REGISTERED NUMBER: 04246652 (England and Wales) |
GROUP STRATEGIC REPORT, REPORT OF THE DIRECTOR AND |
CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JANUARY 2022 |
FOR |
SECOND CHANCE GROUP LIMITED |
REGISTERED NUMBER: 04246652 (England and Wales) |
GROUP STRATEGIC REPORT, REPORT OF THE DIRECTOR AND |
CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JANUARY 2022 |
FOR |
SECOND CHANCE GROUP LIMITED |
SECOND CHANCE GROUP LIMITED (REGISTERED NUMBER: 04246652) |
CONTENTS OF THE CONSOLIDATED FINANCIAL STATEMENTS |
for the year ended 31 January 2022 |
Page |
Company Information | 1 |
Group Strategic Report | 2 |
Report of the Director | 4 |
Report of the Independent Auditors | 6 |
Consolidated Income Statement | 9 |
Consolidated Other Comprehensive Income | 10 |
Consolidated Balance Sheet | 11 |
Company Balance Sheet | 12 |
Consolidated Statement of Changes in Equity | 13 |
Company Statement of Changes in Equity | 14 |
Consolidated Cash Flow Statement | 15 |
Notes to the Consolidated Cash Flow Statement | 16 |
Notes to the Consolidated Financial Statements | 17 |
SECOND CHANCE GROUP LIMITED |
COMPANY INFORMATION |
for the year ended 31 January 2022 |
DIRECTOR: |
SECRETARY: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
AUDITORS: |
Statutory Auditors |
17 St Peters Place |
Fleetwood |
Lancashire |
FY7 6EB |
SECOND CHANCE GROUP LIMITED (REGISTERED NUMBER: 04246652) |
GROUP STRATEGIC REPORT |
for the year ended 31 January 2022 |
The director presents his strategic report of the company and the group for the year ended 31 January 2022. |
Second Chance Group Limited has not traded during the year under review. Second Chance Limited is one of the largest wholesale sports goods suppliers in EMEA. It is a family run business where the close family have all helped to contribute towards the success of the company. |
REVIEW OF BUSINESS |
During the year the group has consolidated its trading position and turnover has remained at the level achieved last year. The trading company benefitted from the growth in the leisure market during the Covid pandemic as consumers looked for new hobbies that they were able to do within the restrictions that were introduced. For the year ended 31st January 2022 the following key performance indicators are presented: |
2022 | 2021 | Change |
£ | £ | % |
Turnover | 12,983 | 12,930 | 0.4% |
Gross profit | 3,943 | 4,147 | (4.9%) |
Profit before tax | 2,373 | 2,893 | (18.0%) |
Whilst turnover levels have been maintained, gross profit levels have been depressed, largely as a result of significant increases in the freight shipping costs. Profit before tax is lower this year, reflecting increases in most of the overheads incurred. |
Consolidated balance sheet ratios: |
2022 | 2021 | Change |
Current ratio | 6.5 | 4.5 | 2.0 |
Debtor days | 38 | 42 | (4 days) |
The current ratio has risen this year as the balance sheet has strengthened from the profits that have been made within the group. Debtor days have fallen slightly which indicates that there is no problem with cash flow and that customers are paying us within a reasonable period. |
SECOND CHANCE GROUP LIMITED (REGISTERED NUMBER: 04246652) |
GROUP STRATEGIC REPORT |
for the year ended 31 January 2022 |
PRINCIPAL RISKS AND UNCERTAINTIES |
Trading company operational risks |
The company sources most of its products from China. There are potential political and exchange rate risks in this area over which the company has no control. This could impact on the price and supply of stocks if the situation in that region became volatile. |
The company acts as distributor for a number of manufacturers. These agreements are for fixed periods and, if not renewed, the range of products offered by the company will reduce, which could have an impact on turnover. The directors are constantly seeking new manufacturers to work with and new product ranges are being taken on regularly. Initially, the company focussed solely on golf products but in recent years has expanded into products for cycling and fishing. |
The company has benefitted in recent years from the boom in the leisure market which resulted from the Covid pandemic. However, as the pandemic restrictions have been lifted, the growth in sales has slowed. The UK market now faces the cost of living crisis and a potential recession and consumers are likely to reduce spending on unnecessary spending, such as leisure goods. The directors feel that having a wide range of products available over different sports they are mitigating some of this risk. |
Trading company financial risks |
The company does a significant amount of its trade in currencies other than Sterling and a fall in value of Sterling could affect the profitability of the company. |
ON BEHALF OF THE BOARD: |
SECOND CHANCE GROUP LIMITED (REGISTERED NUMBER: 04246652) |
REPORT OF THE DIRECTOR |
for the year ended 31 January 2022 |
The director presents his report with the financial statements of the company and the group for the year ended 31 January 2022. |
DIVIDENDS |
Interim dividends per share were paid during the year as follows: |
A Ordinary £1 | - | £4057.15 | - 30 April 2021 |
B Ordinary £1 | - | £6914.30 | - 30 April 2021 |
C Ordinary £1 | - | £6080 | - 30 April 2021 |
D Ordinary £1 | - | £5920 | - 30 April 2021 |
The total distribution of dividends for the year ended 31 January 2022 will be £ 564,001 . |
Interim dividends were declared on 30th April 2021 as follows: |
Class of Share |
Dividend per Share |
A Ordinary | £4,057.15 |
B Ordinary | £6,914.30 |
C Ordinary | £6,080.00 |
D Ordinary | £5,920.00 |
FUTURE DEVELOPMENTS |
The directors continue to investigate new product ranges that they could add to their catalogue, whilst maintaining their market presence with their existing goods. |
EVENTS SINCE THE END OF THE YEAR |
Information relating to events since the end of the year is given in the notes to the financial statements. |
DIRECTOR |
STATEMENT OF DIRECTOR'S RESPONSIBILITIES |
The director is responsible for preparing the Group Strategic Report, the Report of the Director and the financial statements in accordance with applicable law and regulations. |
Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless he is satisfied that they give a true and fair view of the state of affairs of the company and the group and of the profit or loss of the group for that period. In preparing these financial statements, the director is required to: |
- | select suitable accounting policies and then apply them consistently; |
- | make judgements 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 director is responsible for keeping adequate accounting records that are sufficient to show and explain the company's and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group and enable him to ensure that the financial statements comply with the Companies Act 2006. He is also responsible for safeguarding the assets of the company and the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. |
SECOND CHANCE GROUP LIMITED (REGISTERED NUMBER: 04246652) |
REPORT OF THE DIRECTOR |
for the year ended 31 January 2022 |
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS |
So far as the director is aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the group's auditors are unaware, and he has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the group's auditors are aware of that information. |
AUDITORS |
The auditors, Jones Harris Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting. |
ON BEHALF OF THE BOARD: |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
SECOND CHANCE GROUP LIMITED |
Opinion |
We have audited the financial statements of Second Chance Group Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 January 2022 which comprise the Consolidated Income Statement, Consolidated Other Comprehensive Income, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Cash Flow Statement and Notes to the Consolidated Cash Flow Statement, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 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 group's and of the parent company affairs as at 31 January 2022 and of the group's profit for the year then ended; |
- | have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and |
- | have been prepared in accordance with the requirements of the Companies Act 2006. |
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 Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the group 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 director's 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 group's and the parent 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 director with respect to going concern are described in the relevant sections of this report. |
Other information |
The director is responsible for the other information. The other information comprises the information in the Group Strategic Report and the Report of the Director, but does not include the financial statements and our Report of the Auditors thereon. |
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 this gives rise to a material misstatement in the financial statements themselves. 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 Group Strategic Report and the Report of the Director for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Group Strategic Report and the Report of the Director have been prepared in accordance with applicable legal requirements. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
SECOND CHANCE GROUP LIMITED |
Matters on which we are required to report by exception |
In the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Report of the Director. |
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion: |
- | adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or |
- | the parent company financial statements are not in agreement with the accounting records and returns; or |
- | certain disclosures of director's remuneration specified by law are not made; or |
- | we have not received all the information and explanations we require for our audit. |
Responsibilities of director |
As explained more fully in the Statement of Director's Responsibilities set out on page four, the director is 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 director determines 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 director is responsible for assessing the group's and the parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the director either intends to liquidate the group or the parent company or to cease operations, or has no realistic alternative but to do so. |
Auditors' 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 a Report of the Auditors 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 our procedures are capable of detecting irregularities, including fraud is detailed below: |
Audit procedures performed in order to mitigate the risks highlighted include the following: |
- Discussions with management, including consideration of known or suspected instances of non-compliance with laws and regulation and fraud. |
-Evaluation and testing of the effectiveness of the management's controls designed to prevent and detect irregularities. |
-Reviewing key correspondence with regulatory authorities in relation to compliance with relevant regulations. |
-Challenging assumptions and judgements made by the management as well as explanations given. |
-Identifying and testing journal entries, in particular those posted around the year end. |
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 Report of the Auditors. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
SECOND CHANCE GROUP LIMITED |
Use of our report |
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in a Report of the Auditors and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed. |
for and on behalf of |
Statutory Auditors |
17 St Peters Place |
Fleetwood |
Lancashire |
FY7 6EB |
SECOND CHANCE GROUP LIMITED (REGISTERED NUMBER: 04246652) |
CONSOLIDATED |
INCOME STATEMENT |
for the year ended 31 January 2022 |
2022 | 2021 |
Notes | £ | £ |
TURNOVER | 12,983,474 | 12,930,902 |
Cost of sales | 9,040,319 | 8,783,874 |
GROSS PROFIT | 3,943,155 | 4,147,028 |
Administrative expenses | 1,654,608 | 1,320,258 |
2,288,547 | 2,826,770 |
Other operating income | 79,784 | 62,574 |
OPERATING PROFIT | 5 | 2,368,331 | 2,889,344 |
Interest receivable and similar income | 5,931 | 5,926 |
2,374,262 | 2,895,270 |
Amounts written off investments | 6 | 100 | - |
2,374,162 | 2,895,270 |
Interest payable and similar expenses | 7 | 1,646 | 2,532 |
PROFIT BEFORE TAXATION | 2,372,516 | 2,892,738 |
Tax on profit | 8 | 467,714 | 550,490 |
PROFIT FOR THE FINANCIAL YEAR |
Profit attributable to: |
Owners of the parent | 1,904,802 | 2,342,248 |
SECOND CHANCE GROUP LIMITED (REGISTERED NUMBER: 04246652) |
CONSOLIDATED |
OTHER COMPREHENSIVE INCOME |
for the year ended 31 January 2022 |
2022 | 2021 |
Notes | £ | £ |
PROFIT FOR THE YEAR | 1,904,802 | 2,342,248 |
OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE INCOME FOR THE YEAR |
1,904,802 |
2,342,248 |
Total comprehensive income attributable to: |
Owners of the parent | 1,904,802 | 2,342,248 |
SECOND CHANCE GROUP LIMITED (REGISTERED NUMBER: 04246652) |
CONSOLIDATED BALANCE SHEET |
31 January 2022 |
2022 | 2021 |
Notes | £ | £ |
FIXED ASSETS |
Tangible assets | 11 | 462,600 | 528,829 |
Investments | 12 | - | 100 |
462,600 | 528,929 |
CURRENT ASSETS |
Stocks | 13 | 2,956,100 | 2,096,973 |
Debtors | 14 | 1,681,144 | 1,955,376 |
Cash at bank | 2,442,712 | 1,832,251 |
7,079,956 | 5,884,600 |
CREDITORS |
Amounts falling due within one year | 15 | (1,087,446 | ) | (1,299,401 | ) |
NET CURRENT ASSETS | 5,992,510 | 4,585,199 |
TOTAL ASSETS LESS CURRENT LIABILITIES |
6,455,110 |
5,114,128 |
CREDITORS |
Amounts falling due after more than one year | 16 | (443 | ) | (4,867 | ) |
PROVISIONS FOR LIABILITIES | 19 | (32,648 | ) | (28,043 | ) |
NET ASSETS | 6,422,019 | 5,081,218 |
CAPITAL AND RESERVES |
Called up share capital | 20 | 100 | 100 |
Retained earnings | 21 | 6,421,919 | 5,081,118 |
SHAREHOLDERS' FUNDS | 6,422,019 | 5,081,218 |
The financial statements were approved by the director and authorised for issue on 2 September 2022 and were signed by: |
P K Daniels - Director |
SECOND CHANCE GROUP LIMITED (REGISTERED NUMBER: 04246652) |
COMPANY BALANCE SHEET |
31 January 2022 |
2022 | 2021 |
Notes | £ | £ |
FIXED ASSETS |
Tangible assets | 11 |
Investments | 12 |
CURRENT ASSETS |
Debtors | 14 |
Cash at bank |
CREDITORS |
Amounts falling due within one year | 15 | ( |
) |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
CAPITAL AND RESERVES |
Called up share capital | 20 |
Retained earnings |
SHAREHOLDERS' FUNDS |
Company's profit for the financial year | 1,593,048 | 380,000 |
The financial statements were approved by the director and authorised for issue on |
SECOND CHANCE GROUP LIMITED (REGISTERED NUMBER: 04246652) |
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY |
for the year ended 31 January 2022 |
Called up |
share | Retained | Total |
capital | earnings | equity |
£ | £ | £ |
Balance at 1 February 2020 | 190 | 3,118,870 | 3,119,060 |
Changes in equity |
Issue of share capital | (90 | ) | - | (90 | ) |
Dividends | - | (380,000 | ) | (380,000 | ) |
Total comprehensive income | - | 2,342,248 | 2,342,248 |
Balance at 31 January 2021 | 100 | 5,081,118 | 5,081,218 |
Changes in equity |
Dividends | - | (564,001 | ) | (564,001 | ) |
Total comprehensive income | - | 1,904,802 | 1,904,802 |
Balance at 31 January 2022 | 100 | 6,421,919 | 6,422,019 |
SECOND CHANCE GROUP LIMITED (REGISTERED NUMBER: 04246652) |
COMPANY STATEMENT OF CHANGES IN EQUITY |
for the year ended 31 January 2022 |
Called up |
share | Retained | Total |
capital | earnings | equity |
£ | £ | £ |
Balance at 1 February 2020 |
Changes in equity |
Dividends | - | ( |
) | ( |
) |
Total comprehensive income | - |
Balance at 31 January 2021 |
Changes in equity |
Dividends | - | ( |
) | ( |
) |
Total comprehensive income | - |
Balance at 31 January 2022 |
SECOND CHANCE GROUP LIMITED (REGISTERED NUMBER: 04246652) |
CONSOLIDATED CASH FLOW STATEMENT |
for the year ended 31 January 2022 |
2022 | 2021 |
Notes | £ | £ |
Cash flows from operating activities |
Cash generated from operations | 1 | 1,853,886 | 2,624,799 |
Interest paid | (347 | ) | (1,791 | ) |
Interest element of hire purchase payments paid | (1,299 | ) | (741 | ) |
Tax paid | (763,062 | ) | (213,497 | ) |
Net cash from operating activities | 1,089,178 | 2,408,770 |
Cash flows from investing activities |
Purchase of tangible fixed assets | (15,043 | ) | (280,110 | ) |
Sale of tangible fixed assets | - | 6,350 |
Sale of fixed asset investments | 100 | - |
Interest received | 5,931 | 5,926 |
Net cash from investing activities | (9,012 | ) | (267,834 | ) |
Cash flows from financing activities |
Capital repayments in year | (3,039 | ) | (3,143 | ) |
Amount introduced by directors | 171,354 | 203,600 |
Amount withdrawn by directors | (74,019 | ) | (302,934 | ) |
Equity dividends paid | (564,001 | ) | (380,000 | ) |
Net cash from financing activities | (469,705 | ) | (482,477 | ) |
Increase in cash and cash equivalents | 610,461 | 1,658,459 |
Cash and cash equivalents at beginning of year |
2 |
1,832,251 |
173,792 |
Cash and cash equivalents at end of year | 2 | 2,442,712 | 1,832,251 |
SECOND CHANCE GROUP LIMITED (REGISTERED NUMBER: 04246652) |
NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT |
for the year ended 31 January 2022 |
1. | RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS |
2022 | 2021 |
£ | £ |
Profit before taxation | 2,372,516 | 2,892,738 |
Depreciation charges | 35,856 | 33,710 |
Loss/(profit) on disposal of fixed assets | 45,416 | (439 | ) |
Finance costs | 1,646 | 2,532 |
Finance income | (5,931 | ) | (5,926 | ) |
2,449,503 | 2,922,615 |
Increase in stocks | (859,127 | ) | (108,260 | ) |
Decrease/(increase) in trade and other debtors | 170,012 | (603,981 | ) |
Increase in trade and other creditors | 93,498 | 414,425 |
Cash generated from operations | 1,853,886 | 2,624,799 |
2. | CASH AND CASH EQUIVALENTS |
The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts: |
Year ended 31 January 2022 |
31/1/22 | 1/2/21 |
£ | £ |
Cash and cash equivalents | 2,442,712 | 1,832,251 |
Year ended 31 January 2021 |
31/1/21 | 1/2/20 |
£ | £ |
Cash and cash equivalents | 1,832,251 | 232,128 |
Bank overdrafts | - | (58,336 | ) |
1,832,251 | 173,792 |
3. | ANALYSIS OF CHANGES IN NET FUNDS |
At 1/2/21 | Cash flow | At 31/1/22 |
£ | £ | £ |
Net cash |
Cash at bank | 1,832,251 | 610,461 | 2,442,712 |
1,832,251 | 610,461 | 2,442,712 |
Debt |
Finance leases | (8,641 | ) | 3,039 | (5,602 | ) |
(8,641 | ) | 3,039 | (5,602 | ) |
Total | 1,823,610 | 613,500 | 2,437,110 |
SECOND CHANCE GROUP LIMITED (REGISTERED NUMBER: 04246652) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
for the year ended 31 January 2022 |
1. | STATUTORY INFORMATION |
Second Chance Group Limited is a |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
Turnover |
Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. |
Tangible fixed assets |
Improvements to leasehold property | - |
Fixtures and fittings | - |
Motor vehicles | - |
Computer equipment | - |
Tangible fixed assets are stated at cost less accumulated depreciation. Such cost includes costs directly attributable to making the asset capable of operating as intended. Depreciation is provided on tangible assets at rates calculated to write off the cost, less estimated residual value, of each asset on a systematic basis over its useful expected life. The carrying values of tangible fixed assets are reviewed for impairment when events or changes in circumstances indicate the carrying value may not be recovered. |
Investments in subsidiaries |
Investments in subsidiary undertakings are recognised at cost. |
Stocks |
Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items. |
Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the Consolidated Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. |
Current or deferred taxation assets and liabilities are not discounted. |
Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date. |
Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date. |
Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference. |
Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
SECOND CHANCE GROUP LIMITED (REGISTERED NUMBER: 04246652) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
for the year ended 31 January 2022 |
2. | ACCOUNTING POLICIES - continued |
Foreign currencies |
Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result. |
Hire purchase and leasing commitments |
Assets obtained under hire purchase contracts or finance leases are capitalised in the balance sheet. Those held under hire purchase contracts are depreciated over their estimated useful lives. Those held under finance leases are depreciated over their estimated useful lives or the lease term, whichever is the shorter. |
The interest element of these obligations is charged to profit or loss over the relevant period. The capital element of the future payments is treated as a liability. |
Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease. |
Pension costs and other post-retirement benefits |
The group operates a defined contribution pension scheme. Contributions payable to the group's pension scheme are charged to profit or loss in the period to which they relate. |
Grants |
During the year the group received government support in the form of the Coronavirus Job Retention Scheme. This has been recognised under the accruals model and included within the Income Statement. |
Going concern |
The group has a lengthy and consistent record of strong cash generation which is more than sufficient to meet it's day-to-day working capital requirements. The directors have a reasonable expectation that the group has adequate resources to continue in existence for the foreseeable future and for at least 12 months from the date that these Financial Statements are approved. Therefore, the group adopts the going concern basis in preparing the Financial Statements. |
SECOND CHANCE GROUP LIMITED (REGISTERED NUMBER: 04246652) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
for the year ended 31 January 2022 |
3. | CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY |
In the application of the Group's accounting policies, which are described in note 2, the directors are required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and assumptions are based on historical experience and other factors that are considered to be relevant. 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. |
Critical judgements in applying the Company's accounting policies and key source of estimation uncertainty |
The following are the key sources of estimation uncertainty that the directors have assessed as being applicable to the Group and that have the most significant effect on the amounts recognised in the financial statements. It is deemed that there are no critical accounting judgements. |
Fixed Assets |
Accounting for fixed assets involves the use of estimates for (a) the useful live of the assets over which they are to be depreciated , and (b) the existence and any amount of impairment. Details of fixed assets can be found in note 10. |
Fixed assets are depreciated as detailed in note 2 over the estimated useful lives. When the company estimates useful lives various factors are considered including expected technology obsolescence and the expected usage of the asset. The company regularly reviews these assets useful lives and future economic utilization and the physical condition of the assets concerned. |
The carrying value of the assets is assessed periodically to determine whether there are any indications of any impairment of the value beyond the depreciation charge. If this is the case, an impairment charge is taken against the carrying value of the assets and charged to profit and loss account. The impairment of fixed assets require management judgement in determining the amounts to be impaired, in particular judgement is used when assessing the future cash flows. |
Stock |
Stock provisions are provided where it is considered that the amount realisable is considered to be less than its carrying amount. The provision's are made using management's best estimate for recoverable amounts. |
4. | EMPLOYEES AND DIRECTORS |
2022 | 2021 |
£ | £ |
Wages and salaries | 914,169 | 840,835 |
Social security costs | 75,346 | 62,473 |
Other pension costs | 131,746 | 45,741 |
1,121,261 | 949,049 |
The average number of employees during the year was as follows: |
2022 | 2021 |
Total staff |
The average number of employees by undertakings that were proportionately consolidated during the year was 38 (2021 - 42 ) . |
SECOND CHANCE GROUP LIMITED (REGISTERED NUMBER: 04246652) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
for the year ended 31 January 2022 |
4. | EMPLOYEES AND DIRECTORS - continued |
2022 | 2021 |
£ | £ |
Director's remuneration | 69,012 | 30,627 |
Director's pension contributions to money purchase schemes | 108,049 | 30,113 |
The number of directors to whom retirement benefits were accruing was as follows: |
Money purchase schemes | 3 | 3 |
5. | OPERATING PROFIT |
The operating profit is stated after charging/(crediting): |
2022 | 2021 |
£ | £ |
Other operating leases | 117,935 | 133,319 |
Depreciation - owned assets | 34,207 | 32,005 |
Depreciation - assets on hire purchase contracts | 1,649 | 1,832 |
Loss/(profit) on disposal of fixed assets | 45,416 | (439 | ) |
Auditors' remuneration | 12,300 | - |
6. | AMOUNTS WRITTEN OFF INVESTMENTS |
2022 | 2021 |
£ | £ |
Investments written off | 100 | - |
7. | INTEREST PAYABLE AND SIMILAR EXPENSES |
2022 | 2021 |
£ | £ |
Bank interest | 347 | 1,791 |
Hire purchase | 1,299 | 741 |
1,646 | 2,532 |
8. | TAXATION |
Analysis of the tax charge |
The tax charge on the profit for the year was as follows: |
2022 | 2021 |
£ | £ |
Current tax: |
UK corporation tax | 463,108 | 550,830 |
Deferred tax | 4,606 | (340 | ) |
Tax on profit | 467,714 | 550,490 |
SECOND CHANCE GROUP LIMITED (REGISTERED NUMBER: 04246652) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
for the year ended 31 January 2022 |
8. | TAXATION - continued |
Reconciliation of total tax charge included in profit and loss |
The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below: |
2022 | 2021 |
£ | £ |
Profit before tax | 2,372,516 | 2,892,738 |
Profit multiplied by the standard rate of corporation tax in the UK of 19 % (2021 - 19 %) |
450,778 |
549,620 |
Effects of: |
Expenses not deductible for tax purposes | 8,931 | 247 |
Depreciation in excess of capital allowances | 3,218 | 963 |
Deferred tax charge | 4,606 | (340 | ) |
Trade losses for year carried forward | 181 | - |
Total tax charge | 467,714 | 550,490 |
9. | INDIVIDUAL INCOME STATEMENT |
As permitted by Section 408 of the Companies Act 2006, the Income Statement of the parent company is not presented as part of these financial statements. |
10. | DIVIDENDS |
2022 | 2021 |
£ | £ |
A Ordinary shares of £1 each |
Interim | 142,000 | 80,000 |
B Ordinary shares of £1 each |
Interim | 242,001 | 140,000 |
C Ordinary shares of £1 each |
Interim | 91,200 | 80,000 |
D Ordinary shares of £1 each |
Interim | 88,800 | 80,000 |
564,001 | 380,000 |
SECOND CHANCE GROUP LIMITED (REGISTERED NUMBER: 04246652) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
for the year ended 31 January 2022 |
11. | TANGIBLE FIXED ASSETS |
Group |
Improvements |
to | Fixtures |
Freehold | leasehold | and |
property | property | fittings |
£ | £ | £ |
COST |
At 1 February 2021 | 250,000 | 170,253 | 289,249 |
Additions | - | - | 12,503 |
Disposals | - | (75,157 | ) | - |
At 31 January 2022 | 250,000 | 95,096 | 301,752 |
DEPRECIATION |
At 1 February 2021 | - | 46,286 | 205,171 |
Charge for year | - | 3,405 | 9,661 |
Eliminated on disposal | - | (29,766 | ) | - |
At 31 January 2022 | - | 19,925 | 214,832 |
NET BOOK VALUE |
At 31 January 2022 | 250,000 | 75,171 | 86,920 |
At 31 January 2021 | 250,000 | 123,967 | 84,078 |
Motor | Computer |
vehicles | equipment | Totals |
£ | £ | £ |
COST |
At 1 February 2021 | 99,443 | 82,043 | 890,988 |
Additions | - | 2,540 | 15,043 |
Disposals | (4,003 | ) | (55,062 | ) | (134,222 | ) |
At 31 January 2022 | 95,440 | 29,521 | 771,809 |
DEPRECIATION |
At 1 February 2021 | 34,959 | 75,743 | 362,159 |
Charge for year | 16,113 | 6,677 | 35,856 |
Eliminated on disposal | (3,978 | ) | (55,062 | ) | (88,806 | ) |
At 31 January 2022 | 47,094 | 27,358 | 309,209 |
NET BOOK VALUE |
At 31 January 2022 | 48,346 | 2,163 | 462,600 |
At 31 January 2021 | 64,484 | 6,300 | 528,829 |
SECOND CHANCE GROUP LIMITED (REGISTERED NUMBER: 04246652) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
for the year ended 31 January 2022 |
11. | TANGIBLE FIXED ASSETS - continued |
Group |
Fixed assets, included in the above, which are held under hire purchase contracts are as follows: |
Fixtures |
and |
fittings |
£ |
COST |
At 1 February 2021 |
and 31 January 2022 | 23,000 |
DEPRECIATION |
At 1 February 2021 | 6,513 |
Charge for year | 1,649 |
At 31 January 2022 | 8,162 |
NET BOOK VALUE |
At 31 January 2022 | 14,838 |
At 31 January 2021 | 16,487 |
12. | FIXED ASSET INVESTMENTS |
Group |
Shares in |
group |
undertakings |
£ |
COST |
At 1 February 2021 | 100 |
Disposals | (100 | ) |
At 31 January 2022 | - |
NET BOOK VALUE |
At 31 January 2022 | - |
At 31 January 2021 | 100 |
SECOND CHANCE GROUP LIMITED (REGISTERED NUMBER: 04246652) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
for the year ended 31 January 2022 |
12. | FIXED ASSET INVESTMENTS - continued |
Company |
Shares in |
group |
undertakings |
£ |
COST |
At 1 February 2021 |
Disposals | ( |
) |
At 31 January 2022 |
NET BOOK VALUE |
At 31 January 2022 |
At 31 January 2021 |
The group or the company's investments at the Balance Sheet date in the share capital of companies include the following: |
Subsidiary |
Registered office: 17 St Peters Place, Fleetwood, Lancashire FY7 6EB |
Nature of business: |
% |
Class of shares: | holding |
2022 | 2021 |
£ | £ |
Aggregate capital and reserves |
Profit for the year |
13. | STOCKS |
Group |
2022 | 2021 |
£ | £ |
Stocks | 2,956,100 | 2,096,973 |
SECOND CHANCE GROUP LIMITED (REGISTERED NUMBER: 04246652) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
for the year ended 31 January 2022 |
14. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
Group | Company |
2022 | 2021 | 2022 | 2021 |
£ | £ | £ | £ |
Trade debtors | 1,350,810 | 1,484,949 |
Amounts owed by group undertakings | - | - |
Other debtors | 47,500 | 85,769 |
Directors' current accounts | 191,329 | 288,664 | 191,329 | - |
Tax | - | 6,884 |
Prepayments | 91,505 | 89,110 |
1,681,144 | 1,955,376 |
15. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
Group | Company |
2022 | 2021 | 2022 | 2021 |
£ | £ | £ | £ |
Hire purchase contracts (see note 17) | 5,159 | 3,774 |
Trade creditors | 481,287 | 582,323 |
Tax | 243,993 | 550,831 |
Social security and other taxes | 11,018 | 21,083 |
VAT | 290,113 | 15,105 | - | - |
Other creditors | 24,666 | 2,539 |
Accrued expenses | 31,210 | 123,746 |
1,087,446 | 1,299,401 |
16. | CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR |
Group |
2022 | 2021 |
£ | £ |
Hire purchase contracts (see note 17) | 443 | 4,867 |
17. | LEASING AGREEMENTS |
Minimum lease payments fall due as follows: |
Group |
Hire purchase contracts |
2022 | 2021 |
£ | £ |
Net obligations repayable: |
Within one year | 5,159 | 3,774 |
Between one and five years | 443 | 4,867 |
5,602 | 8,641 |
SECOND CHANCE GROUP LIMITED (REGISTERED NUMBER: 04246652) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
for the year ended 31 January 2022 |
18. | SECURED DEBTS |
The following secured debts are included within creditors: |
Group |
2022 | 2021 |
£ | £ |
Hire purchase contracts | 5,602 | 8,641 |
The hire purchase is secured on the assets to which it relates. |
19. | PROVISIONS FOR LIABILITIES |
Group |
2022 | 2021 |
£ | £ |
Deferred tax | 32,648 | 28,043 |
Group |
Deferred |
tax |
£ |
Balance at 1 February 2021 | 28,043 |
Movement during year | 4,605 |
Balance at 31 January 2022 | 32,648 |
Finance bill 2021 provisions to increase the main rate of UK corporation tax from 1st April 2023. As substantive enactment had occurred before the balance sheet date, deferred tax balances as at 31st January 2022 have been updated to be measured at a rate of 25% (2021: 19%). |
20. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2022 | 2021 |
value: | £ | £ |
A Ordinary | £1 | 35 | 35 |
B Ordinary | £1 | 35 | 35 |
C Ordinary | £1 | 15 | 15 |
D Ordinary | £1 | 15 | 15 |
100 | 100 |
SECOND CHANCE GROUP LIMITED (REGISTERED NUMBER: 04246652) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
for the year ended 31 January 2022 |
21. | RESERVES |
Group |
Retained |
earnings |
£ |
At 1 February 2021 | 5,081,118 |
Profit for the year | 1,904,802 |
Dividends | (564,001 | ) |
At 31 January 2022 | 6,421,919 |
22. | DIRECTOR'S ADVANCES, CREDITS AND GUARANTEES |
The following advances and credits to a director subsisted during the years ended 31 January 2022 and 31 January 2021: |
2022 | 2021 |
£ | £ |
T P Daniels |
Balance outstanding at start of year | 241,890 | 138,565 |
Amounts advanced | 104,197 | 268,805 |
Amounts repaid | (154,758 | ) | (165,480 | ) |
Amounts written off | - | - |
Amounts waived | - | - |
Balance outstanding at end of year | 191,329 | 241,890 |
The loan to the director was unsecured and repayable on demand. Interest is payable at the HMRC rate applicable to beneficial loan arrangements. |
23. | RELATED PARTY DISCLOSURES |
The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group. |
Transactions between group entities which have been eliminated on consolidation are not disclosed within the financial statements. |
During the year, total dividends of £242,000 were paid to the director . |
Entities with control, joint control or significant influence over the entity |
2022 | 2021 |
£ | £ |
Dividends paid by the company | 564,001 | 380,000 |
Rent paid | 65,000 | 65,000 |
Amount due from related party | 191,329 | - |
Amount due to related party | 24,362 | - |
SECOND CHANCE GROUP LIMITED (REGISTERED NUMBER: 04246652) |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued |
for the year ended 31 January 2022 |
23. | RELATED PARTY DISCLOSURES - continued |
Other related parties |
2022 | 2021 |
£ | £ |
Transfers | 44,503 | - |
Amount due from related party | 44,503 | - |
24. | POST BALANCE SHEET EVENTS |
In June 2022, the group purchased freehold property from the director, Mr T P Daniels, for a total consideration of £476,000. |