178)
---------
---------
Tax on profit
88,835
67,917
---------
---------
12. Intangible assets
Computer Software
£
Cost
At 1st January 2021
178,405
Additions
10,176
---------
At 31st December 2021
188,581
---------
Amortisation
At 1st January 2021
90,987
Charge for the year
60,606
---------
At 31st December 2021
151,593
---------
Carrying amount
At 31st December 2021
36,988
---------
At 31st December 2020
87,418
---------
13. Tangible assets
Plant and machinery
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
Cost
At 1st January 2021
10,309
208,826
154,554
373,689
Additions
10,500
9,281
92,049
111,830
Disposals
( 10,309)
( 47,131)
( 57,440)
--------
---------
---------
---------
At 31st December 2021
10,500
218,107
199,472
428,079
--------
---------
---------
---------
Depreciation
At 1st January 2021
8,671
67,942
71,180
147,793
Charge for the year
875
21,578
26,775
49,228
Disposals
( 8,671)
( 24,299)
( 32,970)
--------
---------
---------
---------
At 31st December 2021
875
89,520
73,656
164,051
--------
---------
---------
---------
Carrying amount
At 31st December 2021
9,625
128,587
125,816
264,028
--------
---------
---------
---------
At 31st December 2020
1,638
140,884
83,374
225,896
--------
---------
---------
---------
14. Stocks
2021
2020
£
£
Raw materials and consumables
2,496,599
2,151,360
------------
------------
15. Debtors
2021
2020
£
£
Trade debtors
3,994,833
1,985,592
Amounts owed by group undertakings
555,426
539,390
Prepayments and accrued income
48,758
35,324
Corporation tax repayable
12,822
Other debtors
2,430
5,427
------------
------------
4,614,269
2,565,733
------------
------------
An impairment loss of £197,266 (2020: £114,425) was recognised against trade debtors. Amounts owed by fellow group undertakings are as follows; GEV GroBkuchen-Ersatzteil-Vertrieb GmbH £555,426 (2020: £539,390) This amount is under a secured loan agreement, interest of 2% p.a. is owed on the outstanding amount of the loan from the date the loan is advanced. Interest is calculated on the basis of a calendar year of 365 days (to the precise day) and is repayable on demand.
16. Creditors: amounts falling due within one year
2021
2020
£
£
Bank loans and overdrafts
8,203
Trade creditors
2,464,886
1,523,757
Amounts owed to group undertakings
1,343,707
1,475,119
Accruals and deferred income
1,181,678
145,657
Corporation tax
65,653
Social security and other taxes
241,508
279,433
Other creditors
24,320
9,306
------------
------------
5,256,099
3,507,128
------------
------------
17. Provisions
Deferred tax (note 18)
£
At 1st January 2021
15,943
Charge against provision
( 8,178)
--------
At 31st December 2021
7,765
--------
18. Deferred tax
The deferred tax included in the statement of financial position is as follows:
2021
2020
£
£
Included in provisions (note 17)
7,765
15,943
-------
--------
The deferred tax account consists of the tax effect of timing differences in respect of:
2021
2020
£
£
Deferred tax - other timing differences
7,765
15,943
-------
--------
19. Employee benefits
Defined contribution plans
The amount recognised in profit or loss as an expense in relation to defined contribution plans was £ 49,386 (2020: £ 45,359 ).
20. Government grants
The amounts recognised in the financial statements for government grants are as follows:
2021
2020
£
£
Recognised in other operating income:
Government grants recognised directly in income
146,752
447,806
---------
---------
21. Financial instruments
The carrying amount for each category of financial instrument is as follows:
2021
2020
£
£
Financial assets that are debt instruments measured at amortised cost
Trade debtors
3,994,833
1,985,592
Other debtors
2,430
5,427
Amounts owed by fellow group undertakings
555,426
539,390
Cash at bank and in hand
1,912,350
2,166,114
------------
------------
6,465,039
4,696,523
------------
------------
Financial liabilities measured at amortised cost
Trade creditors
2,464,886
(1,523,758)
Amounts owed to group undertakings
1,343,707
(1,475,119)
Other creditors and accruals
1,205,998
(154,963)
------------
------------
5,014,591
( 3,153,840)
------------
------------
Financial assets measured at amortised cost comprise of all current debtors (other than prepayments) and cash and cash equivalent balances. Financial liabilities measured at amortised cost comprise of all current and non-current liabilities (other than tax liabilities and finance lease liabilities).
22. Called up share capital
Authorised share capital
2021
2020
No.
£
No.
£
Ordinary shares of £ 1 each
1,000
1,000
1,000
1,000
-------
-------
-------
-------
Issued, called up and fully paid
2021
2020
No.
£
No.
£
Ordinary shares of £ 1 each
200
200
200
200
----
----
----
----
23. Reserves
Capital redemption reserve - This reserve records the nominal value of shares repurchased by the company. Profit and loss account - This reserve records retained earnings and accumulated losses.
24. Operating leases
The total future minimum lease payments under non-cancellable operating leases are as follows:
2021
2020
£
£
Not later than 1 year
83,036
83,036
Later than 1 year and not later than 5 years
83,036
--------
---------
83,036
166,072
--------
---------
25. Related party transactions
As at the year-end £426,224 (2020:£1,272,027) was owed to GEV GroBkuchen-Ersatzteil-Vertrieb GmbH and £916,386 (2020:£203,092) was owed to L.F.SPA A Socio Unico. £42,572 (2020:£33,496) was owed from GEV GroBkuchen-Ersatzteil-Vertrieb GmbH and £21,947 (2020:£21,843) was owed from L.F.SPA A Socio Unico. During the year purchases of £1,280,846 (2020:£1,033,315) were made and sales of £261,542 (2020:£231,671) were made between the Company and GEV GroBkuchen-Ersatzteil-Vertrieb GmbH and purchases of £2,152,412 (2020:£248,657) and sales of £21,947 (2020:£Nil) were made between the company and L.F.SPA A Socio Unico. Included in accruals was £437,980 (2020:£Nil) management charges due to GEV GroBkuchen-Ersatzteil-Vertrieb GmbH and £345,878 (2020:£Nil) management charges due to L.F.SPA A Socio Unico as at 31 December 2021. During the year rentals of £83,786 (2020:£78,979) were paid to Commercial Catering Spares Retirement Benefit Scheme, which is the personal pension scheme of Mr. J. Booth and Mrs. T. Booth. Key management personnel The directors are considered the key management. See note 9 in relation to directors remuneration.
26. Controlling party
The immediate and ultimate parent company of Commercial Catering Spares Limited is GEV GroBkuchen-Ersatzteil-Vertrieb GmbH, a company incorporated in Germany. Its group financial statements can be obtained from Gadastr.4, 85232 Bergkirchen, Germany.