REGISTERED NUMBER: |
STRATEGIC REPORT, REPORT OF THE DIRECTORS AND |
FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
FOR |
FAIRFIELD GARAGE (LEIGH-ON-SEA) LIMITED |
REGISTERED NUMBER: |
STRATEGIC REPORT, REPORT OF THE DIRECTORS AND |
FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
FOR |
FAIRFIELD GARAGE (LEIGH-ON-SEA) LIMITED |
FAIRFIELD GARAGE (LEIGH-ON-SEA) LIMITED (REGISTERED NUMBER: 00916058) |
CONTENTS OF THE FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
Page |
Company Information | 1 |
Strategic Report | 2 |
Report of the Directors | 6 |
Report of the Independent Auditors | 8 |
Statement of Comprehensive Income | 11 |
Balance Sheet | 12 |
Statement of Changes in Equity | 13 |
Notes to the Financial Statements | 14 |
FAIRFIELD GARAGE (LEIGH-ON-SEA) LIMITED |
COMPANY INFORMATION |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
DIRECTORS: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
AUDITORS: |
Statutory Auditors and Chartered Accountants |
Rutland House |
90-92 Baxter Avenue |
Southend on Sea |
Essex |
SS2 6HZ |
FAIRFIELD GARAGE (LEIGH-ON-SEA) LIMITED (REGISTERED NUMBER: 00916058) |
STRATEGIC REPORT |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
The directors present their strategic report for the year ended 31 December 2021. |
REVIEW OF BUSINESS |
The year under review commenced inauspiciously on the second day of trading, by virtue of the mandated closing to clients of the BMW, MINI and Billericay showrooms. |
This scenario lasted until being permitted to reopen on 12 April 2021. |
Despite this impediment, however, Fairfield again proved its resilience by continuing to build upon its expertise in remote client care. |
Profitable new and used vehicle sales thrived, only being limited by the lack of new car availability resultant from component shortages and supply chain logistics which in turn, had a consequent impact on the number of high quality used vehicles which could be purchased for stock. |
The increase in residual values throughout the industry is well documented and permitted exceptional margins to be retained. |
The fledgling used vehicle operation based in Billericay developed, despite its initial pandemic related limitations, outperforming its target nearly fourfold, producing a positive contribution of £143,000 which represents 6.7% of the company's total profit. |
The company was also still able to capitalise upon all available Government assistance in the form of maximising the Job Retention Scheme receipts, holidays and discounts for business rates and Local Authority grants. |
Job Retention Scheme funding passed to employees amounted to £291,000, business rates assistance added £446,000, whilst Local Authority grants contributed a further £73,000. |
A successful rating appeal produced further refunds of £75,000 making the total of these items £885,000. |
Although the above noted items all contributed to the 2021 level of profitability, conversely, as reported previously, this year was the first for which the group property restructure had taken place, resulting in additional rent of £769,000 being charged, based upon market property valuations. |
Trading conditions throughout the year and each element of the business, remained buoyant with demand exceeding supply in both vehicle sales and labour sales arenas with, as per the global economy, an element of inflationary pressure upon salary levels and expenses.This situation is intensifying in the current year, with a degree of shortages of skilled staff. |
During the year the company also continued its property development interests, with an interim crystallisation of profit. |
As further opportunities arise, they are now being undertaken within an alternative group company. |
These various factors culminated in an exceptional year end pre-tax result at £2.17 million, doubling the 2020 performance and outperforming the anticipated profitability more than threefold. |
Comparing Fairfield with other retailers within the network is now more consistent due to the property restructure and sees Fairfield being over the national average in terms of profit by £190,000 (5.3%) with return on sales of 3.8% against the average of only 3.2% with the 0.6% difference representing an additional 18.75%. This indicates that the company is operating in a highly efficient manner. |
FAIRFIELD GARAGE (LEIGH-ON-SEA) LIMITED (REGISTERED NUMBER: 00916058) |
STRATEGIC REPORT |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
REVIEW OF BUSINESS |
Since the financial year end there has been further geopolitical uncertainty resultant from the breakout of war between Russia and Ukraine on 24 February 2022. |
This has placed further constraints upon the supply of new vehicles due to component manufacturing within Ukraine and is an industry wide issue. |
Whilst this is limiting in terms of volume it is nevertheless beneficial in terms of retained profit margins. |
In summary, as before, the company remains exceptionally well-funded, despite having chosen to economise by reducing the available overdraft facility in order to minimise bank charges. |
The business produces a strong positive cash flow and retains the availability of considerable borrowing reserves and credit lines. |
Early indications for the 2022 calendar year are extremely encouraging with the first trimester exceeding the same period in 2021 more than twofold, by £531,000. |
PRINCIPAL RISKS AND UNCERTAINTIES |
As with all businesses, there is an inherent level of risk and uncertainty associated with constantly evolving and fluctuating market conditions. This applies within the motor industry itself, to government economic policy and the economic climate both within the United Kingdom and, indeed, globally. |
SECTION 172(1) STATEMENT |
Stakeholder engagement |
The board of directors have a legal responsibility under section 172 of the Companies Act 2006 to act in the way we consider, in good faith, would be most likely to promote the company's success for the benefit of its members as a whole, and to have regard to the long-term effect of our decisions on the company and its stakeholders. This statement addresses the ways in which we as a Board outwork this responsibility. |
Decision making |
Regular operational and strategic meetings are held by the directors and core management team. The attendance of appropriate individuals at each meeting ensures the board has access to the key factors affecting all areas of the business, shorter term or longer. |
Furthermore, the company is in constant communication with BMW (UK) Limited, the wider franchise network and various industry specific news sources. This enables the directors to keep abreast of all longer-term shifts in the company's operating markets, ensuring the company's future is never compromised for the sake of its immediate needs. |
Shareholder engagement |
The company is a family owned business with a very successful trading history. The Styles family continues to maintain an active interest in the business' activities and are personally represented on the board of directors. |
ENGAGEMENT WITH EMPLOYEES |
The company maintains an enviable workforce of local employees spanning all aspects of a busy dealership. Staff are rewarded in line with comparable local markets, provided with specific training relevant to their needs and given the constant opportunity for development. The board also fosters a positive, engaging, attitude across all staff levels, and employee consultation is a key part of any significant operational changes. |
FAIRFIELD GARAGE (LEIGH-ON-SEA) LIMITED (REGISTERED NUMBER: 00916058) |
STRATEGIC REPORT |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
ENGAGEMENT WITH SUPPLIERS, CUSTOMERS AND OTHERS |
Business relationships |
Over its many years of operations, the company has fostered very strong relationships with its key suppliers and local customer base. |
The company's primary supplier remains BMW (UK) Limited, with whom the company keeps a close working relationship at all times. Other suppliers are not neglected, however, and the directors continue to deal with all suppliers openly, fairly and with integrity. |
The company maintains a wide customer base, both personal and corporate. Regular mystery shopper visits and brand operational standards ensure Fairfield's customers receive the best service the company can offer, at all times. Furthermore, the company is pleased to repeatedly welcome back customers it has been serving for decades. |
Community and environmental impact |
The directors remain ever conscious of the impact their business has on the local community and environment. As well as being a significant local employer, the company also gives back to the surrounding community via a number of sponsorship and support schemes. It is also mindful of the disruption it causes its immediate neighbours (residential and commercial) and therefore remains considerate in its activities and operational hours. |
Environmentally, the company is at the forefront of vehicular advancements - Fairfield was originally one of the flagship dealerships for the BMW electric range and incorporates various hybrid and low emission vehicles into its range. Operationally, the company processes all waste and hazardous material in accordance with prevailing legislation and guidance. |
Business conduct |
The directors continually assess the company's activities to ensure at all times the business is offering a high standard of business conduct, in accordance with the premium, high quality, marques of vehicle which forms its core business. |
FAIRFIELD GARAGE (LEIGH-ON-SEA) LIMITED (REGISTERED NUMBER: 00916058) |
STRATEGIC REPORT |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
STREAMLINED ENERGY AND CARBON REPORTING |
During the course of the year, the company consumed approximately 1,760 (2020 - 1,551) MWh of energy. This is made up of: |
(a) electricity 690 (2020 - 643) MWh; |
(b) gas 309 (2020 - 244) MWh; and |
(c) road fuel 761 (2020 - 664) MWh. |
Given the wide variety of vehicles (business owned and reimbursed personal) utilised by the company over the course of the year, it is inherently difficult to obtain precise consumption data particularly for road fuel. For the purposes of this reporting, the company has therefore extrapolated its total fuel costs against an average fuel price of £1.33 (2020 - £1.17) per litre and an average energy content of 10kWh (2020 - 10kWh) per litre of fuel (petrol and diesel). |
Using Department for Business, Energy and Industrial Strategy published conversion factors, the company calculates its total greenhouse gas emissions amount to 397 (2020 -368) tonnes of CO2. This is made up of: |
(a) electricity 147 (2020 - 137) tonnes; |
(b) gas 63 (2020 - 50) tonnes; and |
(c) road fuel 188 (2020 - 181) tonnes. |
This therefore equates to an approximate emission intensity of 5.9 (2020 - 6.8) tonnes of CO2 per £1m of sales revenue. |
ON BEHALF OF THE BOARD: |
FAIRFIELD GARAGE (LEIGH-ON-SEA) LIMITED (REGISTERED NUMBER: 00916058) |
REPORT OF THE DIRECTORS |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
The directors present their report with the financial statements of the company for the year ended 31 December 2021. |
DIVIDENDS |
Interim dividends per share were paid during the year as follows: |
"A" Ordinary £1 - £0.11p |
"B" Ordinary £1 - £0.11p |
The total distribution of dividends for the year ended 31 December 2021 will be £4,445. |
DIRECTORS |
The directors shown below have held office during the whole of the period from 1 January 2021 to the date of this report. |
STATEMENT OF DIRECTORS' RESPONSIBILITIES |
The directors are responsible for preparing the Strategic Report, the Report of the Directors 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), including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 of 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 judgements and accounting estimates that are reasonable and prudent; |
- | state whether applicable 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 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. |
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS |
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director 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 company's auditors are aware of that information. |
FAIRFIELD GARAGE (LEIGH-ON-SEA) LIMITED (REGISTERED NUMBER: 00916058) |
REPORT OF THE DIRECTORS |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
AUDITORS |
The auditors, Goldwyns 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 |
FAIRFIELD GARAGE (LEIGH-ON-SEA) LIMITED |
Opinion |
We have audited the financial statements of Fairfield Garage (Leigh-on-Sea) Limited (the 'company') for the year ended 31 December 2021 which comprise the Statement of Comprehensive Income, Balance Sheet, Statement of Changes in Equity and 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 company's affairs as at 31 December 2021 and of its 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 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 directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, 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. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
FAIRFIELD GARAGE (LEIGH-ON-SEA) LIMITED |
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 Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Strategic Report and the Report of the Directors 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 Report of the Directors. |
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, 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 Statement of Directors' Responsibilities set out on page six, 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 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. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
FAIRFIELD GARAGE (LEIGH-ON-SEA) LIMITED |
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. |
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. |
In order to address the risks of misstatements in respect of irregularities, including fraud, we have: |
- | obtained an understanding of the key laws and regulations applicable to the company, including the Companies Act 2006, its BMW franchise agreement and applicable taxation legislation; |
- | assessed the company's own internal controls and systems for the prevention and detection of irregularities and particularly the control environment within which they operate; |
- | determined a materiality level and audit approach sufficient to identify most irregularities, including fraud, that may occur; |
- | considered our own involvement in the preparation of the company's statutory financial statements and taxation returns; |
- | conducted audit verification work, on a sample basis, on the key audit areas and risks we have identified; and |
- | reflected on the outcome of our work, and the likelihood that conclusions drawn may be indicative of other areas of potential irregularity. |
We therefore consider our audit approach has been sufficient to detect material irregularities, including fraud. |
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. |
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 and Chartered Accountants |
Rutland House |
90-92 Baxter Avenue |
Southend on Sea |
Essex |
SS2 6HZ |
FAIRFIELD GARAGE (LEIGH-ON-SEA) LIMITED (REGISTERED NUMBER: 00916058) |
STATEMENT OF COMPREHENSIVE |
INCOME |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
2021 | 2020 |
Notes | £ | £ |
TURNOVER |
Cost of sales |
GROSS PROFIT |
Administrative expenses |
1,509,688 | (282,638 | ) |
Other operating income |
OPERATING PROFIT | 4 |
Profit on sale of freehold |
property | 5 |
Loss on sale of investment |
property | 5 | ( |
) |
2,240,677 | 6,598,447 |
Interest receivable and similar income | 6 |
2,297,822 | 6,675,464 |
Interest payable and similar expenses | 7 |
PROFIT BEFORE TAXATION |
Tax on profit | 8 |
PROFIT FOR THE FINANCIAL YEAR |
OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE INCOME FOR THE YEAR |
FAIRFIELD GARAGE (LEIGH-ON-SEA) LIMITED (REGISTERED NUMBER: 00916058) |
BALANCE SHEET |
31 DECEMBER 2021 |
2021 | 2020 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Tangible assets | 11 |
Investment property | 12 |
CURRENT ASSETS |
Stocks | 13 |
Debtors | 14 |
Cash at bank and in hand |
CREDITORS |
Amounts falling due within one year | 15 |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
PROVISIONS FOR LIABILITIES | 19 |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 20 |
Share premium | 21 |
Capital redemption reserve | 21 |
Retained earnings | 21 |
SHAREHOLDERS' FUNDS |
The financial statements were approved by the Board of Directors and authorised for issue on |
FAIRFIELD GARAGE (LEIGH-ON-SEA) LIMITED (REGISTERED NUMBER: 00916058) |
STATEMENT OF CHANGES IN EQUITY |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
Called up |
share | Retained | Share |
capital | earnings | premium |
£ | £ | £ |
Balance at 1 January 2020 |
Changes in equity |
Dividends | - | ( |
) | - |
Total comprehensive income | - | - |
Balance at 31 December 2020 |
Changes in equity |
Dividends | - | ( |
) | - |
Total comprehensive income | - | - |
Balance at 31 December 2021 |
Capital |
Revaluation | redemption | Total |
reserve | reserve | equity |
£ | £ | £ |
Balance at 1 January 2020 |
Changes in equity |
Dividends | - | - | ( |
) |
Total comprehensive income | ( |
) |
Balance at 31 December 2020 |
Changes in equity |
Dividends | - | - | ( |
) |
Total comprehensive income |
Balance at 31 December 2021 |
FAIRFIELD GARAGE (LEIGH-ON-SEA) LIMITED (REGISTERED NUMBER: 00916058) |
NOTES TO THE FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
1. | STATUTORY INFORMATION |
Fairfield Garage (Leigh-on-Sea) Limited is a |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
Financial Reporting Standard 102 - reduced disclosure exemptions |
Exemption has been taken from preparing a cash flow statement on the grounds that the parent company includes the subsidiary in its published financial statements. |
Turnover |
Turnover represents the net accrued income of a motor group, including a BMW and MINI retailer, excluding value added tax. Income from the sale of cars, parts, associated goods and commissions are recognised in the period in which the customer takes legal responsibility for the goods. Income receivable for the provision of services, including bodyshop repair work, is recognised in the period to which entitlement is incurred. |
Tangible fixed assets |
Depreciation is provided on all tangible assets at rates calculated to write off the cost, less estimated residual value, of each asset evenly over its expected useful life as follows: |
Freehold property | - fifty years |
Leasehold property | - evenly over the lease term |
Plant and machinery | - four to twenty years |
Fixtures and fittings | - two to twenty years |
Computer equipment | - three years |
Where substantial dealership refurbishment works have been apportioned to other fixed asset categories, the depreciation has instead been charged over the remaining period of the building's life. |
Investment property |
Investment property is shown at most recent valuation. Any aggregate surplus or deficit arising from changes in fair value is recognised in profit or loss. |
Current asset investments |
The company has a policy of investing surplus reserves into short term property development agreements which are anticipated to return a higher yield than fixed term cash deposits. |
When undertaking property development the properties are recognised at cost, less any necessary provision for impairment. Once the development is complete and the property is available for sale, the current asset investment is then recognised at market value with any gains or losses accruing reflected in the profit and loss account. At the final disposal of the current asset, the total surplus or deficit is recognised in the profit and loss account. |
FAIRFIELD GARAGE (LEIGH-ON-SEA) LIMITED (REGISTERED NUMBER: 00916058) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
2. | ACCOUNTING POLICIES - continued |
Stocks |
Stock is valued at the lower of cost and net realisable value, as follows: |
Vehicles | - actual cost of purchase |
Parts, oil and consumables | - actual cost of purchase |
Work in progress | - cost of direct materials and labour |
Due allowance has been made for obsolete and slow moving items. |
Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the Statement of Comprehensive Income, 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. |
Pension costs and other post-retirement benefits |
The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate. |
3. | EMPLOYEES AND DIRECTORS |
2021 | 2020 |
£ | £ |
Wages and salaries |
Social security costs |
Other pension costs |
FAIRFIELD GARAGE (LEIGH-ON-SEA) LIMITED (REGISTERED NUMBER: 00916058) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
3. | EMPLOYEES AND DIRECTORS - continued |
The average number of employees during the year was as follows: |
2021 | 2020 |
Sales | 35 | 47 |
Service | 39 | 49 |
Parts | 13 | 16 |
Bodyshop | 10 | 13 |
Accounts and administration | 20 | 22 |
Directors | 2 | 2 |
2021 | 2020 |
£ | £ |
Directors' remuneration |
Directors' pension contributions to money purchase schemes |
The number of directors to whom retirement benefits were accruing was as follows: |
Money purchase schemes |
4. | OPERATING PROFIT |
The operating profit is stated after charging/(crediting): |
2021 | 2020 |
£ | £ |
Depreciation - owned assets |
(Profit)/loss on disposal of fixed assets | ( |
) |
Auditors' remuneration |
Auditors' remuneration - non-audit services |
Operating leases - land and buildings |
5. | EXCEPTIONAL ITEMS |
2021 | 2020 |
£ | £ |
Profit on sale of freehold |
property |
Loss on sale of investment |
property | ( |
) |
- | 5,525,481 |
During 2020, the company transferred all of its freehold property and most of its investment property to fellow subsidiaries at market rate. |
FAIRFIELD GARAGE (LEIGH-ON-SEA) LIMITED (REGISTERED NUMBER: 00916058) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
6. | INTEREST RECEIVABLE AND SIMILAR INCOME |
2021 | 2020 |
£ | £ |
Other interest received |
7. | INTEREST PAYABLE AND SIMILAR EXPENSES |
2021 | 2020 |
£ | £ |
Bank interest |
Loan interest |
8. | TAXATION |
Analysis of the tax charge |
The tax charge on the profit for the year was as follows: |
2021 | 2020 |
£ | £ |
Current tax: |
UK corporation tax |
Deferred tax | ( |
) |
Tax on profit |
Reconciliation of total tax charge included in profit and loss |
The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained below: |
2021 | 2020 |
£ | £ |
Profit before tax |
Profit multiplied by the standard rate of corporation tax in the UK of |
Effects of: |
Income not taxable for tax purposes | ( |
) | ( |
) |
properties |
Depreciation not deductible for tax purposes | 9,155 | (27,152 | ) |
Tax cost reimbursed to other group companies | - | 592,040 |
Total tax charge | 398,270 | 764,316 |
FAIRFIELD GARAGE (LEIGH-ON-SEA) LIMITED (REGISTERED NUMBER: 00916058) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
9. | DIVIDENDS |
2021 | 2020 |
£ | £ |
"A" Ordinary shares of £1 each |
Interim |
"B" Ordinary shares of £1 each |
Interim |
10. | OTHER INCOME |
During the year, the company was in receipt of Government support, specifically in relation to the Covid-19 pandemic. Within operating income is £290,671 (2020 - £855,785) in respect of Coronavirus Job Retention Scheme and £73,070 (2020 - £10,500) in respect of local authority business grants. |
11. | TANGIBLE FIXED ASSETS |
Fixtures |
Short | Plant and | and | Computer |
leasehold | machinery | fittings | equipment | Totals |
£ | £ | £ | £ | £ |
COST |
At 1 January 2021 |
Additions |
Disposals | ( |
) | ( |
) |
At 31 December 2021 |
DEPRECIATION |
At 1 January 2021 |
Charge for year |
Eliminated on disposal | ( |
) | ( |
) |
At 31 December 2021 |
NET BOOK VALUE |
At 31 December 2021 |
At 31 December 2020 |
FAIRFIELD GARAGE (LEIGH-ON-SEA) LIMITED (REGISTERED NUMBER: 00916058) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
12. | INVESTMENT PROPERTY |
Total |
£ |
FAIR VALUE |
At 1 January 2021 |
Additions |
Disposals | ( |
) |
At 31 December 2021 |
NET BOOK VALUE |
At 31 December 2021 |
At 31 December 2020 |
The investment property is carried at its cost value at the year-end. |
13. | STOCKS |
2021 | 2020 |
£ | £ |
Vehicle stock | 7,124,956 | 7,654,542 |
Parts stock |
Oil and consumable stock |
Work-in-progress |
14. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2021 | 2020 |
£ | £ |
Trade debtors |
Amounts owed by group undertakings |
Other debtors |
Prepayments and accrued income |
Although there are no formal terms deferring repayment, the majority of the balance owed by group undertakings is unlikely to be recovered within the next twelve months. |
FAIRFIELD GARAGE (LEIGH-ON-SEA) LIMITED (REGISTERED NUMBER: 00916058) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
15. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2021 | 2020 |
£ | £ |
Bank loans and overdrafts (see note 16) |
Finance leases (see note 17) |
Trade creditors |
Tax |
Social security and other taxes |
Other creditors |
Directors' loan accounts | 1,629,611 | 1,907,500 |
Accrued expenses |
16. | LOANS |
An analysis of the maturity of loans is given below: |
2021 | 2020 |
£ | £ |
Amounts falling due within one year or on demand: |
Bank overdrafts |
17. | LEASING AGREEMENTS |
Minimum lease payments under finance leases fall due as follows: |
Finance leases |
2021 | 2020 |
£ | £ |
Net obligations repayable: |
Within one year |
FAIRFIELD GARAGE (LEIGH-ON-SEA) LIMITED (REGISTERED NUMBER: 00916058) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
18. | SECURED DEBTS |
The following secured debts are included within creditors: |
2021 | 2020 |
£ | £ |
Bank overdraft |
Director's loan account | 1,629,611 | 1,907,500 |
Stocking loans | 3,078,941 | 3,469,852 |
In support of the company's banking arrangements, Barclays PLC hold a debenture and first legal charge over a property held by Fairfield Real Estate Limited, a fellow subsidiary. A cross guarantee also exists in support of the same, given by Fairfield Real Estate Limited and Fairfield Limited. |
Fairfield Real Estate Limited, a fellow subsidiary, has given a fixed charge over one of its investment properties, known as Unit 6, Airborne Industrial Estate, in support of the amounts owed by the company to M A K Styles, a director. |
BMW Group retain title of the funded vehicle stock until settlement of the stocking loans. |
19. | PROVISIONS FOR LIABILITIES |
2021 | 2020 |
£ | £ |
Deferred tax | 100,398 | 110,329 |
Deferred |
tax |
£ |
Balance at 1 January 2021 |
Provided during year | ( |
) |
Balance at 31 December 2021 |
Deferred tax provision consists mainly of capital allowances exceeding depreciation and revaluations of fixed asset investments, less a number of other short term timing differences. |
At the balance sheet date, the company also had in excess of £0.7million of capital losses it will be able to offset against future chargeable gains, although no deferred tax asset has been recognised in respect of these. |
20. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2021 | 2020 |
value: | £ | £ |
"A" Ordinary | £1 | 30,092 | 30,092 |
"B" Ordinary | £1 | 9,212 | 9,212 |
39,304 | 39,304 |
FAIRFIELD GARAGE (LEIGH-ON-SEA) LIMITED (REGISTERED NUMBER: 00916058) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2021 |
21. | RESERVES |
Capital |
Retained | Share | redemption |
earnings | premium | reserve | Totals |
£ | £ | £ | £ |
At 1 January 2021 | 13,977,367 |
Profit for the year |
Dividends | ( |
) | ( |
) |
At 31 December 2021 | 15,751,987 |
22. | PENSION COMMITMENTS |
The company operates a defined contribution scheme in respect of its employees. During the year premiums paid by the company amounted to £80,032 (2020 - £78,022). There were premiums of £16,252 (2020 - £15,193) outstanding at the year end. |
23. | ULTIMATE PARENT COMPANY |
The directors consider the ultimate parent company to be Fairfield Limited, a company registered in England and Wales. Fairfield Limited is the parent company of the largest and smallest group of which Fairfield Garage (Leigh-on-Sea) Limited is a member and for which group accounts are prepared. Group accounts are available from Companies House. |
24. | CONTINGENT LIABILITIES |
Fairfield Limited and its subsidiaries (Fairfield Garage (Leigh-on-Sea) Limited, Fairfield Real Estate Limited and Fairfield Investment Properties Limited) have jointly entered into a VAT group and a corporation tax group payment arrangement. Fairfield Garage (Leigh-on-Sea) Limited is the representative member for both taxes. Members of the VAT group are jointly and severally liable for the debts of any party within it, whilst members of the corporation tax group only implicitly bear financial obligations of their associates. |
The tax grouping arrangements were undertaken to ease the administrative burden of all parties involved. Other than the timing of payments, it is estimated there is no financial effect (positive or negative) to any party and in the unlikely event one party found itself bearing the cost of another it is anticipated the loss would be reimbursed accordingly. |
25. | RELATED PARTY DISCLOSURES |
During the year, the company's total compensation to key management personnel (including directors) amounted to £184,870 (2020 - £177,538). The company was also charged rent of £300,000 and interest of £106,482 (2020 - £336,000 and £86,579 respectively) by key management personnel. At the balance sheet date, the company owed key management personnel £1,629,611 (2020 - £1,907,500). |
During the year, the company was charged interest of £658 (2020 - £223) by close members of the directors' families and, at the balance sheet date, the company owed them £119,786 (2020 - £119,128). |
26. | ULTIMATE CONTROLLING PARTY |
The ultimate controlling party is |