Company registration number SC331614 (Scotland)
M & F (SCOTLAND) LIMITED CONSOLIDATION
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023
M & F (SCOTLAND) LIMITED CONSOLIDATION
COMPANY INFORMATION
Directors
Mr R T Givan
Mrs R Lees
Secretary
Mr R T Givan
Company number
SC331614
Registered office
Babs Court
4 Shorthope Street
Musselburgh
East Lothian
EH21 7DB
Auditor
Thomson Cooper
3 Castle Court
Carnegie Campus
Dunfermline
Fife
KY11 8PB
M & F (SCOTLAND) LIMITED CONSOLIDATION
CONTENTS
Page
Strategic report
1 - 3
Directors' report
4 - 5
Independent auditor's report
6 - 8
Profit and loss account
9
Group statement of comprehensive income
10
Group balance sheet
11
Company balance sheet
12 - 13
Group statement of changes in equity
14
Company statement of changes in equity
15
Group statement of cash flows
16
Notes to the financial statements
17 - 37
M & F (SCOTLAND) LIMITED CONSOLIDATION
STRATEGIC REPORT
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 1 -

The directors present the strategic report for the year ended 30 September 2023.

Fair review of the business

The principal activity of the group during the year continued to be that of a funeral directors, funeral plan provider and property investment.

 

This year has proved to be another strong year of trading as shown in the financial results reported below.

 

M&F Funeral Services Ltd trading performance reflects the number of funerals carried out in the year to 30 September 2023. The company opened an additional branch in Musselburgh High Street in December 2022 which contributed towards an increase in the sale of Funeral Plans.

 

The company upgraded some of its commercial rental properties during the year. It also secured a 95% occupancy rate.

 

Outlook

 

The group will continue to invest in its business in 2024.

 

The financial year 2024 may see an increase in expenditure as a result of:

 

M & F (SCOTLAND) LIMITED CONSOLIDATION
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 2 -
Principal risks and uncertainties

The directors are ultimately responsible for the system of internal control, which covers all aspects of the business, and for reviewing its effectiveness. However, any such system is designed to manage, rather than eliminate, the risk of failure to achieve the company's objectives. Therefore any system is only able to provide reasonable, and not absolute assurance against material misstatement or loss. The directors regularly review the risks to which the company is exposed, as well as the operation and effectiveness of the system of internal controls. This is an ongoing process, involving the identification, evaluation and management of the significant risks faced by the group.

 

Risks are assessed on a regular basis across all areas but, in particular, health and safety, information flow, asset protection and regulatory requirements.

 

Risk and impact

Mitigations

Market Risk

Competition

The company faces competition from other firms operating within our target locations. Failure to react to market pricing could result in business being lost to our competitors. Failure to meet or exceed our customers’ expectations could result in a loss of customers and income.

 

  • The company monitors demand and pricing on a regular basis and reacts as necessary.

 

  • The company is continually working to improve customers’ experience.

 

  • The company monitors funeral customers’ feedback and reacts as required.

 

Operational Risks

Health & Safety

A major health & safety incident at one or more of our properties could result in the closure of operations, suppressed income, reputational damage and extra costs.

 

 

  • Completion of health & safety training is monitored by the Board.

Regulatory Compliance

The company is exposed to FCA compliance for the provision of Funeral Plans in addition to compliance in other areas such as health & safety, taxation, data protection. There is a risk of fines, operational difficulties, rectification costs and reputational damage

 

 

  • The company performs regular compliance reviews as part of risk management and actions are monitored at board level.

Staffing

The company would suffer operational difficulties and reputational damage if it were unable to recruit and retain the best staff to run the business

 

  • The company monitors market pay rates to ensure it is competitive in the recruitment market.

 

  • The company invests in training and benefits to maintain a good level of staff retention.

 

Financial Risks

Liquidity

The business would not be able to operate if it ran out of cash and would risk creditor actions

 

  • The company regularly monitors its cashflow forecast.

 

 

M & F (SCOTLAND) LIMITED CONSOLIDATION
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 3 -
Key performance indicators

The key financial indicators used by the directors are detailed below:

 

 

2023

2022

2021

 

£’000

£’000

£’000

Turnover

1,602

1,662

1,532

Gross Profit

1,174

1,157

1,166

Operating Profit/(Loss)

358

308

316

On behalf of the board

Mr R T Givan
Director
5 March 2024
M & F (SCOTLAND) LIMITED CONSOLIDATION
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 4 -

The directors present their annual report and financial statements for the year ended 30 September 2023.

Principal activities

The principal activity of the group continued to be that of funeral directors and property investment.

Results and dividends

The results for the year are set out on page 9.

No ordinary dividends were paid. The directors do not recommend payment of a further dividend.

Directors

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

Mr R T Givan
Mrs R Lees
Statement of directors' responsibilities

The directors are responsible for preparing the Annual 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). 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 group and company, and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

 

 

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the auditor of the company is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the auditor of the company is aware of that information.

M & F (SCOTLAND) LIMITED CONSOLIDATION
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 5 -
On behalf of the board
Mr R T Givan
Director
5 March 2024
M & F (SCOTLAND) LIMITED CONSOLIDATION
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF M & F (SCOTLAND) LIMITED CONSOLIDATION
- 6 -
Opinion

We have audited the financial statements of M & F (Scotland) Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 30 September 2023 which comprise the group profit and loss account, the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the financial statements, including 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:

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 Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent 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 group's and parent 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 other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. 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. 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 course of 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 our audit:

M & F (SCOTLAND) LIMITED CONSOLIDATION
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF M & F (SCOTLAND) LIMITED CONSOLIDATION
- 7 -
Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and the parent company and their 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 in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, 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 is 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 parent 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 parent company or to cease operations, or have no realistic alternative but to do so.

Auditor's 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.

The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

Extent to which the audit was considered capable of detecting irregularities, including fraud

We considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in the following areas: existence and timing of recognition of income, posting of unusual journals along with complex transactions and non-compliance with laws and regulations including those governed by the Financial Conduct Authority (FCA). We discussed these risks with management, designed audit procedures to test the timing and existence of revenue, tested a sample of journals to confirm they were appropriate and enquired of officers and directors and reviewed correspondence with the FCA of any reference to breaches of laws and regulations.

We also reviewed the laws and regulations in areas that directly affect the financial statements including applicable company law and considered the extent of compliance with those laws and regulations as part of our procedures on the related financial statement items.

With the exception of any known or possible non-compliance with relevant and significant laws and regulations, and as required by the auditing standards, our work in respect of these was limited to enquiry of the officers and management of the company.

We communicated identified laws and regulations and potential fraud risks throughout our team and remained alert to any indications of non-compliance or fraud throughout the audit. However the primary responsibility for the prevention and detection of fraud rests with the director.

M & F (SCOTLAND) LIMITED CONSOLIDATION
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF M & F (SCOTLAND) LIMITED CONSOLIDATION
- 8 -

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.

These inherent limitations are particularly significant in the case of misstatement resulting from fraud as this may involve sophisticated schemes designed to avoid detection, including deliberate failure to record transactions, collusion or the provision of intentional misrepresentations.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

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 auditor's 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.

Sharon Collins (Senior Statutory Auditor)
For and on behalf of Thomson Cooper
Dunfermline
5 March 2024
M & F (SCOTLAND) LIMITED CONSOLIDATION
GROUP PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 9 -
2023
2022
Notes
£
£
Turnover
3
1,602,437
1,662,193
Cost of sales
(428,639)
(505,254)
Gross profit
1,173,798
1,156,939
Administrative expenses
(815,517)
(848,859)
Operating profit
4
358,281
308,080
Interest receivable and similar income
8
2,254
2,254
Interest payable and similar expenses
9
(64,775)
(133,253)
Amounts written off investments
10
-
50,000
Fair value gains and losses on investment properties
13
565,000
-
0
Profit before taxation
860,760
227,081
Tax on profit
11
(47,608)
(40,991)
Profit for the financial year
26
813,152
186,090
Profit for the financial year is all attributable to the owners of the parent company.
M & F (SCOTLAND) LIMITED CONSOLIDATION
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 10 -
2023
2022
£
£
Profit for the year
813,152
186,090
Other comprehensive income
Actuarial (loss)/gain on defined benefit pension schemes
(25,000)
2,043,000
Tax relating to other comprehensive income
-
0
(372,400)
Other comprehensive income for the year
(25,000)
1,670,600
Total comprehensive income for the year
788,152
1,856,690
Total comprehensive income for the year is all attributable to the owners of the parent company.
M & F (SCOTLAND) LIMITED CONSOLIDATION
GROUP BALANCE SHEET
AS AT
30 SEPTEMBER 2023
30 September 2023
- 11 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
12
769,011
410,337
Investment properties
13
7,662,591
7,272,591
Investments
14
57,175
57,175
8,488,777
7,740,103
Current assets
Stocks
16
27,073
27,722
Debtors
17
58,047
67,188
Cash at bank and in hand
224,726
463,331
309,846
558,241
Creditors: amounts falling due within one year
18
(667,126)
(843,964)
Net current liabilities
(357,280)
(285,723)
Total assets less current liabilities
8,131,497
7,454,380
Creditors: amounts falling due after more than one year
19
(408,296)
(561,839)
Provisions for liabilities
Deferred tax liability
22
44,512
1,704
(44,512)
(1,704)
Net assets
7,678,689
6,890,837
Capital and reserves
Called up share capital
25
19,480
19,486
Capital redemption reserve
26
1,011
1,005
Profit and loss reserves
26
7,658,198
6,870,346
Total equity
7,678,689
6,890,837
The financial statements were approved by the board of directors and authorised for issue on 5 March 2024 and are signed on its behalf by:
05 March 2024
Mr R T Givan
Director
Company registration number SC331614 (Scotland)
M & F (SCOTLAND) LIMITED CONSOLIDATION
COMPANY BALANCE SHEET
AS AT 30 SEPTEMBER 2023
30 September 2023
- 12 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
12
271,829
269,345
Investment properties
13
7,662,591
7,272,591
Investments
14
57,275
57,275
7,991,695
7,599,211
Current assets
Debtors
17
39,355
247,327
Cash at bank and in hand
118,212
113,222
157,567
360,549
Creditors: amounts falling due within one year
18
(410,641)
(614,512)
Net current liabilities
(253,074)
(253,963)
Total assets less current liabilities
7,738,621
7,345,248
Creditors: amounts falling due after more than one year
19
(304,533)
(561,839)
Provisions for liabilities
Deferred tax liability
22
-
0
57
-
(57)
Net assets
7,434,088
6,783,352
Capital and reserves
Called up share capital
25
19,480
19,486
Capital redemption reserve
26
1,011
1,005
Profit and loss reserves
26
7,413,597
6,762,861
Total equity
7,434,088
6,783,352

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £676,036 (2022 - £236,562 profit).

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

M & F (SCOTLAND) LIMITED CONSOLIDATION
COMPANY BALANCE SHEET (CONTINUED)
AS AT 30 SEPTEMBER 2023
30 September 2023
- 13 -
The financial statements were approved by the board of directors and authorised for issue on 5 March 2024 and are signed on its behalf by:
05 March 2024
Mr R T Givan
Director
Company registration number SC331614 (Scotland)
M & F (SCOTLAND) LIMITED CONSOLIDATION
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 14 -
Share capital
Capital redemption reserve
Pension reserve
Profit and loss reserves
Total
Notes
£
£
£
£
£
Balance at 1 October 2021
19,486
1,005
(1,960,000)
6,973,656
5,034,147
Year ended 30 September 2022:
Profit for the year
-
-
-
186,090
186,090
Other comprehensive income:
Actuarial gains on defined benefit plans
-
-
-
2,043,000
2,043,000
Tax relating to other comprehensive income
-
-
-
(372,400)
(372,400)
Total comprehensive income
-
-
-
1,856,690
1,856,690
Transfers
-
-
-
(1,960,000)
(1,960,000)
Other movements
-
-
1,960,000
-
1,960,000
Balance at 30 September 2022
19,486
1,005
-
6,870,346
6,890,837
Year ended 30 September 2023:
Profit for the year
-
-
-
813,152
813,152
Other comprehensive income:
Actuarial gains on defined benefit plans
-
-
-
(25,000)
(25,000)
Total comprehensive income
-
-
-
788,152
788,152
Own shares acquired
-
-
-
(300)
(300)
Redemption of shares
25
(6)
6
-
-
-
0
Balance at 30 September 2023
19,480
1,011
-
7,658,198
7,678,689
M & F (SCOTLAND) LIMITED CONSOLIDATION
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 15 -
Share capital
Capital redemption reserve
Pension reserve
Profit and loss reserves
Total
Notes
£
£
£
£
£
Balance at 1 October 2021
19,486
1,005
(1,960,000)
6,815,699
4,876,190
Year ended 30 September 2022:
Profit for the year
-
-
-
236,562
236,562
Other comprehensive income:
Actuarial gains on defined benefit plans
-
-
-
2,043,000
2,043,000
Tax relating to other comprehensive income
-
-
-
(372,400)
(372,400)
Total comprehensive income
-
-
-
1,907,162
1,907,162
Transfers
-
-
-
(1,960,000)
(1,960,000)
Other movements
-
-
1,960,000
-
1,960,000
Balance at 30 September 2022
19,486
1,005
-
6,762,861
6,783,352
Year ended 30 September 2023:
Profit for the year
-
-
-
676,036
676,036
Other comprehensive income:
Actuarial gains on defined benefit plans
-
-
-
(25,000)
(25,000)
Total comprehensive income
-
-
-
651,036
651,036
Own shares acquired
-
-
-
(300)
(300)
Redemption of shares
25
(6)
6
-
-
-
0
Balance at 30 September 2023
19,480
1,011
-
7,413,597
7,434,088
M & F (SCOTLAND) LIMITED CONSOLIDATION
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 16 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
28
195,674
482,192
Interest paid
(64,775)
(133,253)
Income taxes paid
(57,971)
(55,738)
Net cash inflow from operating activities
72,928
293,201
Investing activities
Purchase of tangible fixed assets
(558,695)
(49,358)
Proceeds from disposal of tangible fixed assets
147,145
8,000
Purchase of investment property
-
(59,800)
Proceeds from disposal of investment property
290,000
100,000
Proceeds from disposal of investments
-
50,000
Interest received
2,254
2,254
Net cash (used in)/generated from investing activities
(119,296)
51,096
Financing activities
Purchase of treasury shares
(300)
-
0
Repayment of bank loans
(404,620)
(155,166)
Payment of finance leases obligations
218,995
(10,070)
Net cash used in financing activities
(185,925)
(165,236)
Net (decrease)/increase in cash and cash equivalents
(232,293)
179,061
Cash and cash equivalents at beginning of year
455,661
276,600
Cash and cash equivalents at end of year
223,368
455,661
Relating to:
Cash at bank and in hand
224,726
463,331
Bank overdrafts included in creditors payable within one year
(1,358)
(7,670)
M & F (SCOTLAND) LIMITED CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 17 -
1
Accounting policies
Company information

M & F (Scotland) Limited (“the company”) is a private limited company domiciled and incorporated in Scotland. The registered office is Babs Court, 4 Shorthope Street, Musselburgh, East Lothian, EH21 7DB.

 

The group consists of M & F (Scotland) Limited and all of its subsidiaries.

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.

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 to include investment properties and certain financial instruments at fair value. Endif} The principal accounting policies adopted are set out below.

1.2
Business combinations

In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.

 

Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.

1.3
Basis of consolidation

The consolidated group financial statements consist of the financial statements of the parent company M & F (Scotland) Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.

 

All financial statements are made up to 30 September 2023. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

 

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.

M & F (SCOTLAND) LIMITED CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
1
Accounting policies
(Continued)
- 18 -

Entities in which the group holds an interest and which are jointly controlled by the group and one or more other venturers under a contractual arrangement are treated as joint ventures. Entities other than subsidiary undertakings or joint ventures, in which the group has a participating interest and over whose operating and financial policies the group exercises a significant influence, are treated as associates.

Investments in joint ventures and associates are carried in the group balance sheet at cost plus post-acquisition changes in the group’s share of the net assets of the entity, less any impairment in value. The carrying values of investments in joint ventures and associates include acquired goodwill.

 

If the group’s share of losses in a joint venture or associate equals or exceeds its investment in the joint venture or associate, the group does not recognise further losses unless it has incurred obligations to do so or has made payments on behalf of the joint venture or associate.

 

Unrealised gains arising from transactions with joint ventures and associates are eliminated to the extent of the group’s interest in the entity.

1.4
Going concern

At the time of approving the financial statements the directors consider that the group has adequate resources to continue in operational existence for a period of not less than twelve months. The directors have reviewed the cashflow requirements and are satisfied that the group has sufficient cash reserves and as such continue to adopt the going concern basis of accounting in preparing the financial statements.

1.5
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

 

When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.

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.

1.6
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:

Heritable property
2 - 2.5% straight line
Fixtures and fittings
10 - 25% straight line
Motor vehicles
10 - 20% straight line

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

M & F (SCOTLAND) LIMITED CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
1
Accounting policies
(Continued)
- 19 -
1.7
Investment property

Investment property, which is property held to earn rentals and/or for capital appreciation, is initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Subsequently it is measured at fair value at the reporting end date. Changes in fair value are recognised in profit or loss.

1.8
Fixed asset investments

Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.

 

In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.

 

Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the group’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method. Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.

 

Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.

 

In the parent company financial statements, investments in associates are accounted for at cost less impairment.

Entities in which the group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

1.9
Impairment of fixed assets

At each reporting period end date, the group 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.

 

The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.

M & F (SCOTLAND) LIMITED CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
1
Accounting policies
(Continued)
- 20 -

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.

1.10
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.

1.11
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.

1.12
Financial instruments

The group 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 group's balance sheet when the group becomes party to the contractual provisions of the instrument.

 

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.

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.

M & F (SCOTLAND) LIMITED CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
1
Accounting policies
(Continued)
- 21 -
Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. 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 a 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.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

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 group 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.

M & F (SCOTLAND) LIMITED CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
1
Accounting policies
(Continued)
- 22 -
Other financial liabilities

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

 

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Derecognition of financial liabilities

Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.

1.13
Equity instruments

Equity instruments issued by the group 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 group.

1.14
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 group’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 if, and only if, there is 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.

M & F (SCOTLAND) LIMITED CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
1
Accounting policies
(Continued)
- 23 -
1.15
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.

1.16
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.17
Leases

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

 

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

2
Judgements and key sources of estimation uncertainty

In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

    

The items in the financial statements where these judgements and estimates have been made include:

 

Defined benefit pension and other post-employment benefits.

The present value of the defined pension and other post-employment benefit obligations depends on a number of factors that are determined on an actuarial basis using a number of assumptions. The assumptions used in determining the net cost (income) for pension and other post-employment benefits include the discount rate. Any changes in these assumptions will have an effect on the carrying amount of pension and other post-employment benefits.

    

After taking appropriate professional advice, management determines the appropriate discount rate at the end of each reporting period. This is the interest rate that should be used to determine the present value of estimated future cash outflows expected to be required to settle the pension obligations. In determining the appropriate discount rate, consideration is given to the interest rates of high- quality corporate bonds that are denominated in the currency which the benefits are to be paid and that have terms to maturity approximating the terms of the related pension liability.

 

M & F (SCOTLAND) LIMITED CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 24 -
3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
1,602,437
1,662,193
2023
2022
£
£
Other revenue
Interest income
2,254
2,254
4
Operating profit
2023
2022
£
£
Operating profit for the year is stated after charging/(crediting):
Depreciation of owned tangible fixed assets
107,547
2,902
Depreciation of tangible fixed assets held under finance leases
35,036
51,050
Profit on disposal of tangible fixed assets
(89,707)
(2,574)
Profit on disposal of investment property
(115,000)
-
0
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
20,065
8,730
Audit of the financial statements of the company's subsidiaries
9,309
11,960
29,374
20,690
6
Employees

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

Group
Company
2023
2022
2023
2022
Number
Number
Number
Number
17
15
3
3
M & F (SCOTLAND) LIMITED CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
6
Employees
(Continued)
- 25 -

Their aggregate remuneration comprised:

Group
Company
2023
2022
2023
2022
£
£
£
£
Wages and salaries
391,431
408,905
178,741
182,269
Social security costs
40,838
46,502
21,164
25,360
Pension costs
10,354
(7,245)
6,308
(10,217)
442,623
448,162
206,213
197,412
7
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
109,882
154,389
8
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
2,254
2,254
2023
2022
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
2,254
2,254
9
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
51,143
26,068
Other interest on financial liabilities
8,818
105,505
59,961
131,573
Other finance costs:
Interest on finance leases and hire purchase contracts
4,814
1,680
Total finance costs
64,775
133,253
M & F (SCOTLAND) LIMITED CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 26 -
10
Amounts written off investments
2023
2022
£
£
Gain on disposal of fixed asset investments
-
50,000
11
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
4,800
57,998
Deferred tax
Origination and reversal of timing differences
42,808
(17,007)
Total tax charge
47,608
40,991

The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:

2023
2022
£
£
Profit before taxation
860,760
227,081
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2022: 19.00%)
163,544
43,145
Tax effect of expenses that are not deductible in determining taxable profit
(143,515)
(21,790)
Change in unrecognised deferred tax assets
-
0
(16,967)
Adjustments in respect of prior years
(77)
-
0
Group relief
(11,271)
-
0
Permanent capital allowances in excess of depreciation
(13,124)
(1,357)
Deferred tax
42,865
(40)
Dividend income
19,000
38,000
(9,814)
-
0
Taxation charge
47,608
40,991

In addition to the amount charged to the profit and loss account, the following amounts relating to tax have been recognised directly in other comprehensive income:

2023
2022
£
£
Current tax arising on:
Actuarial differences recognised as other comprehensive income
-
372,400
M & F (SCOTLAND) LIMITED CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 27 -
12
Tangible fixed assets
Group
Heritable property
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
Cost
At 1 October 2022
129,117
219,661
435,867
784,645
Additions
-
0
6,045
552,650
558,695
Disposals
-
0
-
0
(158,296)
(158,296)
At 30 September 2023
129,117
225,706
830,221
1,185,044
Depreciation and impairment
At 1 October 2022
29,747
184,135
160,426
374,308
Depreciation charged in the year
404
23,189
118,990
142,583
Eliminated in respect of disposals
-
0
-
0
(100,858)
(100,858)
At 30 September 2023
30,151
207,324
178,558
416,033
Carrying amount
At 30 September 2023
98,966
18,382
651,663
769,011
At 30 September 2022
99,370
35,526
275,441
410,337
Company
Heritable property
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
Cost
At 1 October 2022
129,117
214,962
249,298
593,377
Additions
-
0
-
0
134,405
134,405
Disposals
-
0
-
0
(123,145)
(123,145)
At 30 September 2023
129,117
214,962
260,558
604,637
Depreciation and impairment
At 1 October 2022
29,747
183,665
110,620
324,032
Depreciation charged in the year
404
21,251
76,823
98,478
Eliminated in respect of disposals
-
0
-
0
(89,702)
(89,702)
At 30 September 2023
30,151
204,916
97,741
332,808
Carrying amount
At 30 September 2023
98,966
10,046
162,817
271,829
At 30 September 2022
99,370
31,297
138,678
269,345
M & F (SCOTLAND) LIMITED CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
12
Tangible fixed assets
(Continued)
- 28 -

The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.

Group
Company
2023
2022
2023
2022
£
£
£
£
Motor vehicles
729,020
161,066
162,818
80,533
13
Investment property
Group
Company
2023
2023
£
£
Fair value
At 1 October 2022
7,272,591
7,272,591
Disposals
(175,000)
(175,000)
Net gains or losses through fair value adjustments
565,000
565,000
At 30 September 2023
7,662,591
7,662,591

The fair value of the investment properties has been arrived at on the basis of rotational valuations carried out in the period between 2019-2023 by J & E Shepherd, Shandwick Property Chartered Surveyors and Peter Thomson Chartered Surveyors, who are not connected with the company. The valuations were made on an open market value basis by reference to market evidence of transaction prices for similar properties.

 

Four of the properties which are leased to the subsidiary company have been valued at directors valuation based upon rental yields.

 

 

14
Fixed asset investments
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Investments in subsidiaries
15
55
55
155
155
Unlisted investments
57,120
57,120
57,120
57,120
57,175
57,175
57,275
57,275

M & F (Scotland) Limited holds 100% of the issued share capital of M & F Funeral Services Limited, incorporated in Scotland.

 

The unlisted investment represent a corporate investor share account with the Co Operative Group. The rights associated with this holding allow the company to receive a payment of interest on their capital twice a year. This does not represent an equity holding.

 

M & F (SCOTLAND) LIMITED CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
14
Fixed asset investments
(Continued)
- 29 -
Movements in fixed asset investments
Group
Shares in subsidiaries
Other investments
Total
£
£
£
Cost or valuation
At 1 October 2022 and 30 September 2023
55
57,120
57,175
Carrying amount
At 30 September 2023
55
57,120
57,175
At 30 September 2022
55
57,120
57,175
Movements in fixed asset investments
Company
Shares in subsidiaries
Other investments
Total
£
£
£
Cost or valuation
At 1 October 2022 and 30 September 2023
155
57,120
57,275
Carrying amount
At 30 September 2023
155
57,120
57,275
At 30 September 2022
155
57,120
57,275
15
Subsidiaries

Details of the company's subsidiaries at 30 September 2023 are as follows:

Name of undertaking
Registered office
Class of
% Held
shares held
Direct
M & F Funeral Services Limited
Babs Court, 4 Shorthope Street, Museelburgh, East Lothian, EH21 7DB
Ordinary Shares
100.00
16
Stocks
Group
Company
2023
2022
2023
2022
£
£
£
£
Finished goods and goods for resale
27,073
27,722
-
0
-
0
M & F (SCOTLAND) LIMITED CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 30 -
17
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade debtors
14,010
16,971
-
0
-
0
Amounts owed by group undertakings
-
-
45
218,878
Other debtors
30,188
20,611
29,893
20,511
Prepayments and accrued income
13,849
29,606
9,417
7,938
58,047
67,188
39,355
247,327
18
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans and overdrafts
20
93,331
199,225
93,331
192,913
Obligations under finance leases
21
108,854
41,354
27,700
41,354
Trade creditors
79,520
73,188
8,416
20,469
Corporation tax payable
4,827
57,998
-
0
20,598
Other taxation and social security
2,290
73,668
-
1,240
Deferred income
23
7,954
-
0
7,954
-
0
Other creditors
292,350
294,231
257,315
263,263
Accruals and deferred income
78,000
104,300
15,925
74,675
667,126
843,964
410,641
614,512

The Royal Bank of Scotland Plc holds legal charges over all property and undertakings of the company. The Royal Bank of Scotland Plc also holds various standard securities, floating charges and negative pledges over various properties owned by the company.

19
Creditors: amounts falling due after more than one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans and overdrafts
20
243,681
548,719
243,681
548,719
Obligations under finance leases
21
164,615
13,120
60,852
13,120
408,296
561,839
304,533
561,839
M & F (SCOTLAND) LIMITED CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 31 -
20
Loans and overdrafts
Group
Company
2023
2022
2023
2022
£
£
£
£
Bank loans
335,654
740,274
335,654
740,274
Bank overdrafts
1,358
7,670
1,358
1,358
337,012
747,944
337,012
741,632
Payable within one year
93,331
199,225
93,331
192,913
Payable after one year
243,681
548,719
243,681
548,719

The following securities have been granted by M & F Funeral Services Limited: The Royal Bank of Scotland Plc hold a bond and floating charge dated 14th July 2020 over all property and undertakings of the company.

 

The following securities have been granted by M & F (Scotland) Limited to the Royal Bank of Scotland:

 

21
Finance lease obligations
Group
Company
2023
2022
2023
2022
£
£
£
£
Future minimum lease payments due under finance leases:
Within one year
108,854
41,354
27,700
41,354
In two to five years
164,615
13,120
60,852
13,120
273,469
54,474
88,552
54,474

Finance lease payments represent rentals payable by the company or group 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 4 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

M & F (SCOTLAND) LIMITED CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 32 -
22
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:

Liabilities
Liabilities
2023
2022
Group
£
£
Accelerated capital allowances
44,512
1,704
Liabilities
Liabilities
2023
2022
Company
£
£
Accelerated capital allowances
-
57
Group
Company
2023
2023
Movements in the year:
£
£
Liability at 1 October 2022
1,704
57
Charge/(credit) to profit or loss
42,808
(57)
Liability at 30 September 2023
44,512
-
23
Deferred income
Group
Company
2023
2022
2023
2022
£
£
£
£
Other deferred income
7,954
-
7,954
-
24
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
10,354
(7,245)

A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

M & F (SCOTLAND) LIMITED CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
24
Retirement benefit schemes
(Continued)
- 33 -
Defined benefit scheme - group and company

The company operates a defined benefit scheme for qualifying employees.

 

The most recent actuarial valuations of plan assets and the present value of the defined benefit obligation were carried out at 30 September 2022 by Broadstone Corporate Benefits Limited, Fellow of the Institute of Actuaries. The present value of the defined benefit obligation, the related current service cost and past service cost were measured using the projected unit credit method.

2023
2022
Key assumptions
%
%
Discount rate
5.4
5.1
Expected rate of increase of pensions in payment
4.4
4.7
Expected rate of salary increases
3.4
3.7
Rate of inflation-linked revaluation of pensions in deferment
3.4
3.7
Rate of inflation linked pensions in payment increases
3.0
3.2
Cash commutation
100
100
Mortality assumptions

Post retirement mortality at 30 September 2023 was S3PA tables, CMI_2022 with a long term rate of improvement of future rates of 1%.

 

Post retirement mortality at 30 September 2022 was S3PA tables, CMI_2021 with a long term rate of improvement of future rates of 1%.

The amounts included in the balance sheet arising from the company's obligations in respect of defined benefit plans are as follows:

Group and company
2023
2022
£
£
Present value of defined benefit obligations
3,748,000
4,275,000
Fair value of plan assets
(3,748,000)
(4,275,000)
Deficit in scheme
-
-
Total liability recognised
-
-
Group and company
2023
2022

Amounts recognised in the profit and loss account

£
£
Current service cost
16,000
63,000
Net interest on net defined benefit liability/(asset)
(20,000)
39,000
Total costs/(income)
(4,000)
102,000
M & F (SCOTLAND) LIMITED CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
24
Retirement benefit schemes
(Continued)
- 34 -
Group and company
2023
2022

Amounts taken to other comprehensive income

£
£
Actual return on scheme assets
(416,000)
380,000
Less: calculated interest element
233,000
103,000
Return on scheme assets excluding interest income
(183,000)
483,000
Actuarial changes related to obligations
(542,000)
(2,910,000)
Total costs/(income)
(725,000)
(2,427,000)
Group and company
2023

Movements in the present value of defined benefit obligations

£
Liabilities at 1 October 2022
4,275,000
Current service cost
16,000
Benefits paid
(223,000)
Contributions from scheme members
9,000
Actuarial gains and losses
(542,000)
Interest cost
213,000
At 30 September 2023
3,748,000
Group and company
2023

The defined benefit obligations arise from plans funded as follows:

£
Wholly unfunded obligations
-
Wholly or partly funded obligations
3,748,000
3,748,000
Group and company
2023

Movements in the fair value of plan assets

£
Fair value of assets at 1 October 2022
4,275,000
Interest income
233,000
Return on plan assets (excluding amounts included in net interest)
183,000
Benefits paid
(223,000)
Contributions by the employer
21,000
Contributions by scheme members
9,000
Other
(750,000)
At 30 September 2023
3,748,000

The actual return on plan assets was £233,000 (2022 - £103,000).

M & F (SCOTLAND) LIMITED CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
24
Retirement benefit schemes
(Continued)
- 35 -
Group and company
2023
2022

Fair value of plan assets at the reporting period end

£
£
Equity instruments
3,811,000
3,466,000
Property
172,000
175,000
Gilts
219,000
189,000
Corporate bonds
329,000
343,000
Cash & other
351,000
486,000
Surplus not recognised
(1,134,000)
(384,000)
3,748,000
4,275,000

In accordance with FRS 102, the overall plan surplus of £1,134,000 (2022: £384,000) has not been recognised as the group has no agreement with the scheme to recover the surplus.

 

25
Share capital
Group and company
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary share capital of £1 each
19,486
19,486
19,480
19,486
26
Reserves
Equity reserve

Share capital account - This reserve records the nominal value of shares that have been issued.

 

Profit and loss account - This reserve records retained earnings and accumulated losses. This reserve also includes a revaluation reserve of £3,099,886 which is non-distributable.

Capital redemption reserve

Capital redemption reserve - This reserve records the nominal value of shares repurchased by the company.

Other reserves

Pension reserve – This reserve records the cumulative net movements in the actuarial valuation of the defined benefit pension scheme made to the Statement of Comprehensive Income.

27
Capital commitments

Amounts contracted for but not provided in the financial statements:

Group
Company
2023
2022
2023
2022
£
£
£
£
Acquisition of tangible fixed assets
-
68,299
-
68,299
M & F (SCOTLAND) LIMITED CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 36 -
28
Cash generated from group operations
2023
2022
£
£
Profit for the year after tax
813,152
186,090
Adjustments for:
Taxation charged
47,608
40,991
Finance costs
64,775
133,253
Investment income
(2,254)
(2,254)
Gain on disposal of tangible fixed assets
(89,707)
(2,574)
Gain on disposal of investment property
(115,000)
-
0
Fair value gain on investment properties
(565,000)
-
0
Depreciation and impairment of tangible fixed assets
142,583
53,952
Gain on sale of investments
-
(50,000)
Pension scheme non-cash movement
(25,000)
83,000
Movements in working capital:
Decrease/(increase) in stocks
649
(2,512)
Decrease in debtors
9,141
21,005
(Decrease)/increase in creditors
(93,227)
21,241
Increase in deferred income
7,954
-
Cash generated from operations
195,674
482,192
29
Cash generated from operations - company
2023
2022
£
£
Profit for the year after tax
676,036
236,562
Adjustments for:
Taxation (credited)/charged
(57)
3,631
Finance costs
62,116
133,253
Investment income
(102,254)
(202,254)
Gain on disposal of tangible fixed assets
(38,057)
-
Gain on disposal of investment property
(115,000)
-
0
Fair value gain on investment properties
(565,000)
-
0
Depreciation and impairment of tangible fixed assets
98,478
30,617
Gain on sale of investments
-
(50,000)
Pension scheme non-cash movement
(25,000)
83,000
Movements in working capital:
Decrease/(increase) in debtors
207,972
(196,178)
Decrease in creditors
(77,991)
(36,522)
Increase in deferred income
7,954
-
Cash generated from operations
129,197
2,109
M & F (SCOTLAND) LIMITED CONSOLIDATION
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2023
- 37 -
30
Analysis of changes in net debt - group
1 October 2022
Cash flows
30 September 2023
£
£
£
Cash at bank and in hand
463,331
(238,605)
224,726
Bank overdrafts
(7,670)
6,312
(1,358)
455,661
(232,293)
223,368
Borrowings excluding overdrafts
(740,274)
404,620
(335,654)
Obligations under finance leases
(54,474)
(218,995)
(273,469)
(339,087)
(46,668)
(385,755)
31
Analysis of changes in net debt - company
1 October 2022
Cash flows
30 September 2023
£
£
£
Cash at bank and in hand
113,222
4,990
118,212
Bank overdrafts
(1,358)
-
(1,358)
111,864
4,990
116,854
Borrowings excluding overdrafts
(740,274)
404,620
(335,654)
Obligations under finance leases
(54,474)
(34,078)
(88,552)
(682,884)
375,532
(307,352)
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