REGISTERED NUMBER: 03880838 (England and Wales) |
EDWARD DAVIES COMMERCIALS LIMITED |
STRATEGIC REPORT, REPORT OF THE DIRECTORS AND |
FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
REGISTERED NUMBER: 03880838 (England and Wales) |
EDWARD DAVIES COMMERCIALS LIMITED |
STRATEGIC REPORT, REPORT OF THE DIRECTORS AND |
FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
EDWARD DAVIES COMMERCIALS LIMITED (REGISTERED NUMBER: 03880838) |
CONTENTS OF THE FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
Page |
Company Information | 1 |
Strategic Report | 2 | to | 3 |
Report of the Directors | 4 | to | 5 |
Report of the Independent Auditors | 6 | to | 9 |
Income Statement | 10 |
Other Comprehensive Income | 11 |
Balance Sheet | 12 |
Statement of Changes in Equity | 13 |
Notes to the Financial Statements | 14 | to | 24 |
EDWARD DAVIES COMMERCIALS LIMITED |
COMPANY INFORMATION |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
DIRECTORS: |
SECRETARY: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
AUDITORS: |
Chartered Accountants and Statutory Auditor |
Swansea, United Kingdom |
AUDITORS OFFICE: |
Swansea Enterprise Park |
Swansea |
SA7 9FG |
EDWARD DAVIES COMMERCIALS LIMITED (REGISTERED NUMBER: 03880838) |
STRATEGIC REPORT |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
The directors present their strategic report for the year ended 31 December 2022. |
REVIEW OF BUSINESS |
The Income Statement and Balance Sheet for the year, which includes all relevant key performance indicators, are set out the annexed financial statements. |
The principal activity of the company in the year was that of bespoke vehicle design and modification. |
The strategy of the business is to increase its market share by focussing on new product design and strong customer service. |
The company enjoys a number of competitive advantages including strong brand recognition, where it consistently achieves a strong market share; a well-established reputation for price competitiveness; a knowledgeable and enthusiastic workforce and a strong customer focus throughout the business. |
Whilst trading conditions are expected to remain competitive throughout FY' 23, the board considers the company to be well positioned to manage and take on this challenge. |
Key performance indicators |
The company's key performance indicators (KPI's) are summarised below : |
KPI's - Year ended | 31 December 2022 | 31 December 2021 |
Turnover | £25,805k | £20,240k |
Cash at bank | £2,515k | £1,186k |
Net current assets | £2,845k | £1,381k |
Net assets | £4,485k | £2,278k |
EDWARD DAVIES COMMERCIALS LIMITED (REGISTERED NUMBER: 03880838) |
STRATEGIC REPORT |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
PRINCIPAL RISKS AND UNCERTAINTIES |
The management of the business and the execution of the company's strategy are subject to a number of risks. |
The key business risks affecting the company are considered to relate to competitor activity and employee retention and are summarised as follows : |
Risk | Potential impact | Mitigation |
Competition |
The market in which the company operates is subject to intense competition. The impact of such competition could impact on margins. |
The company continues to invest heavily in new product design, providing customers with a choice of options. This coupled with a strong focus on customer service, results in a high level of repeat business. |
People |
The business could be impacted by the loss of key individuals. |
The business looks to increase staff engagement through (1) opportunities to give feedback and to influence future business developments and (2) training and progression opportunities. |
Price risk |
The company is not exposed to significant commodity price risk as a result of its operations. |
Credit risk |
The company's financial assets are cash and trade debtors. The company's credit risk is primarily attributable to its trade debtors which are presented in the balance sheet net of allowances for doubtful debts. The company has implemented policies that require appropriate credit checks on potential customers before sales are made. |
Liquidity risk |
The company actively maintains a mixture of long-term and short-term debt finance that is designed to ensure that the company has sufficient funds for operations and planned expansions. |
Interest rate cash flow risk |
The company has both interest-bearing assets and interest-bearing liabilities. Interest bearing assets comprise only cash balances, which earn interest at floating rates. The company has a policy of maintaining debt at floating rates. The directors will revisit the appropriateness of this policy should the company's operations change in size or nature. |
ON BEHALF OF THE BOARD: |
EDWARD DAVIES COMMERCIALS LIMITED (REGISTERED NUMBER: 03880838) |
REPORT OF THE DIRECTORS |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
The directors present their report with the financial statements of the company for the year ended 31 December 2022. |
PRINCIPAL ACTIVITY |
The principal activity of the company in the year under review was that of bespoke vehicle design and modification. |
DIVIDENDS |
No dividends will be distributed for the year ended 31 December 2022. |
DIRECTORS |
The directors shown below have held office during the whole of the period from 1 January 2022 to the date of this report. |
GOING CONCERN |
The financial statements have been prepared on a going concern basis which assumes that the company will continue in operational existence for the foreseeable future. In making their assessment the directors have reviewed the balance sheet, the likely future cash flows of the business and have considered the facilities that are in place at the date of signing the report. |
The company meets its day to day working capital requirements from its cash reserves. At the date of signing the report, sales to all key markets have continued to meet budgeted levels. With no indication that at the current time this position will change, the company's forecast and projections show that the company will be able to operate sufficiently. |
At the time of approving the financial statements, the directors have reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue adopt the going concern basis of accounting in preparing the financial statements. |
DISCLOSURE IN THE STRATEGIC REPORT |
Included in the company's strategic report is a review of the business and description of the principal risks and uncertainties facing the company. |
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; |
- | prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business. |
EDWARD DAVIES COMMERCIALS LIMITED (REGISTERED NUMBER: 03880838) |
REPORT OF THE DIRECTORS |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
STATEMENT OF DIRECTORS' RESPONSIBILITIES - continued |
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. |
AUDITORS |
MHA were appointed as the company's auditors for the year ended 31 December 2022. |
The auditors, MHA, 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 |
EDWARD DAVIES COMMERCIALS LIMITED |
Opinion |
We have audited the financial statements of Edward Davies Commercials Limited (the 'company') for the year ended 31 December 2022 which comprise the Income Statement, Other 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 2022 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. |
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. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
EDWARD DAVIES COMMERCIALS LIMITED |
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 pages four and five, 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 |
EDWARD DAVIES COMMERCIALS 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. |
The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: |
Detecting Irregularities |
Irregularities, including fraud, are instances of non-compliance with laws and regulations. |
The objectives of our audit in relation to fraud are as follows : |
- to identify and assess the risks of material mis-statement of the financial statements due to fraud ; |
- to obtain sufficient appropriate audit evidence regarding the assessed risks of material mis-statement due to fraud, through designing and implementing appropriate responses ; |
- and to respond appropriately to fraud or suspected fraud identified during the audit. |
However, the primary responsibility for the prevention and detection of fraud rests with both Those Charged With Governance of the entity and management. |
Auditor's approach to assessing the risks of material mis-statement due to irregularities, including fraud |
We obtained an understanding of the legal and regulatory frameworks that are applicable to the entity and determined that the most significant frameworks which are directly relevant to specific assertions in the financial statements are those that relate to the reporting framework (FRS 102 and Companies Act 2006) and the relevant tax compliance regulations in the UK. We assessed the risks of material misstatement in respect of fraud and considered the extent to which non-compliance with laws and regulations might have a material effect on the financial statements. |
Audit procedures designed to respond to the risks of non-compliance with laws and regulations |
Based on the results of our risk assessment we designed our audit procedures to identify non-compliance with such laws and regulations identified above. We made enquiries of management to understand how the company is complying with those frameworks. Audit procedures performed by the engagement team also included a review of the financial statements disclosures to underlying supporting documentation. |
Audit procedures designed to respond to the risks of fraud |
We assessed the susceptibility of the company's financial statements to material mis-statement, including how fraud might occur by meeting with management to understand where they considered there was susceptibility to fraud. Based on the results of our risk assessment we designed our audit procedures to identify and to address material misstatements in relation to fraud. |
As well as adopting an attitude of professional scepticism, we have obtained information for use in identifying the risk of fraud when performing risk assessment procedures and performed the following procedures in light of the risk of fraud: |
- Discussion amongst the engagement team regarding the susceptibility of the company to fraud; |
- Consideration of the risk of fraud when documenting and testing internal controls; |
- Enquiring of management how they: assess the risk of fraud; identify and respond to the risks of fraud; |
- Enquiring of management and directors whether they have any knowledge of actual or suspected fraud; |
- Enquiring of management and those charged with governance around actual and potential litigation and claims; |
- Assessing the extent of compliance with the laws and regulations considered to have a direct material effect on the financial statements or the operations of the company through enquiry and inspection; |
- Reviewing financial statements or the operations of the company through enquiry and inspection; |
- Reviewing financial statements disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations. |
- Remaining alert to inconsistent or contradictory information and obtaining evidence to support information provided. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
EDWARD DAVIES COMMERCIALS LIMITED |
Management override of controls |
We considered the risk of fraud through management override and, in response, we incorporated testing of manual journal entries into our audit approach. The audit engagement team performed journal entry testing using a risk-based approach and evaluating whether there was evidence of bias, with a focus on any journals indicating large or unusual transactions based on our understanding of the company. |
Considerations around likelihood of detection |
However owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material mis-statements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. In addition, as with any audit, there remained a higher risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations. |
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 |
Chartered Accountants and Statutory Auditor |
Swansea, United Kingdom |
EDWARD DAVIES COMMERCIALS LIMITED (REGISTERED NUMBER: 03880838) |
INCOME STATEMENT |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
2022 | 2021 |
Notes | £ | £ |
TURNOVER | 3 |
Cost of sales |
GROSS PROFIT |
Administrative expenses |
2,908,134 | 2,569,421 |
Other operating income |
OPERATING PROFIT | 5 |
Interest payable and similar expenses | 6 |
PROFIT BEFORE TAXATION |
Tax on profit | 7 |
PROFIT FOR THE FINANCIAL YEAR |
EDWARD DAVIES COMMERCIALS LIMITED (REGISTERED NUMBER: 03880838) |
OTHER COMPREHENSIVE INCOME |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
2022 | 2021 |
Notes | £ | £ |
PROFIT FOR THE YEAR |
OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE INCOME FOR THE YEAR |
EDWARD DAVIES COMMERCIALS LIMITED (REGISTERED NUMBER: 03880838) |
BALANCE SHEET |
31 DECEMBER 2022 |
2022 | 2021 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Intangible assets | 8 |
Tangible assets | 9 |
CURRENT ASSETS |
Stocks | 10 |
Debtors | 11 |
Cash at bank and in hand |
CREDITORS |
Amounts falling due within one year | 12 |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
CREDITORS |
Amounts falling due after more than one year |
13 |
( |
) |
( |
) |
PROVISIONS FOR LIABILITIES | 17 | ( |
) | ( |
) |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 18 |
Share premium | 19 |
Retained earnings | 19 |
SHAREHOLDERS' FUNDS |
The financial statements were approved by the Board of Directors and authorised for issue on |
EDWARD DAVIES COMMERCIALS LIMITED (REGISTERED NUMBER: 03880838) |
STATEMENT OF CHANGES IN EQUITY |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
Called up |
share | Retained | Share | Total |
capital | earnings | premium | equity |
£ | £ | £ | £ |
Balance at 1 January 2021 | ( |
) |
Changes in equity |
Total comprehensive income | - | - |
Balance at 31 December 2021 |
Changes in equity |
Total comprehensive income | - | - |
Balance at 31 December 2022 |
EDWARD DAVIES COMMERCIALS LIMITED (REGISTERED NUMBER: 03880838) |
NOTES TO THE FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
1. | STATUTORY INFORMATION |
Edward Davies Commercials Limited is a |
The presentation currency of the financial statements is the Pound Sterling (£). |
Monetary amounts in these financial statements are rounded to the nearest £. |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
The principal accounting policies adopted are set out below. |
Financial Reporting Standard 102 - reduced disclosure exemptions |
The company has taken advantage of the following disclosure exemption in preparing these financial statements, as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland": |
• | the requirements of Section 7 Statement of Cash Flows. |
The financial statements of the company are consolidated in the financial statements of EDI Holdings Limited. |
Related party exemption |
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. |
Significant judgements and estimates |
In the application of the company's accounting policies, 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 associated assumptions are based on historical experience and other factors which 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 only effects that period or in the period of the revision and future periods if the revision affects both current and future periods. |
EDWARD DAVIES COMMERCIALS LIMITED (REGISTERED NUMBER: 03880838) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
2. | ACCOUNTING POLICIES - continued |
Turnover |
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes . The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates. |
When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income. |
Revenue recognition |
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably. |
Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably.The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered . |
Intangible assets |
Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses. |
Tangible fixed assets |
Land and buildings - in accordance with the property |
Plant and machinery - at varying rates on cost |
Fixtures and fittings - 25% on cost |
Motor vehicles - 25% on cost |
Computer equipment - 20% on cost |
Government grants |
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received. |
A grant that specifies performance conditions is recognised in income when the performance obligations are met. Where a grant date does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability. |
EDWARD DAVIES COMMERCIALS LIMITED (REGISTERED NUMBER: 03880838) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
2. | ACCOUNTING POLICIES - continued |
Stocks |
Stocks and work in progress are valued at the lower of cost and net realisable value, after making due |
allowance for obsolete and slow moving items. Net Realisable Value is the estimated selling price less all estimated costs of completion and costs to be incurred in marketing, selling and distribution. |
Cost is calculated using the first-in, first-out method and includes all purchase, transport, and handling costs in bringing stocks to their present location and condition. |
Financial instruments |
Basic financial assets, which include trade and other debtors and cash and bank balances, are initially measured at transaction price unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. |
Basic financial liabilities, including trade and other creditors and bank loans, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. |
Cash at bank and in hand |
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities. |
Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the 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 |
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. |
Research and development |
Expenditure on research and development is written off in the year in which it is incurred. |
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. |
EDWARD DAVIES COMMERCIALS LIMITED (REGISTERED NUMBER: 03880838) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
2. | ACCOUNTING POLICIES - continued |
Hire purchase and leasing commitments |
Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease. |
Assets held under finance leases, which are leases where substantially all the risks and rewards of ownership of the asset have passed to the company, and hire purchase contracts are capitalised in the statement of financial position and are depreciated over the shorter of the lease term and the assets' useful lives. A corresponding liability is recognised for the lower of the fair value of the leased asset and the present value of the minimum lease payments are apportioned between the reduction of the lease liability and finance charges in the income statement so as to achieve a constant rate of interest on the remaining balance of the liability. |
Equity instruments |
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company. |
Going concern |
These financial statements are prepared on the going concern basis. The directors have a reasonable expectation that the company will continue in operational existence for the foreseeable future. The directors are confident in the company's ability to continue to trade for the foreseeable future and are prepared to provide the necessary financial support to enable it to do so. The financial statements have been prepared on a going concern basis on the assumption that the directors, the parent company and associated parties will continue to support the company to meet its working capital requirements as necessary. |
3. | TURNOVER |
The turnover and profit before taxation are attributable to the one principal activity of the company. |
4. | EMPLOYEES AND DIRECTORS |
2022 | 2021 |
£ | £ |
Wages and salaries, Social security and Other pension costs | 5,586,367 | 3,918,940 |
The average number of employees during the year was as follows : |
2022 | 2021 |
£ | £ |
Production, sales and operations | 120 | 76 |
Administration | 16 | 14 |
Directors | 4 | 4 |
140 | 94 |
2022 | 2021 |
£ | £ |
Directors' remuneration |
EDWARD DAVIES COMMERCIALS LIMITED (REGISTERED NUMBER: 03880838) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
4. | EMPLOYEES AND DIRECTORS - continued |
Information regarding the highest paid director is as follows: |
2022 | 2021 |
£ | £ |
Emoluments etc |
5. | OPERATING PROFIT |
The operating profit is stated after charging/(crediting): |
2022 | 2021 |
£ | £ |
Hire of plant and machinery | 33,424 | 23,507 |
Other operating leases | 346,279 | 284,613 |
Depreciation - owned and leased assets | 1,649,772 | 1,319,601 |
Profit on disposal of fixed assets | (81,096 | ) | (14,996 | ) |
Development costs amortisation | 2,049 | 1,791 |
Computer software amortisation | 17,007 | 8,250 |
Auditors' remuneration | 17,500 | - |
Foreign exchange differences | (3,930 | ) | (122,995 | ) |
6. | INTEREST PAYABLE AND SIMILAR EXPENSES |
2022 | 2021 |
£ | £ |
Bank interest |
Bank loan interest |
Hire purchase |
7. | 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 |
Deferred tax |
Tax on profit |
EDWARD DAVIES COMMERCIALS LIMITED (REGISTERED NUMBER: 03880838) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
7. | 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 |
Profit multiplied by the standard rate of corporation tax in the UK of |
Effects of: |
Expenses not deductible for tax purposes |
Depreciation in excess of capital allowances |
Utilisation of tax losses | ( |
) | ( |
) |
Adjustments to tax charge in respect of previous periods | ( |
) |
Total tax charge | 562,093 | 381,421 |
8. | INTANGIBLE FIXED ASSETS |
Development | Computer |
costs | software | Totals |
£ | £ | £ |
COST |
At 1 January 2022 |
Additions |
At 31 December 2022 |
AMORTISATION |
At 1 January 2022 |
Amortisation for year |
At 31 December 2022 |
NET BOOK VALUE |
At 31 December 2022 |
At 31 December 2021 |
EDWARD DAVIES COMMERCIALS LIMITED (REGISTERED NUMBER: 03880838) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
9. | TANGIBLE FIXED ASSETS |
Fixtures |
Short | Plant and | and |
leasehold | machinery | fittings |
£ | £ | £ |
COST |
At 1 January 2022 |
Additions |
Disposals | ( |
) |
Reclassification/transfer | ( |
) |
At 31 December 2022 |
DEPRECIATION |
At 1 January 2022 |
Charge for year |
Eliminated on disposal | ( |
) |
Reclassification/transfer | ( |
) |
At 31 December 2022 |
NET BOOK VALUE |
At 31 December 2022 |
At 31 December 2021 |
Motor | Computer |
vehicles | equipment | Totals |
£ | £ | £ |
COST |
At 1 January 2022 |
Additions |
Disposals | ( |
) | ( |
) |
Reclassification/transfer |
At 31 December 2022 |
DEPRECIATION |
At 1 January 2022 |
Charge for year |
Eliminated on disposal | ( |
) | ( |
) |
Reclassification/transfer |
At 31 December 2022 |
NET BOOK VALUE |
At 31 December 2022 |
At 31 December 2021 |
EDWARD DAVIES COMMERCIALS LIMITED (REGISTERED NUMBER: 03880838) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
10. | STOCKS |
2022 | 2021 |
£ | £ |
Stocks |
Work-in-progress |
11. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2022 | 2021 |
£ | £ |
Trade debtors |
Directors' current accounts | - | 70,421 |
Corporation tax recoverable |
Prepayments |
12. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2022 | 2021 |
£ | £ |
Bank loans and overdrafts (see note 14) |
Hire purchase contracts (see note 15) |
Trade creditors |
Corporation tax |
Social security and other taxes |
VAT | 1,035,797 | 598,566 |
Other creditors |
Accruals and deferred income |
13. | CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR |
2022 | 2021 |
£ | £ |
Bank loans (see note 14) |
Hire purchase contracts (see note 15) |
Directors' loan accounts | 1,397,347 | - |
Directors' loan accounts are unsecured. Interest is payable at a rate of 10%. |
14. | LOANS |
An analysis of the maturity of loans is given below: |
2022 | 2021 |
£ | £ |
Amounts falling due within one year or on demand: |
Bank loans |
EDWARD DAVIES COMMERCIALS LIMITED (REGISTERED NUMBER: 03880838) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
14. | LOANS - continued |
2022 | 2021 |
£ | £ |
Amounts falling due between two and five years: |
Bank loans - 2-5 years |
15. | LEASING AGREEMENTS |
Minimum lease payments under hire purchase fall due as follows: |
2022 | 2021 |
£ | £ |
Net obligations repayable: |
Within one year |
Between one and five years |
16. | SECURED DEBTS |
The following secured debts are included within creditors: |
2022 | 2021 |
£ | £ |
Bank loans |
Hire purchase contracts | 435,983 | 274,979 |
Bank loans and overdrafts are secured by way of a fixed and floating charge over the assets of the company. |
Obligations under hire purchase contracts are secured on the assets to which they relate. |
17. | PROVISIONS FOR LIABILITIES |
2022 | 2021 |
£ | £ |
Deferred tax | 802,827 | 291,617 |
Deferred |
tax |
£ |
Balance at 1 January 2022 |
Charge to Income Statement during year |
Balance at 31 December 2022 |
EDWARD DAVIES COMMERCIALS LIMITED (REGISTERED NUMBER: 03880838) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
18. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2022 | 2021 |
value | £ | £ |
50 | A Ordinary | £1 | 50 | 50 |
50 | B Ordinary | £1 | 50 | 50 |
14,900 | C Ordinary | £1 | 14,900 | 14,900 |
5,000 | D Ordinary | £1 | 5,000 | 5,000 |
20,000 | 20,000 |
19. | RESERVES |
Retained | Share |
earnings | premium | Totals |
£ | £ | £ |
At 1 January 2022 | 2,257,688 |
Profit for the year |
At 31 December 2022 | 4,464,831 |
20. | PENSION COMMITMENTS |
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund. £38,278 (2021 - £24,190) contributions were outstanding at the balance sheet date. |
21. | DIRECTORS' ADVANCES, CREDITS AND GUARANTEES |
The following advances and credits to a director subsisted during the years ended 31 December 2022 and 31 December 2021: |
2022 | 2021 |
£ | £ |
Balance outstanding at start of year |
Amounts advanced |
Amounts repaid | ( |
) |
Amounts written off | - | - |
Amounts waived | - | - |
Balance outstanding at end of year |
£Nil dividends were paid in the year in respect of shares held by the company's directors. |
At the balance sheet date, the amount owed by a director to the company was £0, (2021 - £70,421). |
Interest was charged at a rate of 2.5%. |
EDWARD DAVIES COMMERCIALS LIMITED (REGISTERED NUMBER: 03880838) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
22. | ULTIMATE CONTROLLING PARTY |
The parent company is EDI Holdings Limited, a company registered in England and Wales. The registered office is Wentwood House, Langstone Business Park, Newport, NP18 2HJ. |
The ultimate controlling party is the director, Mr E Davies. |