REGISTERED NUMBER: |
SEATING MATTERS LTD |
STRATEGIC REPORT, DIRECTORS' REPORT AND |
FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022 |
REGISTERED NUMBER: |
SEATING MATTERS LTD |
STRATEGIC REPORT, DIRECTORS' REPORT AND |
FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2022 |
SEATING MATTERS LTD (REGISTERED NUMBER: NI057995) |
CONTENTS OF THE FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
Page |
Company Information | 1 |
Strategic Report | 2 |
Directors' Report | 4 |
Independent Auditors' Report | 6 |
Income Statement | 10 |
Statement of Financial Position | 11 |
Statement of Changes in Equity | 12 |
Notes to the Financial Statements | 13 |
SEATING MATTERS LTD |
COMPANY INFORMATION |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
DIRECTORS: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
INDEPENDENT AUDITORS: |
Chartered Accountants and Statutory Auditors |
36-38 Northland Row |
Dungannon |
Co. Tyrone |
BT71 6AP |
BANKERS: |
North Business Centre |
1-2 Broadway |
Ballymena |
Co. Antrim |
BT43 7AA |
SOLICITORS: |
10-12 Artillery Street |
Derry |
BT48 6RG |
SEATING MATTERS LTD (REGISTERED NUMBER: NI057995) |
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 |
Seating Matters Ltd continues to deliver a strong trading performance in respect of the year ended 31 December 2022 and the business remains in a sound financial position at the year end. The company returned a profit before tax for the financial year of £2,026,218 (2021: £2,813,943). |
The directors consider the key performance indicators are those that communicate the financial performance and strengths as a whole, being revenue, gross profit margin and operating profit. |
The directors have provided an analysis of the key performance indicators of the business below. The directors continue to monitor revenue and costs to ensure the company remains profitable. The company continues to maintain a strong net asset position. |
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 and uncertainties affecting the company relate to competition. The directors carry out regular strategic reviews including assessments of competitor activity and market trends. The risks are also, addressed through not being overly reliant on any one customer, strong customer service as well as investment in its people and facilities. |
Financial Risk Management |
The company's operations expose it to a variety of financial risks that include foreign exchange risk, price risk and credit risk. |
Given the size of the company, the directors have not delegated the responsibility of monitoring financial risk management to a sub-committee of the board. The policies set by the board of directors are implemented by the company's finance department. |
Foreign Exchange Risk |
While the greater part of the company's revenues and expenses are denominated in sterling, the company is exposed to some foreign exchange risk in the normal course of business, both on sales and purchases in Canadian dollars and US dollars. While the company has not used financial instruments to date to hedge foreign exchange exposure, this position is kept constantly under review. |
Price Risk Management |
The company is exposed to commodity price risk as a result of its operations. However, given the size of the company's operations, the costs of managing exposure to commodity price risk exceed any potential benefits. The directors will revisit the appropriateness of this policy should the company's operations change in size or nature. The company has no exposure to equity securities price risk as it holds no listed or other equity investments. |
Credit Risk |
The company has implemented policies that require appropriate credit checks on potential customers before sales are made. The amount of exposure to individual customers is subject to a limit, which is reassessed regularly by the board. |
Covid-19 Risk |
The directors continue to monitor the situation closely and implement changes where necessary to minimise the risk of business disruptions. The company is flexible, having adapted easily to social distancing amongst employees. |
STRATEGY & DEVELOPMENT |
The company's success is dependent on understanding and meeting the developing needs of customers and developing innovative solutions for their needs. The company will continue to improve upon its position and concentrate on achieving maximum growth in its market sector while at the same time continuing to improve efficiency in all areas of its operations. With its proven track record the company believes it will be well placed to retain existing customers and generate new business. |
SEATING MATTERS LTD (REGISTERED NUMBER: NI057995) |
STRATEGIC REPORT |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
HEALTH AND SAFETY |
The company is committed to achieving the highest practicable standards in health and safety management and strives to make its sites and offices safe environments for employees and customers alike. |
FINANCIAL KEY PERFORMANCE INDICATORS |
The directors consider the key performance indicators of the company to be those that reflect the performance of the company as a whole: |
2022 | 2021 |
Revenue: | £8,317,795 | £7,253,056 |
Gross profit margin: | 41.45% | 54.27% |
Operating profit: | £2,025,877 | £2,737,161 |
FUTURE DEVELOPMENTS |
The company is committed to long term creation of shareholder value by increasing the company's market share. The company aims to increase revenue and operating profits. The company will continue to meet the needs of the customers and develop innovative solutions for their needs while remaining highly competitive. |
EMPLOYEES |
The company's policy is to consult and discuss with employees matters likely to affect employees' interests. |
The company's most important resource is its people, their knowledge and experience is crucial to meeting customer requirements. Retention of key staff is critical. |
ON BEHALF OF THE BOARD: |
SEATING MATTERS LTD (REGISTERED NUMBER: NI057995) |
DIRECTORS' REPORT |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
The directors present their report with the audited 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 manufacturing of chairs for use in the healthcare sector. |
DIVIDENDS |
The company paid interim dividends in the year of £500,000 (2021: £2,694,500). |
The directors do not recommend the payment of a final dividend (2021: £Nil). |
RESEARCH AND DEVELOPMENT |
The company continues to recognise the importance of its research and development programme, which it believes is essential to ensure that the business continues to develop new products and remain competitive in the market. |
DIRECTORS |
The directors shown below have held office during the whole of the period from 1 January 2022 to the date of this report. |
POLITICAL DONATIONS AND EXPENDITURE |
The Company made no political donations or incurred any political expenditure during the current or prior year. |
DIRECTORS' RESPONSIBILITIES STATEMENT |
The directors are responsible for preparing the Strategic Report, the Directors' Report and the financial statements in accordance with applicable law and regulations. |
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law), 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. |
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. |
SEATING MATTERS LTD (REGISTERED NUMBER: NI057995) |
DIRECTORS' REPORT |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
AUDITORS |
The auditors, CavanaghKelly, have indicated their willingness to continue in office in accordance with the provision of Section 485 of the Companies Act 2006. |
ON BEHALF OF THE BOARD: |
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF |
SEATING MATTERS LTD |
Opinion |
We have audited the financial statements of Seating Matters Ltd (the 'Company') for the year ended 31 December 2022 which comprise the Income Statement, Statement of Financial Position, 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 Directors' Report, but does not include the financial statements and our Auditors' Report 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 Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements. |
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF |
SEATING MATTERS LTD |
Matters on which we are required to report by exception |
In the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Directors' Report. |
We have nothing to report in respect of the following matters 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 Directors' Responsibilities Statement set out on page four, 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. |
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF |
SEATING MATTERS LTD |
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 an Auditors' Report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. |
Explanation as to what extent the audit was considered capable of detecting irregularities, |
including fraud |
Irregularities, including fraud, are instances of non-compliance with laws and regulations. The objectives of our audit in respect of fraud are to assess the risk of material misstatement due to fraud, design and implement appropriate responses to those assessed risks and to respond appropriately to instances of fraud or suspected fraud identified during the course of our audit. However, the primary responsibility for the prevention and detection of fraud rests with management and those charged with governance of the company. |
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, our procedures included the following: |
- | We obtained an understanding of the legal and regulatory requirements applicable to the company’s financial statements and considered the most significant are the Companies Act 2006, Financial Reporting Standards (FRS102) and UK taxation legislation; |
- | We have assessed the risk of material misstatement of the financial statements, including risk of material misstatement due to fraud and how it might occur by holding discussions with management and those charged with governance; |
- | We enquired of management and those charged with governance as to any known instances of non-compliance or suspected non-compliance with laws and regulations; |
- | We obtained understanding of the internal controls established to mitigate risks related to fraud or non-compliance with laws and regulations; and |
- | We held discussions amongst the audit engagement team regarding how fraud might occur in the financial statements and any potential indicators of fraud. As part of this discussion we identified the following potential areas where fraud may occur: timing of revenue recognition and management override. |
The audit response to risks identified included: |
- | Reviewing the financial statements disclosures and testing to supporting documentation to assess compliance with the relevant laws and regulations above; |
- | Performing analytical procedures to identify any unusual or unexpected relationships that may indicate risk of material misstatement due to fraud; |
- | In addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments, assessing whether the judgements made in making accounting estimates are reasonable and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business. |
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 Auditors' Report. |
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF |
SEATING MATTERS LTD |
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 an Auditors' Report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's 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 Auditors |
36-38 Northland Row |
Dungannon |
Co. Tyrone |
BT71 6AP |
SEATING MATTERS LTD (REGISTERED NUMBER: NI057995) |
INCOME STATEMENT |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
2022 | 2021 |
Notes | £ | £ |
REVENUE | 5 |
Cost of sales | ( |
) | ( |
) |
GROSS PROFIT |
Administrative expenses | ( |
) | ( |
) |
1,684,928 | 2,539,007 |
Other operating income |
OPERATING PROFIT | 7 |
Finance income |
2,026,218 | 2,737,368 |
Gain/loss on revaluation of investments | - | 77,463 |
2,026,218 | 2,814,831 |
Finance costs | 8 | ( |
) |
PROFIT BEFORE TAXATION |
Tax on profit | 9 | ( |
) | ( |
) |
PROFIT FOR THE FINANCIAL YEAR |
OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE INCOME FOR THE YEAR |
SEATING MATTERS LTD (REGISTERED NUMBER: NI057995) |
STATEMENT OF FINANCIAL POSITION |
31 DECEMBER 2022 |
2022 | 2021 |
Notes | £ | £ |
NON-CURRENT ASSETS |
Intangible assets | 12 |
Property, plant and equipment | 13 |
Investment property | 14 |
CURRENT ASSETS |
Inventories | 15 |
Receivables | 16 |
Cash at bank and in hand |
PAYABLES |
Amounts falling due within one year | 17 | ( |
) | ( |
) |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
PROVISIONS FOR LIABILITIES | 18 | ( |
) | ( |
) |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 19 |
Capital redemption reserve | 20 |
Retained earnings | 20 |
SHAREHOLDERS' FUNDS |
The financial statements were approved by the Board of Directors and authorised for issue on |
SEATING MATTERS LTD (REGISTERED NUMBER: NI057995) |
STATEMENT OF CHANGES IN EQUITY |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
Called up | Capital |
share | Retained | redemption | Total |
capital | earnings | reserve | equity |
£ | £ | £ | £ |
Balance at 1 January 2021 |
Changes in equity |
Dividends | - | ( |
) | - | ( |
) |
Total comprehensive income | - |
Balance at 31 December 2021 |
Changes in equity |
Dividends | - | ( |
) | - | ( |
) |
Total comprehensive income | - |
Balance at 31 December 2022 |
SEATING MATTERS LTD (REGISTERED NUMBER: NI057995) |
NOTES TO THE FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
1. | STATUTORY INFORMATION |
Seating Matters Ltd is a |
The presentation currency of the financial statements is the Pound Sterling (£). |
2. | STATEMENT OF COMPLIANCE |
3. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
The financial statements have been prepared on the going concern basis and in accordance with the historical cost convention modified when necessary to include the revaluation of certain fixed assets. |
The accounting policies detailed below have been applied consistently throughout the year. |
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. |
Revenue |
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the group and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised: |
Sale of goods |
Revenue from the sale of goods is recognised when all of the following conditions are satisfied: |
- the significant risks and rewards of ownership have been transferred to the buyer; |
- the company retains no continuing involvement or control over the goods; |
- the amount of revenue can be measured reliably; |
- it is probable that future economic benefits will flow through the company |
- the costs incurred or to be incurred in respect of the transaction can be measured reliably. |
Rendering of services and contracting |
Revenue from a contract to provide services is recognised in the period in which the serves are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied: |
- the amount of revenue can be measured reliably; |
- it is probable that the company will receive the consideration due under the contract; |
- the stage of completion of the contract at the end of the reporting period can be measured |
reliably, and; |
- the costs incurred and the costs to complete the contract can be measured reliably. |
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. |
Computer software is being amortised evenly over its estimated useful life of 4 years. |
SEATING MATTERS LTD (REGISTERED NUMBER: NI057995) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
3. | ACCOUNTING POLICIES - continued |
Property, plant and equipment |
Property, plant and equipment are stated at cost or at valuation, less accumulated depreciation. Cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management. |
The charge to depreciation is calculated to write off the original cost or valuation of property, plant and equipment, less their estimated residual value, over their expected useful lives as follows: |
Freehold property | - 4% Straight Line |
Plant and machinery | - 25% Straight Line |
Fixtures and fittings | - 15% Straight Line |
Motor vehicles | - 25% Reducing Balance |
The carrying values of property, plant and equipment are reviewed annually for impairment in periods if events or changes in circumstances indicate the carrying value may not be recoverable. |
Investment property |
Investment property is carried at fair value, derived from the current market prices for comparable real estate determined annually. The valuations use observable market prices, adjusted if necessary for any difference in the nature, location or condition of the specific asset. Changes in fair value are recognised in the Income Statement. |
Income from investment property is recognised in the Income Statement as rental income. |
Inventories |
Inventories are valued at the lower of cost and net realisable value. Cost comprises expenditure incurred in the normal course of business in bringing inventories to their present location and condition. |
Full provision is made for obsolete and slow moving items. Net realisable value comprises actual or estimated selling price (net of trade discounts) less all further costs to completion or to be incurred in marketing and selling. |
SEATING MATTERS LTD (REGISTERED NUMBER: NI057995) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
3. | ACCOUNTING POLICIES - continued |
Financial instruments |
The company have chosen to adopt Sections 11 and 12 of FRS 102 in respect of financial instruments. |
(i) Financial assets |
Basic financial assets, including trade and other receivables, cash and bank balances and amounts owed by related parties are initially recognised 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. Such assets are subsequently carried at amortised cost using the effective interest method. |
At the end of each reporting period financial assets measured at amortised cost are assessed for objective evidence of impairment. If an asset is impaired the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset's original effective interest rate. The impairment loss is recognised in profit or loss. |
If there is decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss. |
Financial assets are derecognised when (a) the contractual rights to the cash flows from the asset expire or are settled, or (b) substantially all the risks and rewards of the ownership of the asset are transferred to another party or (c) despite having retained some significant risks and rewards of ownership, control of the asset has been transferred to another party who has the practical ability to unilaterally sell the asset to an unrelated third party without imposing additional restrictions. |
(ii) Financial liabilities |
Basic financial liabilities, including trade and other payables, bank loans and overdrafts and amounts owed to related parties 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 receipts discounted at a market rate of interest. Debt instruments are subsequently carried at amortised cost, using the effective interest rate method. Fees paid on the establishment of loan facilities are recognised as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw-down occurs. To the extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalised as a pre-payment for liquidity services and amortised over the period of the facility to which it relates. |
Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts 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 payables are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method. |
Financial liabilities are derecognised when the liability is extinguished, that is when the contractual obligation is discharged, cancelled or expires. |
(iii) Offsetting |
Financial assets and liabilities are offset and 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. |
SEATING MATTERS LTD (REGISTERED NUMBER: NI057995) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
3. | ACCOUNTING POLICIES - continued |
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 tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the statement of financial position date. |
Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position 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 statement of financial position date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result. |
Hire purchase and leasing commitments |
Property, plant and equipment held under leasing and Hire Purchases arrangements which transfer substantially all the risks and rewards of ownership to the company are capitalised and included in the Statement of Financial Position at their cost or valuation, less depreciation. The corresponding commitments are recorded as liabilities. Payments in respect of these obligations are treated as consisting of capital and interest elements, with interest charged to the Income Statement. |
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 Income Statement in the period to which they relate. |
Cash and cash equivalents |
Cash and cash equivalents includes cash in hand and deposits held at call with banks. |
Share capital |
Ordinary Shares are classified as equity. Incremental costs directly attributable to the issue of new ordinary shares are shown in equity as a deduction, net of tax, from the proceeds. |
Distributions to equity holders |
Dividends and other distributions to the Company's shareholders are recognised as a liability in the financial statements in the period in which the dividends and other distributions are approved by the Company's shareholders. These amounts are recognised in the statement of changes in equity. |
SEATING MATTERS LTD (REGISTERED NUMBER: NI057995) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
4. | CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY |
Judgements In applying accounting policies and key sources of estimation uncertainty |
Estimates and judgements are continually evaluated and are based on historical experiences and other factors, including expectations of future events that are believed to be reasonable under the circumstances. |
(a) Critical judgements in applying the entity's accounting policies |
There are no critical judgements in applying the entity's accounting policies. |
(b) Key accounting estimates and assumptions |
Warranty Provision |
The company offers a warranty for any faulty goods sold. Provision is made for potential claims under warranty for goods which have been returned. Management review the level of sales and the number of warranty claims made on a regular basis in order to calculate the provision for future claims for goods sold. |
5. | REVENUE |
All turnover is derived from the company's principal activities. No analysis of turnover is presented as the directors consider disclosure to be seriously prejudicial to the interests of the company. |
6. | EMPLOYEES AND DIRECTORS |
2022 | 2021 |
£ | £ |
Wages and salaries |
Social security costs |
Other pension costs |
The average number of employees during the year was as follows: |
2022 | 2021 |
Production and processing | 33 | 33 |
Administrative | 22 | 20 |
2022 | 2021 |
£ | £ |
Directors' remuneration |
7. | OPERATING PROFIT |
The operating profit is stated after charging/(crediting): |
2022 | 2021 |
£ | £ |
Commissions payable |
Depreciation - owned assets |
Loss/(profit) on disposal of fixed assets | ( |
) |
Computer software amortisation |
Auditors' remuneration |
Foreign exchange differences | ( |
) |
SEATING MATTERS LTD (REGISTERED NUMBER: NI057995) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
8. | FINANCE COSTS |
2022 | 2021 |
£ | £ |
Hire purchase interest |
9. | 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 |
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: |
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 |
Income not taxable for tax purposes | ( |
) |
Capital allowances in excess of depreciation | - | ( |
) |
Adjustments to tax charge in respect of previous periods |
Tax benefit of SME R&D relief | (351,666 | ) | (281,001 | ) |
Impact of super deduction | (3,133 | ) | - |
Impact of rate change | 453 | - |
Adjustments in respect of prior periods | 1,349 | - |
Group relief (claimed)/surrendered | (26,491 | ) | - |
Non relevant depreciation | 697 | - |
Deferred tax movements | - | 22,132 |
Total tax charge | 6,242 | 211,616 |
10. | DIVIDENDS |
2022 | 2021 |
£ | £ |
Ordinary Shares shares of 0.0079 each |
Interim |
11. | PRIOR YEAR ADJUSTMENTS |
Certain classes of transactions have been reclassed in the prior year to be brought into line with the current year classification. There has been no impact to the results of the prior year. |
SEATING MATTERS LTD (REGISTERED NUMBER: NI057995) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
12. | INTANGIBLE FIXED ASSETS |
Patents and | Computer |
licences | software | Totals |
£ | £ | £ |
COST |
At 1 January 2022 |
and 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 |
13. | PROPERTY, PLANT AND EQUIPMENT |
Fixtures |
Long | Plant and | and | Motor |
leasehold | machinery | fittings | vehicles | Totals |
£ | £ | £ | £ | £ |
COST |
At 1 January 2022 |
Additions |
Disposals | ( |
) | ( |
) |
At 31 December 2022 |
DEPRECIATION |
At 1 January 2022 |
Charge for year |
Eliminated on disposal | ( |
) | ( |
) |
At 31 December 2022 |
NET BOOK VALUE |
At 31 December 2022 |
At 31 December 2021 |
14. | INVESTMENT PROPERTY |
Total |
£ |
FAIR VALUE |
At 1 January 2022 |
and 31 December 2022 |
NET BOOK VALUE |
At 31 December 2022 |
At 31 December 2021 |
The directors consider that such valuations are reflective of the open market value of the property at 31 December 2022. |
SEATING MATTERS LTD (REGISTERED NUMBER: NI057995) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
14. | INVESTMENT PROPERTY - continued |
Fair value at 31 December 2022 is represented by: |
£ |
Valuation in 2021 | 77,463 |
Cost | 697,537 |
775,000 |
Investment Properties were subject to independent, professional valuations at 31 December 2021 by DMC Properties and Mortgages Ltd. |
The valuations were undertaken in accordance with the Appraisal and Valuation Manual of the Royal Institute of Chartered Surveyors in the United Kingdom. |
15. | INVENTORIES |
2022 | 2021 |
£ | £ |
Finished goods |
There is no material difference between the replacement cost of inventories and their balance sheet values. |
16. | RECEIVABLES |
2022 | 2021 |
£ | £ |
Trade receivables |
Amounts owed by group undertakings |
Amounts owed by participating interests | 49,592 | 21,355 |
Other receivables |
Directors' current accounts | - | 39,718 |
Tax |
Prepayments and accrued income |
The amounts owing by the group undertakings are interest free and receivable on demand. |
17. | PAYABLES: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2022 | 2021 |
£ | £ |
Trade payables |
Amounts owed to group undertakings |
Tax |
Social security and other taxes |
VAT | 10,497 | 45,287 |
Other payables |
Accruals and deferred income |
The amounts owed to the group undertakings are interest free and repayable on demand. |
SEATING MATTERS LTD (REGISTERED NUMBER: NI057995) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
18. | PROVISIONS FOR LIABILITIES |
2022 | 2021 |
£ | £ |
Deferred tax | 65,694 | 62,749 |
Warranty provision | 374,159 | 148,641 |
Deferred | Warranty |
tax | provision |
£ | £ |
Balance at 1 January 2022 |
Utilised during year |
Balance at 31 December 2022 |
The company offers a warranty for any goods sold. Provision is made for potential claims under warranty for goods which have a default. Management review the level of sales and the number of warranty claims made on a regular basis in order to calculate the provision for future claims for goods sold. |
19. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2022 | 2021 |
value: | £ | £ |
Ordinary Shares | 0.0079 | 1 | 1 |
20. | RESERVES |
Capital |
Retained | redemption |
earnings | reserve | Totals |
£ | £ | £ |
At 1 January 2022 | 3,507,027 |
Profit for the year |
Dividends | ( |
) | ( |
) |
At 31 December 2022 | 5,027,003 |
21. | RELATED PARTY DISCLOSURES |
The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group. |
Amounts of £49,592 (2021: £21,355) were due at the year end to the company by Related Parties. The Related Parties are related by virtue of ultimate common shareholder and/or directors. |
Included within Other Receivables is a balance of £252,048 (2021: £266,813) in respect of money due to the company from 'close family members'. |
22. | PARENT AND ULTIMATE PARENT COMPANY |
The company regards Phoenix James Limited as its parent company. |
The company's ultimate parent undertaking is Phoenix James Limited. The address of Phoenix James Limited is 131 Carnamuff Road, Ballykelly, Limavady, Northern Ireland, BT49 9JG. |
SEATING MATTERS LTD (REGISTERED NUMBER: NI057995) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31 DECEMBER 2022 |
23. | COMMITMENTS UNDER OPERATING LEASES |
At 31 December, the company had future minimum lease payments under non-cancellable operating leases as follows: |
2022 | 2021 |
£ | £ |
Land and buildings expiry date: |
Within 1 year | 189,333 | 189,333 |
Within 1-2 years | 189,336 | 189,333 |
Within 2-5 years | 169,336 | 378,666 |
548,008 | 757,332 |