Company Registration No. 05175060 (England and Wales)
MACDOUGALL ARTS LTD
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
PAGES FOR FILING WITH REGISTRAR
MACDOUGALL ARTS LTD
CONTENTS
Page
Balance sheet
1
Notes to the financial statements
2 - 6
MACDOUGALL ARTS LTD
BALANCE SHEET
AS AT
31 MARCH 2023
31 March 2023
- 1 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
4
1,629
2,840
Current assets
Stocks
294,021
827,201
Debtors
5
979,547
483,578
Cash at bank and in hand
754,093
655,136
2,027,661
1,965,915
Creditors: amounts falling due within one year
6
(918,179)
(732,721)
Net current assets
1,109,482
1,233,194
Net assets
1,111,111
1,236,034
Capital and reserves
Called up share capital
1,000
1,000
Profit and loss reserves
1,110,111
1,235,034
Total equity
1,111,111
1,236,034

The director of the company has elected not to include a copy of the profit and loss account within the financial statements.true

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

The financial statements were approved by the board of directors and authorised for issue on 8 February 2024 and are signed on its behalf by:
C  MacDougall
Director
Company registration number 05175060 (England and Wales)
MACDOUGALL ARTS LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
- 2 -
1
Accounting policies
Company information

MacDougall Arts Ltd is a private company limited by shares incorporated in England and Wales. The registered office is 33 St James's Square, London, SW1Y 4JS.

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.

1.2
Going concern

These financial statements are prepared on the going concern basis. The director has a reasonable expectation that the company will continue in operational existence for the foreseeable future. However, the director is aware of certain material uncertainties which may cause doubt on the company's ability to continue as a going concern. The increased economic sanctions applied to the Russian Federation mean that the company is unable to sell artwork to customers residing in Russia for the foreseeable future. No auctions took place in 2022 although the company did undertake a successful online auction on 25 March 2023. The company is also diversifying into other sectors of the art market, such as Ecole de Paris, to reduce its exposure to one market.

1.3
Turnover

Turnover represents the buyer's premium, seller's commission and other fees, excluding VAT, for auctions and private sales during the period. Proceeds from the sales of works of art are included within turnover and the costs of acquiring works of art and any stock adjustments are included within cost of sales.

1.4
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:

Computer equipment
25% 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 credited or charged to profit or loss.

1.5
Stocks

Stocks of paintings are stated at the lower of cost and estimated selling price less costs to complete and sell.

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.

MACDOUGALL ARTS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 3 -
1.6
Cash at bank and in hand

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.

Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recognised in profit or loss immediately, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.

1.9
Taxation

The tax expense represents the sum of the tax currently payable.

MACDOUGALL ARTS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 4 -

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.

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
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

1.13

Debtors and creditors

Amounts receivable from purchasers and payable to consignors as a result of sales by auction are recognised as debtors and creditors respectively although the company has no legal obligation to pay the proceeds of sale to a consignor until it has received payment from the purchaser.

2
Judgements and key sources of estimation uncertainty

In the application of the company’s accounting policies, the director is 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.

Critical judgements

The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.

Stock

Stock is valued at the lower of cost and net realisable value. Impairments have been made for the effect of the Covid-19 pandemic and restricted trading activities due to Russian sanctions.

MACDOUGALL ARTS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 5 -
3
Employees

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

2023
2022
Number
Number
Total
4
8
4
Tangible fixed assets
Plant and machinery etc
£
Cost
At 1 April 2022
29,135
Disposals
(15,256)
At 31 March 2023
13,879
Depreciation and impairment
At 1 April 2022
26,295
Depreciation charged in the year
1,211
Eliminated in respect of disposals
(15,256)
At 31 March 2023
12,250
Carrying amount
At 31 March 2023
1,629
At 31 March 2022
2,840
5
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
928,219
224,824
Corporation tax recoverable
-
0
104,905
Other debtors
2,850
79,378
Prepayments and accrued income
48,478
74,471
979,547
483,578
MACDOUGALL ARTS LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 6 -
6
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
765,823
69,481
Taxation and social security
28,246
5,442
Other creditors
70,651
610,245
Accruals and deferred income
53,459
47,553
918,179
732,721
7
Audit report information

As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:

The auditor's report was unqualified.

 

The report includes details of a material uncertainty in relation to going concern as below:

 

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. We draw attention to note 1.2 of the financial statements which describes the basis of the going concern assumption. The increased economic sanctions applied to the Russian Federation mean that the company is unable to sell artwork to customers residing in Russia for the foreseeable future. These conditions indicate that a material uncertainty exists that may cast significant doubt on the company’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. Our opinion is not modified in respect of this matter.

 

Senior Statutory Auditor:
Christopher Bates FCA
Statutory Auditor:
Begbies
8
Financial commitments, guarantees and contingent liabilities

A guarantee against counterfeit items, subject to the applicable terms and conditions of sale, is given to the purchaser by the company in respect of all lots sold at auction. This guarantee is valid for one year from the date of sale. There are no material unsettled claims which, in the opinion of the director, would be likely to result in a material liability to the company. The company also has PI insurance to cover such claims.

 

A guarantee of £100,000 has been provided to HM Revenue & Customs in respect of temporary importations. This guarantee has been made by the company's bankers and is backed by restricted cash at bank included on the Balance Sheet.

2023-03-312022-04-01false14 March 2024CCH SoftwareCCH Accounts Production 2023.200No description of principal activityThis audit opinion is unqualifiedC MacDougallW MacDougall051750602022-04-012023-03-31051750602023-03-31051750602022-03-3105175060core:OtherPropertyPlantEquipment2023-03-3105175060core:OtherPropertyPlantEquipment2022-03-3105175060core:CurrentFinancialInstrumentscore:WithinOneYear2023-03-3105175060core:CurrentFinancialInstrumentscore:WithinOneYear2022-03-3105175060core:CurrentFinancialInstruments2023-03-3105175060core:CurrentFinancialInstruments2022-03-3105175060core:ShareCapital2023-03-3105175060core:ShareCapital2022-03-3105175060core:RetainedEarningsAccumulatedLosses2023-03-3105175060core:RetainedEarningsAccumulatedLosses2022-03-3105175060bus:Director12022-04-012023-03-3105175060core:ComputerEquipment2022-04-012023-03-31051750602021-04-012022-03-3105175060core:OtherPropertyPlantEquipment2022-03-3105175060core:OtherPropertyPlantEquipment2022-04-012023-03-3105175060bus:PrivateLimitedCompanyLtd2022-04-012023-03-3105175060bus:SmallCompaniesRegimeForAccounts2022-04-012023-03-3105175060bus:FRS1022022-04-012023-03-3105175060bus:Audited2022-04-012023-03-3105175060bus:Director22022-04-012023-03-3105175060bus:FullAccounts2022-04-012023-03-31xbrli:purexbrli:sharesiso4217:GBP