Company Registration No. SC620876
SUTHERLAND CONSTRUCTION LTD
UNAUDITED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 2023
PAGES FOR FILING WITH REGISTRAR
SUTHERLAND CONSTRUCTION LTD
CONTENTS OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 2023
Page
Balance sheet
1 - 2
Notes to the financial statements
3 - 9
SUTHERLAND CONSTRUCTION LTD
BALANCE SHEET
AS AT
28 FEBRUARY 2023
28 February 2023
- 1 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
3
82,890
110,323
Current assets
Stocks
12,300
9,280
Debtors
4
57,802
72,252
Cash at bank and in hand
3,843
13,139
73,945
94,671
Creditors: amounts falling due within one year
5
(185,986)
(124,955)
Net current liabilities
(112,041)
(30,284)
Total assets less current liabilities
(29,151)
80,039
Creditors: amounts falling due after more than one year
6
(29,553)
(48,046)
Provisions for liabilities
9
(6,190)
Net (liabilities)/assets
(58,704)
25,803
Capital and reserves
Alloted, called up and fully paid share capital
100
100
Profit and loss reserves
(58,804)
25,703
Total equity
(58,704)
25,803
The director of the company has elected not to include a copy of the profit and loss account within the financial statements.true
For the financial year ended 28 February 2023 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.
The director acknowledges his responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.
The member has not required the company to obtain an audit of its financial statements for the year in question in accordance with section 476.
These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.
SUTHERLAND CONSTRUCTION LTD
BALANCE SHEET (CONTINUED)
AS AT
28 FEBRUARY 2023
28 February 2023
- 2 -
The financial statements were approved and signed by the director and authorised for issue on 6 September 2023
Mr P M Sutherland
Director
Company Registration No. SC620876
SUTHERLAND CONSTRUCTION LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 2023
- 3 -
1
Accounting policies
Company information
Sutherland Construction Ltd is a private company limited by shares incorporated in Scotland. The registered office is West Point, Mid Keiss, Keiss, Wick, Caithness, KW1 4XF.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
At the balance sheet date, the company had net liabilities of £58,704 (2022 - £25,803 net assets) and net current liabilities totalling £112,041 (2022 - £30,284). However, the director has confirmed that he will ensure that adequate funds will be made available to meet third party liabilities as they fall due. On this basis, he considers it appropriate to prepare the financial statements on a going concern basis.
Accordingly, they continue to adopt the going concern basis in preparing the annual report and accounts.
1.2
Turnover
Turnover comprises the fair value of construction services provided and income from farm activities.
Revenue from construction services is recognised when the service has been provided and all obligations to the customers under the agreement have been fulfilled.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.
SUTHERLAND CONSTRUCTION LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
1
Accounting policies (Continued)
- 4 -
1.3
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Plant and equipment
20% reducing balance
Fixtures and fittings
3 years straight line
Motor vehicles
25% reducing balance
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.4
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.5
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.
Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
SUTHERLAND CONSTRUCTION LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
1
Accounting policies (Continued)
- 5 -
1.6
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.7
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
1.8
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
SUTHERLAND CONSTRUCTION LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
1
Accounting policies (Continued)
- 6 -
1.9
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and 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. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.10
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.11
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.12
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
SUTHERLAND CONSTRUCTION LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
1
Accounting policies (Continued)
- 7 -
1.13
Government grants
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
Government grants relating to turnover are recognised as income over the periods when the related costs are incurred. Grants relating to an asset are recognised in income systematically over the asset's expected useful life. If part of such a grant is deferred it is recognised as deferred income rather than being deducted from the asset's carrying amount.
2
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Total
5
4
3
Tangible fixed assets
Plant and equipment
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
Cost
At 1 March 2022
42,110
5,525
109,160
156,795
Additions
15,857
32,580
48,437
Disposals
(66,950)
(66,950)
At 28 February 2023
57,967
5,525
74,790
138,282
Depreciation and impairment
At 1 March 2022
15,475
3,707
27,290
46,472
Depreciation charged in the year
8,499
1,100
16,059
25,658
Eliminated in respect of disposals
(16,738)
(16,738)
At 28 February 2023
23,974
4,807
26,611
55,392
Carrying amount
At 28 February 2023
33,993
718
48,179
82,890
At 28 February 2022
26,635
1,818
81,870
110,323
SUTHERLAND CONSTRUCTION LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
- 8 -
4
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
45,294
23,521
Other debtors
12,508
48,731
57,802
72,252
5
Creditors: amounts falling due within one year
2023
2022
£
£
Bank loans
8
6,569
7,030
Obligations under finance leases
7
10,751
14,067
Trade creditors
6,796
6,170
Taxation and social security
19,379
4,664
Other creditors
142,491
93,024
185,986
124,955
6
Creditors: amounts falling due after more than one year
2023
2022
£
£
Bank loans and overdrafts
17,518
23,626
Other creditors
12,035
24,420
29,553
48,046
7
Finance lease obligations
2023
2022
Future minimum lease payments due under finance leases:
£
£
Within one year
10,751
14,067
In two to five years
12,035
24,420
22,786
38,487
Hire purchase and finance lease creditors are secured over the assets they relate to.
SUTHERLAND CONSTRUCTION LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2023
- 9 -
8
Loans and overdrafts
2023
2022
£
£
Bank loans
24,087
30,656
Payable within one year
6,569
7,030
Payable after one year
17,518
23,626
The company received a Coronavirus Bounce Back loan of £50,000. This loan is secured by way of government guarantee, attracts interest at a rate of 2.5% per annum and is repayable over six years, with the first year repayment free.
9
Provisions for liabilities
2023
2022
£
£
Deferred tax liabilities
10
6,190
10
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2023
2022
Balances:
£
£
Accelerated capital allowances
-
6,190
2023
Movements in the year:
£
Liability at 1 March 2022
6,190
Credit to profit or loss
(6,190)
Liability at 28 February 2023
-
11
Related party transactions
Included in other debtors is a loan of £5,000 to Snax2goe Ltd, a company in which the director, Mr P M Sutherland, is a director. This loan is interest free, unsecured and has no fixed terms of repayment.
Included in other creditors is a loan of £136,725 (2022 - £90,824) from the director, Mr P M Sutherland. This loan is unsecured, interest free and has no fixed terms of repayment
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