Company registration number 10397084 (England and Wales)
AI LONDON LIMITED
UNAUDITED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
PAGES FOR FILING WITH REGISTRAR
AI LONDON LIMITED
CONTENTS
Page
Directors' report
1
Balance sheet
2 - 3
Notes to the financial statements
4 - 9
AI LONDON LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 1 -

The directors present their annual report and financial statements for the year ended 31 December 2022.

Principal activities

The principal activity of the company continued to be that of manufacturing and installation of high quality bespoke furniture for the UK house building market.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

D Francis
C Francis
Review of business

In 2022 AI London demonstrated solid sales growth which resulted in a stronger Order Book at the end of the year.

 

The growth in sales though was more than offset by the increase in raw material costs driven by external factors. In 2022 the business was committed to a number of fixed priced contracts which have now largely expired. This has directly caused a disappointing set of financial results.

 

To address this, the Directors have implemented a number of initiatives which will substantially reduce our manufacturing costs. These benefits will start in the coming months.

 

The Directors continue to have confidence in the trajectory of the business.

This report has been prepared in accordance with the provisions applicable to companies entitled to the small companies exemption.

On behalf of the board
C Francis
Director
29 September 2023
AI LONDON LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2022
31 December 2022
- 2 -
2022
2021
Notes
£
£
£
£
Fixed assets
Tangible assets
4
111,242
152,446
Current assets
Stocks and work in progress
395,945
348,826
Debtors
5
1,079,408
846,142
Cash at bank and in hand
163,806
63,040
1,639,159
1,258,008
Creditors: amounts falling due within one year
6
(1,231,736)
(590,819)
Net current assets
407,423
667,189
Total assets less current liabilities
518,665
819,635
Creditors: amounts falling due after more than one year
7
(1,027,599)
(942,355)
Net liabilities
(508,934)
(122,720)
Capital and reserves
Called up share capital
108
108
Share premium account
242,440
242,440
Profit and loss reserves
(751,482)
(365,268)
Total equity
(508,934)
(122,720)

The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true

For the financial year ended 31 December 2022 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.

The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.

The members have not required the company to obtain an audit of its financial statements for the year in question in accordance with section 476.

These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.

AI LONDON LIMITED
BALANCE SHEET (CONTINUED)
AS AT
31 DECEMBER 2022
31 December 2022
- 3 -
The financial statements were approved by the board of directors and authorised for issue on 29 September 2023 and are signed on its behalf by:
C Francis
Director
Company Registration No. 10397084
AI LONDON LIMITED
BALANCE SHEET (CONTINUED)
AS AT 31 DECEMBER 2022
31 December 2022
- 4 -
1
Judgements and key sources of estimation uncertainty

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount 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 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 where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

2
Accounting policies
Company information

AI London Limited is a private company limited by shares incorporated in England and Wales. The registered office is Unit 4B, Wheatstone Close, Manor Royal, Crawley, West Sussex, United Kingdom, RH10 9UA.

2.1
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

2.2
Going concern

Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

2.3
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.

Sale of goods

Turnover from the sale of goods is recognised when the significant risks and rewards of ownership of the goods has transferred to the buyer. This is usually at the point that the customer has signed for the delivery of the goods.

Rendering of services

Turnover for the rendering of services is recognised by reference to the stage of completion of the contract. The stage of completion of a contract is measured by comparing the value of works completed to date against the estimated total value of works. When the outcome of a contract cannot be estimated reliably, turnover is only recognised to the extent of recoverable expenses.

AI LONDON LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2
Accounting policies
(Continued)
- 5 -

Other income

Other income relates to (government) grants, representing interest payable covered by the government in relation to the CBILS loan received during the year for the first 12 months of the loan term. It also represents amounts receivable from the job retention scheme claimed by the company for staff that were furloughed due to COVID-19. Under the scheme employers can claim 80% of a furloughed employee's wages up to £2,500 plus associated employer's costs.

 

In addition, other income includes research and development tax credit.

AI LONDON LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
2
Accounting policies
(Continued)
- 6 -
2.4
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Leasehold land and buildings
Leasehold improvements
Over lease term
Plant and equipment
20% straight line
Fixtures and fittings
20% straight line
Computers
20% straight line

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

2.5
Stocks

Stock represents raw materials held at the company's factory premises.

 

Work in progress represents goods held at the company's factory premises, and that which is off-site which has not been invoiced or had an application for payment made under a contract for services.

 

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. 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.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

2.6
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.

2.7
Financial instruments

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

 

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method 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. Financial assets classified as receivable within one year are not amortised.

AI LONDON LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
2
Accounting policies
(Continued)
- 7 -
Basic financial liabilities

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, 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. Financial liabilities classified as payable within one year are not amortised.

 

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

2.8
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.

Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recognised in profit or loss immediately, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.

2.9
Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

 

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

2.10
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 conditions are met. Where a grant 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.

3
Employees

The average monthly number of persons (including directors) employed by the company during the year was:

2022
2021
Number
Number
Total
42
30
AI LONDON LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 8 -
4
Tangible fixed assets
Land and buildings
Plant and machinery etc
Total
£
£
£
Cost
At 1 January 2022
84,451
447,822
532,273
Additions
-
0
16,239
16,239
At 31 December 2022
84,451
464,061
548,512
Depreciation and impairment
At 1 January 2022
37,152
342,675
379,827
Depreciation charged in the year
11,801
45,642
57,443
At 31 December 2022
48,953
388,317
437,270
Carrying amount
At 31 December 2022
35,498
75,744
111,242
At 31 December 2021
47,299
105,147
152,446
5
Debtors
2022
2021
Amounts falling due within one year:
£
£
Trade debtors
221,698
73,673
Corporation tax recoverable
63,180
-
0
Other debtors
794,530
772,469
1,079,408
846,142
6
Creditors: amounts falling due within one year
2022
2021
£
£
Bank loans
50,000
50,000
Trade creditors
811,212
386,017
Taxation and social security
307,559
94,954
Other creditors
62,965
59,848
1,231,736
590,819
AI LONDON LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 9 -
7
Creditors: amounts falling due after more than one year
2022
2021
£
£
Bank loans and overdrafts
146,423
190,022
Other creditors
881,176
752,333
1,027,599
942,355

The long-term bank loan totals £146,423 (2021: £190,022) representing the non-current element of a CBILS loan, secured by way of fixed and floating charges over the undertaking and all property. The CBILS term is 6 years with an interest rate of 3.99% + base applicable from the 13th month.

Included within other creditors due after more than one year is a shareholder loan of £881,176 (2021: £750,176), which includes accrued interest at a deemed market rate up to 31 December 2019. The shareholders have formally agreed that further interest is not being charged until the company is profitable. It is secured by way of floating charges over the undertaking and all property, as second charge.

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