REGISTERED NUMBER: |
Strategic Report, Report of the Directors and |
Financial Statements for the Year Ended 31 October 2022 |
for |
Mona Tractor Company Limited |
REGISTERED NUMBER: |
Strategic Report, Report of the Directors and |
Financial Statements for the Year Ended 31 October 2022 |
for |
Mona Tractor Company Limited |
Mona Tractor Company Limited (Registered number: 01567069) |
Contents of the Financial Statements |
for the Year Ended 31 October 2022 |
Page |
Company Information | 1 |
Strategic Report | 2 |
Report of the Directors | 5 |
Report of the Independent Auditors | 7 |
Income Statement | 10 |
Other Comprehensive Income | 11 |
Balance Sheet | 12 |
Statement of Changes in Equity | 13 |
Cash Flow Statement | 14 |
Notes to the Cash Flow Statement | 15 |
Notes to the Financial Statements | 17 |
Mona Tractor Company Limited |
Company Information |
for the Year Ended 31 October 2022 |
DIRECTORS: |
SECRETARY: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
SENIOR STATUTORY AUDITOR: |
AUDITORS: |
Chartered Accountants, Statutory Auditor |
2nd Floor Refuge House |
33-37 Watergate Row |
Chester |
CH1 2LE |
Mona Tractor Company Limited (Registered number: 01567069) |
Strategic Report |
for the Year Ended 31 October 2022 |
The directors present their strategic report for the year ended 31 October 2022. |
Mona Tractor Company Limited (the company) is principally engaged in the sale, servicing and maintenance of agricultural and horticultural tractors & machinery in the north of Wales. |
REVIEW OF BUSINESS |
This review is written to present a balanced and comprehensive review of the development and performance of our business and its position at the year end. Our review is consistent with the size and nature if our business and it includes an assessment of the risks and uncertainties that we face. |
The results of the business are set out in the Income Statement, and these show a profit on ordinary activities before tax of £635,712 (2021: £491,760). |
The company's continued association with John Deere, the dedication shown by members of each of our outlets, together with constant review of overheads by the directors have all contributed to the results in the year ended 31 October 2022. |
The performance of the company demonstrates its commitment to quality offerings and customer service, as despite the challenging and uncertain market conditions that the agricultural industry is facing, not least due to legacy issues surrounding Brexit & Covid-19 restrictions, but also the increase in cost of most goods & services, interest rate & inflationary pressures on the company and our customers etc. Despite this the company's turnover and profit before tax remained stable. This being the case, the business will aim to continue to build upon the strong underlying platform created in this and previous years as it continues to grow. |
As a direct result of the Covid-19 restrictions continuing into a second year, the company received £13,500 (2021: £39,300) in direct government assistance from national and local Governments, and this came in the form of business rate grants, furlough scheme receipts and business interruption payments arising on the Coronavirus business interruption loan taken up in the prior period. 50% of this loan was repaid in the current period. |
During the current financial period, the company has continued to invest in products, people, and service offerings in order to carry on providing a high level of customer service and satisfaction, whilst at the same time attempting to mitigate any conditions, occurrences and risks that are outside of its control. |
The business is well placed to continue to grow profitably, maintain reasonable margins and develop both its product and servicing offerings to new and existing customers. |
The directors have also taken full consideration of the impact on the business of the current global environment & markets. Based upon the level of support available by the stakeholders and the co-operation of its employees, the directors are confident that the ongoing impact of world events will not detrimentally inhibit the ability of the company to trade on similar terms to those in place before the 2020 Covid-19 restrictions were announced. |
The directors are pleased to report an increase in profit and turnover. This is reflected in the Key Performance Indicators shown below. |
Mona Tractor Company Limited (Registered number: 01567069) |
Strategic Report |
for the Year Ended 31 October 2022 |
PRINCIPAL RISKS AND UNCERTAINTIES |
The company continues to be an important part of the agricultural community in the north of Wales and sees itself as a key part of the materials handling and facilities service sectors in the region. In order that the company's position in these markets is not unduly compromised, there is a clear risk management strategy in place which enables and supports the business and helps in the identification and management of perceived risks. |
The principal future risk remains the tightness of finance available to our credit customers. While uncertainty remains in the agricultural sector and subsidies continue to contract, trading may possibly see some eventual signs of contraction. |
Finance risk |
The company finances its activities through a combination of directors' loans, bank loans, hire purchase contracts and cash deposits. Overdrafts are used to satisfy short term cash flow requirements. Other financial assets and liabilities, such as trade debtors and trade creditors, arise directly from the company's operating activities. The company does not trade in financial instruments and has no form of financial derivatives. Currently the company does not generally trade outside of the United Kingdom and is not therefore exposed to foreign currency risk. |
The main risk associated with the company's financial assets and liabilities are set out below, together with the policies adopted by the directors for their management. |
Interest rate risk |
The company pays fixed rates of interest on most of its borrowings. As a result of using fixed rates, the directors take the view that the current level of loan debt, including the remaining funding, taken out as a result of Covid-19, does not necessitate any hedging action to reduce the risk but this policy is kept under periodical review. |
Credit Risk |
The directors' objective is to actively manage the risk of financial loss due to bad debts. Standard payment terms call for regular monthly payments in full within 30 days of the month end. The credit worthiness of customers is assessed before a contract is entered into with them. The company also actively manages the collection of payments to ensure that they are received promptly and in accordance with agreed terms, thereby ensuring that the company's exposure to bad debt is minimised. |
Brexit |
The left the EU on 31 January 2020 and despite the amended protocols etc now being in place, there are still some issues arising as a result of this. As the market relating to agricultural machinery etc. is international, the directors are constantly monitoring and adjusting forecasts and projections in line with the development of the new cross border regimes. |
Coronavirus |
The restrictions announced in March 2020 continued in some form throughout the current period but have eased significantly in recent times. The impact of restrictions, put in place by the Welsh Government, are still being felt, but the directors have been able to safely ease the implemented measures, designed to minimise disruption and protect its employees and customers, and this has meant that the current year has been more in line with historic norms & practices. |
Global events |
Partly resulting from the steps taken by Governments to deal with Coronavirus, both inflation and interest rates are now on the rise. As already mentioned, the company has assessed its internal interest rate risk, but the inflationary pressure on cost will result in increased costs, which will eventually need to be passed on to the customers, but the company will always hold out as long as possible so as to ensure that the customer received the best deal. |
The increase in the cost of goods & services will also undoubtedly affect our customers buying power, and so competitiveness will be key to maintaining the current level of profitability. |
Mona Tractor Company Limited (Registered number: 01567069) |
Strategic Report |
for the Year Ended 31 October 2022 |
FINANCIAL KEY PERFORMANCE INDICATORS (KPI'S) |
The board monitors the progress of the company with regard to a number of KPI's, |
2022 | 2021 |
Turnover | £16,886,491 | £12,561,116 |
Earnings before interest & tax | £676,984 | £535,839 |
Profit before tax | £635,712 | £491,760 |
Headcount | 45 | 42 |
NON-FINANCIAL KEY PERFORMANCE INDICATORS |
The directors consider it crucial that the company maintains a reputation for the highest standards of business conduct and are responsible for setting, reviewing and upholding the culture, values and standards of this family business. As such the directors seek to sustain and develop its strong & stable partnership with all of the company's customers, employees & suppliers, and provide outstanding service & products. |
The key non-financial performance indicators are therefore deemed to be: |
Our People: |
The success of the business relies on attracting, retaining and motivating our team, and so seek to ensure that the company is an inspiring place to work. |
Our Customers: |
The company continually assesses the priorities related to customers so as to enhance and maintain relationships over the long-term and so we regularly engage with all our customers base to keep abreast of their requirements. |
Our Suppliers: |
The company maintains a high level of engagement with all of its suppliers, but particularly our key brand partners, John Deere, with whom a constant dialogue is maintained. This being so as to ensure the brands are represented to the best of the company's ability and that all of their high standards are not only met, but surpassed. |
In addition to the above, environmental matters are monitored, reviewed and where possible improvement actions implemented by the directors in order to improve the company's environmental credentials. |
ON BEHALF OF THE BOARD: |
Mona Tractor Company Limited (Registered number: 01567069) |
Report of the Directors |
for the Year Ended 31 October 2022 |
The directors present their report with the financial statements of the company for the year ended 31 October 2022. |
PRINCIPAL ACTIVITY |
The principal activity of the company in the year under review was that of the sale, servicing, and maintenance of agricultural and horticultural tractors & machinery in the north of Wales. |
DIVIDENDS |
No dividends will be distributed for the year ended 31 October 2022. |
FUTURE DEVELOPMENTS |
The company will continue to focus on its brand development, customer service and product offering. |
DIRECTORS |
The directors shown below have held office during the whole of the period from 1 November 2021 to the date of this report. |
DISCLOSURE IN THE STRATEGIC REPORT |
The company has chosen to set out in the strategic report some information required by medium sized companies to be contained in the report of the directors. It has done so in respect of the business review and principal risks and uncertainties. |
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). 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. |
The directors are also responsible for assessing the position of the company with regard its going concern status for a period of at least 12 months from the date they approve the financial statements. |
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 or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the company's auditors are aware of that information. |
Mona Tractor Company Limited (Registered number: 01567069) |
Report of the Directors |
for the Year Ended 31 October 2022 |
AUDITORS |
The auditors, Champion Accountants LLP, 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 |
Mona Tractor Company Limited |
Opinion |
We have audited the financial statements of Mona Tractor Company Limited (the 'company') for the year ended 31 October 2022 which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement and Notes to the Cash Flow Statement, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice). |
In our opinion the financial statements: |
- | give a true and fair view of the state of the company's affairs as at 31 October 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 |
Mona Tractor Company 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 page 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. |
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 auditor's 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. |
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below: |
The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: |
The responsibility for the prevention and detection of irregularities, including fraud, lies with the directors and with those charged with governance. The objectives of our audit in respect of irregularities and fraud are to assess the risk of material misstatement of the financial statements due to fraud, to obtain sufficient, appropriate audit evidence regarding the assessed risks and to respond appropriately to fraud or suspected fraud identified during the audit. |
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors. |
Report of the Independent Auditors to the Members of |
Mona Tractor Company Limited |
Audit procedures |
We determine significant applicable laws and regulations through discussion with those charged with governance and our own knowledge of the industry and design audit procedures to help identify instances of non-compliance with those laws and regulations that may have a material effect on the financial statements. |
Our approach is to consider the legal and regulatory frameworks directly applicable to the financial statements reporting framework ((FRS 102 and the Companies Act 2006) and the relevant tax compliance regulations in the UK; the nature of the industry; the business performance and the key drivers for management remuneration; the control environment and the procedures in place to address identified risks, including management override, non-compliance with laws and regulations and to prevent and detect fraud or irregularity. We communicate identified laws and regulations throughout our team and remain alert to any indications of non-compliance throughout the audit. |
Our procedures are designed to provide reasonable assurance that the financial statements are free from material misstatement or error and include: enquiries of management and of staff in key compliance functions; review of minutes of meetings of those charged with governance; review and testing of manual journals and significant transactions outside the normal course of business; review of financial statement disclosures and testing to supporting documentation; performance of analytical procedures. |
We are not responsible for preventing non-compliance and due to the inherent limitations of an audit, as described above, the audit cannot be relied upon to detect all instances of non-compliance with laws and regulations. |
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, Statutory Auditor |
2nd Floor Refuge House |
33-37 Watergate Row |
Chester |
CH1 2LE |
Mona Tractor Company Limited (Registered number: 01567069) |
Income Statement |
for the Year Ended 31 October 2022 |
31.10.22 | 31.10.21 |
Notes | £ | £ |
TURNOVER |
Cost of sales |
GROSS PROFIT |
Administrative expenses |
663,484 | 496,491 |
Other operating income |
OPERATING PROFIT | 6 |
Interest payable and similar expenses | 7 |
PROFIT BEFORE TAXATION |
Tax on profit | 8 |
PROFIT FOR THE FINANCIAL YEAR |
Mona Tractor Company Limited (Registered number: 01567069) |
Other Comprehensive Income |
for the Year Ended 31 October 2022 |
31.10.22 | 31.10.21 |
Notes | £ | £ |
PROFIT FOR THE YEAR |
OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE INCOME FOR THE YEAR |
Mona Tractor Company Limited (Registered number: 01567069) |
Balance Sheet |
31 October 2022 |
31.10.22 | 31.10.21 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Tangible assets | 10 |
CURRENT ASSETS |
Stocks | 11 |
Debtors | 12 |
Cash at bank and in hand |
CREDITORS |
Amounts falling due within one year | 13 |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
CREDITORS |
Amounts falling due after more than one year |
14 |
( |
) |
( |
) |
PROVISIONS FOR LIABILITIES | 18 | ( |
) | ( |
) |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 19 |
Retained earnings | 20 |
SHAREHOLDERS' FUNDS |
The financial statements were approved by the Board of Directors and authorised for issue on |
Mona Tractor Company Limited (Registered number: 01567069) |
Statement of Changes in Equity |
for the Year Ended 31 October 2022 |
Called up |
share | Retained | Total |
capital | earnings | equity |
£ | £ | £ |
Balance at 1 November 2020 |
Changes in equity |
Dividends | - | ( |
) | ( |
) |
Total comprehensive income | - |
Balance at 31 October 2021 |
Changes in equity |
Total comprehensive income | - |
Balance at 31 October 2022 |
Mona Tractor Company Limited (Registered number: 01567069) |
Cash Flow Statement |
for the Year Ended 31 October 2022 |
31.10.22 | 31.10.21 |
Notes | £ | £ |
Cash flows from operating activities |
Cash generated from operations | 1 |
Interest paid | ( |
) | ( |
) |
Interest element of hire purchase payments paid |
( |
) |
( |
) |
Tax paid | ( |
) | ( |
) |
Net cash from operating activities |
Cash flows from investing activities |
Purchase of tangible fixed assets | ( |
) | ( |
) |
Sale of tangible fixed assets |
Net cash from investing activities | ( |
) | ( |
) |
Cash flows from financing activities |
New loans in year |
Loan repayments in year | ( |
) | ( |
) |
New Hire purchases in year | 14,450 | - |
Capital repayments in year | ( |
) | ( |
) |
Amount withdrawn by directors | (82,000 | ) | (200,000 | ) |
Equity dividends paid | ( |
) |
Net cash from financing activities | ( |
) |
Increase/(decrease) in cash and cash equivalents | ( |
) |
Cash and cash equivalents at beginning of year |
2 |
(56,831 |
) |
423,218 |
Cash and cash equivalents at end of year | 2 | 271,695 | ( |
) |
Mona Tractor Company Limited (Registered number: 01567069) |
Notes to the Cash Flow Statement |
for the Year Ended 31 October 2022 |
1. | RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS |
31.10.22 | 31.10.21 |
£ | £ |
Profit before taxation |
Depreciation charges |
Loss/(profit) on disposal of fixed assets | ( |
) |
Government grants | ( |
) | ( |
) |
Finance costs | 41,272 | 44,079 |
777,709 | 593,324 |
Increase in stocks | ( |
) | ( |
) |
Increase in trade and other debtors | ( |
) | ( |
) |
Increase in trade and other creditors |
Cash generated from operations |
2. | CASH AND CASH EQUIVALENTS |
The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts: |
Year ended 31 October 2022 |
31.10.22 | 1.11.21 |
£ | £ |
Cash and cash equivalents | 271,695 | 21 |
Bank overdrafts | ( |
) |
271,695 | (56,831 | ) |
Year ended 31 October 2021 |
31.10.21 | 1.11.20 |
£ | £ |
Cash and cash equivalents | 21 | 423,218 |
Bank overdrafts | ( |
) |
(56,831 | ) | 423,218 |
Mona Tractor Company Limited (Registered number: 01567069) |
Notes to the Cash Flow Statement |
for the Year Ended 31 October 2022 |
3. | ANALYSIS OF CHANGES IN NET DEBT |
At 1.11.21 | Cash flow | At 31.10.22 |
£ | £ | £ |
Net cash |
Cash at bank and in hand | 21 | 271,674 | 271,695 |
Bank overdrafts | (56,852 | ) | 56,852 | - |
(56,831 | ) | 271,695 |
Debt |
Finance leases | (6,123 | ) | (4,979 | ) | (11,102 | ) |
Debts falling due within 1 year | (90,491 | ) | (57,814 | ) | (148,305 | ) |
Debts falling due after 1 year | (368,265 | ) | (127,215 | ) | (495,480 | ) |
(464,879 | ) | (190,008 | ) | (654,887 | ) |
Total | (521,710 | ) | 138,518 | (383,192 | ) |
Mona Tractor Company Limited (Registered number: 01567069) |
Notes to the Financial Statements |
for the Year Ended 31 October 2022 |
1. | STATUTORY INFORMATION |
Mona Tractor Company Limited is a |
The presentation currency of the financial statements is the Pound Sterling (£). |
2. | GOING CONCERN |
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 to adopt the going concern basis of accounting in preparing the financial statements. |
The directors have taken full consideration of the impact on the company of Covid-19 and Brexit, and these are discussed in more detail in the strategic report and the report of the directors. |
The financial statements have also been prepared in accordance with the Companies Act 2006 and applicable accounting standards in the United Kingdom. |
3. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. |
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 are shown net of value added tax and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates. |
Revenue from the sale of goods is recognised when the significant risk and reward of ownership is passed to the buyer (usually on hand over or 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. |
Tangible fixed assets |
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses, Historical 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. |
Land is not depreciated. Depreciation on other assets is provided at the following annual rates in order to allocate the cost of the assets, less their residual value, over their estimated useful lives: |
- Leasehold improvements - 5% on cost, which represents a 20 year write down period. |
- Plant and machinery - 25% on cost |
- Motor vehicles - 25% on cost |
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively as appropriate, or if there is an indication of a significance change since the last reporting date. |
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the profit & loss. |
Mona Tractor Company Limited (Registered number: 01567069) |
Notes to the Financial Statements - continued |
for the Year Ended 31 October 2022 |
3. | ACCOUNTING POLICIES - continued |
Stocks |
Stocks are stated at the lower of cost & net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a weighted average basis. |
Work in progress and finished goods include labour and attributable overheads. |
At each balance sheet date, stocks are assessed for impairment. If stocks are impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised in the profit & loss immediately. |
Finance & borrowing costs |
Finance costs |
Finance costs are charged to the profit & loss over the term of the debt using the effective interest method. Issue costs are recognised as they are incurred. |
Borrowing costs |
All borrowing costs are recognised in the profit & loss in the year in which they are incurred. |
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 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. |
Cash & cash equivalents |
Cash represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value. |
Provision for liabilities |
Provisions are made where an event has taken place that gives the company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation. |
Provisions are charged as an expense to the profit & loss in the year that the company becomes aware of the obligation, and are measured at the best estimate at the balance sheet date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties. |
When payments are eventually made, they are charged to the provision carried in the balance sheet. |
Mona Tractor Company Limited (Registered number: 01567069) |
Notes to the Financial Statements - continued |
for the Year Ended 31 October 2022 |
3. | ACCOUNTING POLICIES - continued |
Hire purchase and leasing commitments |
Assets obtained under hire purchase contracts or finance leases are capitalised in the balance sheet. Those held under hire purchase contracts are depreciated over their estimated useful lives. Those held under finance leases are depreciated over their estimated useful lives or the lease term, whichever is the shorter. |
The interest element of these obligations is charged to profit or loss over the relevant period. The capital element of the future payments is treated as a liability. |
Pension costs and other post-retirement benefits |
The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate. |
Debtors & creditors |
Debtors |
Short term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less impairments. |
Creditors |
Short term creditors are measured at transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method. |
Judgements and key sources of estimation uncertainty |
In the application of the company's accounting policies, the directors are required to make judgments, estimates and assumptions about 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 as well as future periods, where the revision affects both current and future periods. |
Financial instruments |
The company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in non-puttable ordinary shares. |
4. | EMPLOYEES AND DIRECTORS |
31.10.22 | 31.10.21 |
£ | £ |
Wages and salaries |
Social security costs |
Other pension costs |
The average number of employees during the year was as follows: |
31.10.22 | 31.10.21 |
Directors | 2 | 2 |
Employees | 43 | 40 |
Mona Tractor Company Limited (Registered number: 01567069) |
Notes to the Financial Statements - continued |
for the Year Ended 31 October 2022 |
5. | DIRECTORS' EMOLUMENTS |
31.10.22 | 31.10.21 |
£ | £ |
Directors' remuneration |
6. | OPERATING PROFIT |
The operating profit is stated after charging/(crediting): |
31.10.22 | 31.10.21 |
£ | £ |
Depreciation - owned assets |
Depreciation - assets on hire purchase contracts |
Loss/(profit) on disposal of fixed assets | ( |
) |
Auditors' remuneration |
Accountancy and taxation compliance services |
Grant income | ( |
) |
7. | INTEREST PAYABLE AND SIMILAR EXPENSES |
31.10.22 | 31.10.21 |
£ | £ |
Bank loan interest |
Other loan interest |
Hire purchase |
8. | TAXATION |
Analysis of the tax charge |
The tax charge on the profit for the year was as follows: |
31.10.22 | 31.10.21 |
£ | £ |
Current tax: |
UK corporation tax |
Deferred tax | ( |
) |
Tax on profit |
Mona Tractor Company Limited (Registered number: 01567069) |
Notes to the Financial Statements - continued |
for the Year Ended 31 October 2022 |
8. | TAXATION - continued |
Reconciliation of total tax charge included in profit and loss |
The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below: |
31.10.22 | 31.10.21 |
£ | £ |
Profit before tax |
Profit multiplied by the standard rate of corporation tax in the UK of (2021 - |
Effects of: |
Income not taxable for tax purposes | ( |
) | ( |
) |
Depreciation in excess of capital allowances |
Adjustments to tax charge in respect of previous periods | ( |
) |
property |
Deferred tax movement | 11,370 | (8,004 | ) |
s455 | 7,424 | - |
Total tax charge | 138,183 | 74,182 |
9. | DIVIDENDS |
31.10.22 | 31.10.21 |
£ | £ |
Ordinary shares of £1 each |
Interim |
10. | TANGIBLE FIXED ASSETS |
Leasehold | Plant and | Motor |
improvements | machinery | vehicles | Totals |
£ | £ | £ | £ |
COST |
At 1 November 2021 |
Additions |
Disposals | ( |
) | ( |
) | ( |
) |
At 31 October 2022 |
DEPRECIATION |
At 1 November 2021 |
Charge for year |
Eliminated on disposal | ( |
) | ( |
) | ( |
) |
At 31 October 2022 |
NET BOOK VALUE |
At 31 October 2022 |
At 31 October 2021 |
Mona Tractor Company Limited (Registered number: 01567069) |
Notes to the Financial Statements - continued |
for the Year Ended 31 October 2022 |
10. | TANGIBLE FIXED ASSETS - continued |
Fixed assets, included in the above, which are held under hire purchase contracts are as follows: |
Motor |
vehicles |
£ |
COST |
At 1 November 2021 |
Additions |
Transfer to ownership | (70,479 | ) |
At 31 October 2022 |
DEPRECIATION |
At 1 November 2021 |
Charge for year |
Transfer to ownership | (41,306 | ) |
At 31 October 2022 |
NET BOOK VALUE |
At 31 October 2022 |
At 31 October 2021 |
11. | STOCKS |
31.10.22 | 31.10.21 |
£ | £ |
Parts held in stock |
Wholegood stock | 4,250,105 | 3,018,103 |
Included in the stock valuations are contra provisions for slow moving, obsolete and discounted stock. In the year the total provision included amounted to £168,237 (2021 £97,491). |
12. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
31.10.22 | 31.10.21 |
£ | £ |
Trade debtors |
Other debtors | 244,298 | 566,906 |
Prepayments |
Included within the trade debtor figure is a contra provisions for possible bad debts. In the year the total provision included amounted to £77,907 (2021 £86,424). |
Mona Tractor Company Limited (Registered number: 01567069) |
Notes to the Financial Statements - continued |
for the Year Ended 31 October 2022 |
13. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
31.10.22 | 31.10.21 |
£ | £ |
Bank loans and overdrafts (see note 15) |
Hire purchase contracts (see note 16) |
Trade creditors |
Tax |
VAT | 211,225 | 173,627 |
Other creditors |
Directors' current accounts | 791,000 | 873,000 |
Accrued expenses |
Deferred government grants |
14. | CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR |
31.10.22 | 31.10.21 |
£ | £ |
Bank loans (see note 15) |
Hire purchase contracts (see note 16) |
Deferred government grants |
15. | LOANS |
An analysis of the maturity of loans is given below: |
31.10.22 | 31.10.21 |
£ | £ |
Amounts falling due within one year or on demand: |
Bank overdrafts |
Bank loans |
Amounts falling due between one and two years: |
Bank loans - 1-2 years |
Amounts falling due between two and five years: |
Bank loans - 2-5 years |
Amounts falling due in more than five years: |
Repayable by instalments |
Bank loans more 5 yr by instal | 33,333 | - |
Mona Tractor Company Limited (Registered number: 01567069) |
Notes to the Financial Statements - continued |
for the Year Ended 31 October 2022 |
16. | LEASING AGREEMENTS |
Minimum lease payments fall due as follows: |
Hire purchase contracts |
31.10.22 | 31.10.21 |
£ | £ |
Net obligations repayable: |
Within one year |
Between one and five years |
Net obligations under finance leases and hire purchase contracts are secured against the assets to which the lease relates. |
The finance lease payments, including hire purchase contracts, represent rentals payable by the company for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 27 months (2021: 3 months). All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments. |
Non-cancellable | operating leases |
31.10.22 | 31.10.21 |
£ | £ |
Within one year |
Between one and five years |
In more than five years |
Being payable to Xafinity Pension Trustees Limited for the lease of property over a 10 year period commencing from February 2019. |
Mona Tractor Company Limited (Registered number: 01567069) |
Notes to the Financial Statements - continued |
for the Year Ended 31 October 2022 |
17. | SECURED DEBTS |
The following secured debts are included within creditors: |
31.10.22 | 31.10.21 |
£ | £ |
Bank overdraft |
Bank loans |
Hire purchase contracts | 11,102 | 6,123 |
The following charge is lodged as 'active' on the company's record at Companies House: |
Type: Debenture |
Date created: 25 January 2013 |
Entitled: HSBC Bank Plc |
Detail: Fixed and floating charge over the undertaking and all property and assets present and future, including goodwill, book debts, uncalled capital, buildings, fixtures, fixed plant & machinery. |
18. | PROVISIONS FOR LIABILITIES |
31.10.22 | 31.10.21 |
£ | £ |
Deferred tax | 36,603 | 25,233 |
Deferred |
tax |
£ |
Balance at 1 November 2021 |
Charge to Income Statement during year |
Prior year adjustment | 556 |
Balance at 31 October 2022 |
The deferred tax liability set out above relates to accelerated capital allowances that are expected to mature within the same period. |
19. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 31.10.22 | 31.10.21 |
value: | £ | £ |
Ordinary | £1 | 42,012 | 42,012 |
The ordinary shares have full voting rights, dividend and capital distribution (including winding up) rights. |
Mona Tractor Company Limited (Registered number: 01567069) |
Notes to the Financial Statements - continued |
for the Year Ended 31 October 2022 |
20. | RESERVES |
Retained |
earnings |
£ |
At 1 November 2021 |
Profit for the year |
At 31 October 2022 |
21. | RETIREMENT BENEFITS |
The company operates defined contributions pension schemes. The assets of the schemes are held separately from those of the company in independently administered funds. The pension cost charge represents contributions payable by the company to the funds and amounted to £49,049. (2021: £94,568). |
22. | RELATED PARTY DISCLOSURES |
Included in "creditors due within one year" are loans from the directors of £791,000 (2021: £873,000). Interest paid on these loans amounted to £0 (2021: £18,778) in the year. |
The controlling party is Mr J G Jones. |