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COMPANY REGISTRATION NUMBER: 07457498
Lorann Engineering Limited
Filleted Unaudited Financial Statements
31 March 2023
Lorann Engineering Limited
Statement of Financial Position
31 March 2023
2023
2022
Note
£
£
Fixed assets
Intangible assets
6
68,000
76,500
Tangible assets
7
92,609
78,437
---------
---------
160,609
154,937
Current assets
Stocks
90,127
15,118
Debtors
8
198,801
238,822
Cash at bank and in hand
327,844
431,126
---------
---------
616,772
685,066
Creditors: amounts falling due within one year
9
149,913
230,473
---------
---------
Net current assets
466,859
454,593
---------
---------
Total assets less current liabilities
627,468
609,530
Provisions
17,500
14,903
---------
---------
Net assets
609,968
594,627
---------
---------
Capital and reserves
Called up share capital
12
144
144
Capital redemption reserve
56
56
Profit and loss account
609,768
594,427
---------
---------
Shareholders funds
609,968
594,627
---------
---------
These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies' regime and in accordance with Section 1A of FRS 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'.
In accordance with section 444 of the Companies Act 2006, the statement of comprehensive income has not been delivered.
For the year ending 31 March 2023 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.
Directors' responsibilities:
- 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 ;
- The directors acknowledge their responsibilities for complying with the requirements of the Act with respect to accounting records and the preparation of financial statements .
Lorann Engineering Limited
Statement of Financial Position (continued)
31 March 2023
These financial statements were approved by the board of directors and authorised for issue on 7 November 2023 , and are signed on behalf of the board by:
Mr A J King
Mr C Rawlings
Director
Director
Company registration number: 07457498
Lorann Engineering Limited
Notes to the Financial Statements
Year ended 31 March 2023
1. General information
The company is a private company limited by shares, registered in England and Wales. The address of the registered office is Summit House, 10 Waterside Court, Newport, NP20 5NT.
2. Statement of compliance
These financial statements have been prepared in compliance with Section 1A of FRS 102, 'The Financial Reporting Standard applicable in the UK and the Republic of Ireland'.
3. Accounting policies
Basis of preparation
The financial statements have been prepared on the historical cost basis, as modified by the revaluation of certain financial assets and liabilities and investment properties measured at fair value through profit or loss.
The financial statements are prepared in sterling, which is the functional currency of the entity.
Revenue recognition
Turnover is measured at the fair value of the consideration received or receivable for goods supplied and services rendered, net of discounts and Value Added Tax. Revenue from the sale of goods is recognised when the significant risks and rewards of ownership have transferred to the buyer (usually on despatch of the goods); the amount of revenue can be measured reliably; it is probable that the associated economic benefits will flow to the entity; and the costs incurred or to be incurred in respect of the transactions can be measured reliably.
Income tax
The taxation expense represents the aggregate amount of current and deferred tax recognised in the reporting period. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, tax is recognised in other comprehensive income or directly in equity, respectively. Current tax is recognised on taxable profit for the current and past periods. Current tax is measured at the amounts of tax expected to pay or recover using the tax rates and laws that have been enacted or substantively enacted at the reporting date.
Deferred tax is recognised in respect of all timing differences at the reporting date. Unrelieved tax losses and other deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date that are expected to apply to the reversal of the timing difference.
Intangible assets
Intangible assets are initially recorded at cost, and are subsequently stated at cost less any accumulated amortisation and impairment losses. Any intangible assets carried at revalued amounts, are recorded at the fair value at the date of revaluation, as determined by reference to an active market, less any subsequent accumulated amortisation and subsequent accumulated impairment losses. Intangible assets acquired as part of a business combination are only recognised separately from goodwill when they arise from contractual or other legal rights, are separable, the expected future economic benefits are probable and the cost or value can be measured reliably.
Amortisation
Amortisation is calculated so as to write off the cost of an asset, less its estimated residual value, over the useful life of that asset as follows:
Intangible assets
-
5% straight line
If there is an indication that there has been a significant change in amortisation rate, useful life or residual value of an intangible asset, the amortisation is revised prospectively to reflect the new estimates.
Tangible assets
Tangible assets are initially recorded at cost, and subsequently stated at cost less any accumulated depreciation and impairment losses. Any tangible assets carried at revalued amounts are recorded at the fair value at the date of revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses. An increase in the carrying amount of an asset as a result of a revaluation, is recognised in other comprehensive income and accumulated in equity, except to the extent it reverses a revaluation decrease of the same asset previously recognised in profit or loss. A decrease in the carrying amount of an asset as a result of revaluation, is recognised in other comprehensive income to the extent of any previously recognised revaluation increase accumulated in equity in respect of that asset. Where a revaluation decrease exceeds the accumulated revaluation gains accumulated in equity in respect of that asset, the excess shall be recognised in profit or loss.
Depreciation
Depreciation is calculated so as to write off the cost or valuation of an asset, less its residual value, over the useful economic life of that asset as follows:
Plant and machinery
-
15% straight line
Fixtures and fittings
-
25% straight line
Motor vehicles
-
20% straight line
Impairment of fixed assets
A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date. For the purposes of impairment testing, when it is not possible to estimate the recoverable amount of an individual asset, an estimate is made of the recoverable amount of the cash-generating unit to which the asset belongs. The cash-generating unit is the smallest identifiable group of assets that includes the asset and generates cash inflows that largely independent of the cash inflows from other assets or groups of assets. For impairment testing of goodwill, the goodwill acquired in a business combination is, from the acquisition date, allocated to each of the cash-generating units that are expected to benefit from the synergies of the combination, irrespective of whether other assets or liabilities of the company are assigned to those units.
Stocks
Stocks are measured at the lower of cost and estimated selling price less costs to complete and sell. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing the stock to its present location and condition.
Provisions
Provisions are recognised when the entity has an obligation at the reporting date as a result of a past event, it is probable that the entity will be required to transfer economic benefits in settlement and the amount of the obligation can be estimated reliably. Provisions are recognised as a liability in the statement of financial position and the amount of the provision as an expense. Provisions are initially measured at the best estimate of the amount required to settle the obligation at the reporting date and subsequently reviewed at each reporting date and adjusted to reflect the current best estimate of the amount that would be required to settle the obligation. Any adjustments to the amounts previously recognised are recognised in profit or loss unless the provision was originally recognised as part of the cost of an asset. When a provision is measured at the present value of the amount expected to be required to settle the obligation, the unwinding of the discount is recognised as a finance cost in profit or loss in the period it arises.
Financial instruments
A financial asset or a financial liability is recognised only when the company becomes a party to the contractual provisions of the instrument. Basic financial instruments are initially recognised at the transaction price, unless the arrangement constitutes a financing transaction, where it is recognised at the present value of the future payments discounted at a market rate of interest for a similar debt instrument. Debt instruments are subsequently measured at amortised cost. Where investments in non-convertible preference shares and non-puttable ordinary shares or preference shares are publicly traded or their fair value can otherwise be measured reliably, the investment is subsequently measured at fair value with changes in fair value recognised in profit or loss. All other such investments are subsequently measured at cost less impairment. Other financial instruments, including derivatives, are initially recognised at fair value, unless payment for an asset is deferred beyond normal business terms or financed at a rate of interest that is not a market rate, in which case the asset is measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument. Other financial instruments are subsequently measured at fair value, with any changes recognised in profit or loss, with the exception of hedging instruments in a designated hedging relationship.
Financial assets that are measured at cost or amortised cost are reviewed for objective evidence of impairment at the end of each reporting date. If there is objective evidence of impairment, an impairment loss is recognised in profit or loss immediately. For all equity instruments regardless of significance, and other financial assets that are individually significant, these are assessed individually for impairment. Other financial assets are either assessed individually or grouped on the basis of similar credit risk characteristics. Any reversals of impairment are recognised in profit or loss immediately, to the extent that the reversal does not result in a carrying amount of the financial asset that exceeds what the carrying amount would have been had the impairment not previously been recognised.
Defined contribution plans
Contributions to defined contribution plans are recognised as an expense in the period in which the related service is provided. Prepaid contributions are recognised as an asset to the extent that the prepayment will lead to a reduction in future payments or a cash refund. When contributions are not expected to be settled wholly within 12 months of the end of the reporting date in which the employees render the related service, the liability is measured on a discounted present value basis. The unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.
4. Employee numbers
The average number of persons employed by the company during the year amounted to 9 (2022: 11 ).
5. Tax on profit
Major components of tax expense
2023
2022
£
£
Current tax:
UK current tax expense
22,976
63,792
Adjustments in respect of prior periods
199
--------
--------
Total current tax
23,175
63,792
--------
--------
Deferred tax:
Origination and reversal of timing differences
2,597
14,903
--------
--------
Tax on profit
25,772
78,695
--------
--------
Reconciliation of tax expense
The tax assessed on the profit on ordinary activities for the year is higher than (2022: higher than) the standard rate of corporation tax in the UK of 19 % (2022: 19 %).
2023
2022
£
£
Profit on ordinary activities before taxation
126,113
361,198
---------
---------
Profit on ordinary activities by rate of tax
23,961
68,627
Effect of expenses not deductible for tax purposes
( 278)
248
Effect of capital allowances and depreciation
( 708)
( 5,083)
Rounding on tax charge
1
Other tax adjustment to increase/(decrease) tax liability - desc in a/cs
199
---------
---------
Tax on profit
23,175
63,792
---------
---------
6. Intangible assets
Intangible asset user defined 1
£
Cost
At 1 April 2022 and 31 March 2023
170,000
---------
Amortisation
At 1 April 2022
93,500
Charge for the year
8,500
---------
At 31 March 2023
102,000
---------
Carrying amount
At 31 March 2023
68,000
---------
At 31 March 2022
76,500
---------
7. Tangible assets
Plant and machinery
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
Cost
At 1 April 2022
167,194
5,427
74,579
247,200
Additions
5,175
574
30,000
35,749
Disposals
( 15,529)
( 15,529)
---------
-------
--------
---------
At 31 March 2023
172,369
6,001
89,050
267,420
---------
-------
--------
---------
Depreciation
At 1 April 2022
130,454
5,315
32,994
168,763
Charge for the year
12,313
112
9,152
21,577
Disposals
( 15,529)
( 15,529)
---------
-------
--------
---------
At 31 March 2023
142,767
5,427
26,617
174,811
---------
-------
--------
---------
Carrying amount
At 31 March 2023
29,602
574
62,433
92,609
---------
-------
--------
---------
At 31 March 2022
36,740
112
41,585
78,437
---------
-------
--------
---------
8. Debtors
2023
2022
£
£
Trade debtors
153,335
231,587
Other debtors
45,466
7,235
---------
---------
198,801
238,822
---------
---------
9. Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
61,167
49,368
Corporation tax
22,976
68,621
Social security and other taxes
39,288
54,429
Other creditors
26,482
58,055
---------
---------
149,913
230,473
---------
---------
10. Deferred tax
The deferred tax included in the statement of financial position is as follows:
2023
2022
£
£
Included in provisions
17,500
14,903
--------
--------
The deferred tax account consists of the tax effect of timing differences in respect of:
2023
2022
£
£
Accelerated capital allowances
17,500
14,903
--------
--------
11. Financial instruments
The carrying amount for each category of financial instrument is as follows:
2023
2022
£
£
Financial assets measured at fair value through profit or loss
Financial assets measured at fair value through profit or loss
468,535
616,442
---------
---------
Financial liabilities measured at fair value through profit or loss
Financial liabilities measured at fair value through profit or loss
87,650
93,224
--------
--------
12. Called up share capital
Issued, called up and fully paid
2023
2022
No.
£
No.
£
Ordinary Class A shares of £ 1 each
44
44
44
44
Ordinary Class B shares of £ 1 each
100
100
100
100
----
----
----
----
144
144
144
144
----
----
----
----
13. Directors' advances, credits and guarantees
The balance of the directors loan account at the year end amounted to £18,157 in credit (2022: £49,679).