Company registration number 05236339 (England and Wales)
MIDDLETON ASSOCIATES HOLDINGS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2023
MIDDLETON ASSOCIATES HOLDINGS LIMITED
COMPANY INFORMATION
Directors
S R Ashton
B Ashton
Company number
05236339
Registered office
Mentor House
Ainsworth Street
Blackburn
Lancashire
BB1 6AY
Auditor
Pierce C A Limited
Mentor House
Ainsworth Street
Blackburn
Lancashire
BB1 6AY
Bankers
Lloyds TSB
16 Market Place
Oldham
Greater Manchester
OL1 1JG
MIDDLETON ASSOCIATES HOLDINGS LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Profit and loss account
8
Group balance sheet
9
Company balance sheet
10
Group statement of changes in equity
11
Company statement of changes in equity
12
Group statement of cash flows
13
Notes to the financial statements
14 - 27
MIDDLETON ASSOCIATES HOLDINGS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 JULY 2023
- 1 -

The directors present the strategic report for the year ended 31 July 2023.

Fair review of the business

The company is a holding company for the group's trading subsidiary offering management support and property rental.

 

The subsidiary company trades as a wholesaler of beers, wines, spirits and other drinks products, supplying to cash and carry businesses, public houses and retail outlets throughout the United Kingdom.

 

The directors are pleased with the results for the year, which have shown continued growth in both turnover and profitability, following a very successful year ended 31 July 2022. This has been particularly pleasing given there is still significant volatility in the economy, arising from both domestic and international factors, such as the ongoing worldwide conflicts.

 

The trading subsidiary has again reported record turnover and profit before tax of £28.6m and £1m respectively.

Due to the build up of cash in the trading company following this increased turnover, the company has been able to buy more efficiently. The high inflation seen in the UK over the period has enabled the company to increase its profitability.

 

Post year end the company has continued to trade at similar levels to the current financial year, albeit the directors are realistic that trade might not outperform that of the current year.

 

Also after the year end the company has repaid its bank loans ahead of their scheduled repayment dates of the final quarter of 2026. This has been achieved as a result of the trading success of the current and previous financial year. The company has also been able to invest some of its cash into high interest bearing accounts post year end, to take advantage of the current rates of interest.

Principal risks and uncertainties

The group does not actively use financial instruments as part of its financial risk management. The group is exposed to the usual credit and cash flow risks associated with selling on credit and manages this through standard credit control procedures. The directors undertake yearly credit searches on their customers and are willing to adjust credit terms accordingly. The group has a history of very few bad debts, and is able to typically able to recover its debts in a timely manner.

 

The group has historically been funded by retained profits, but, following the Covid-19 pandemic, the group took on external debt in the form of advances under the Coronavirus Business Interruption Loan Scheme, as well as loans from connected entities. As was noted in the fair review of the business, post year end, the group's bank loans have been repaid in full, funded from working capital. The group's exposure to price and liquidity risks is therefore considered to be minimal.

 

The directors are aware of ongoing issues in respect of the cost of living crisis, affecting households across the UK, which may lead to a reduction in demand for the group's services. To safeguard against these potential risks the group will look to continue to offer its products at competitive prices. In addition, the group has continued to be impacted by increasing shipping costs and general stock price increases across the alcoholic and soft drinks industry.

 

The directors are aware that the above factors have led to an expected downturn in customer spending, and that drinking habits are constantly changing and evolving. To safeguard against such issues, the directors are committed to adjusting the group's strategy accordingly, and making sure they are in front or at least in line with their competitors and the market.

 

MIDDLETON ASSOCIATES HOLDINGS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
- 2 -
Development and performance

The group has achieved sales of £28.65m (2022 - £27.47m) and a gross profit margin of 9.0% (2022 - 7.9%). Gross profit margins are a key performance indicator used by the directors to measure the company’s performance.

 

The increase in turnover and profit margin has been reflected in a significantly improved profitability before taxation of £1.3m (2022 - £1.0m).

Future developments

Following the year end the group will look to continue to strengthen their performance, utilising their small team, all of whom are significantly experienced in the industry.

 

The directors are focused on staff retention, which is a vital key performance indicator for the group, as well as customer retention, which they hope to obtain by continuing an excellent price offering and overall quality of service.

 

Plans continue to be made for an e-commerce offering of drinks and home bars/events equipment to the public through the group's website, to sell on other e-commerce platforms, and negotiations are on-going for the group to become the UK agent for a variety of brands.

 

The ability to adapt to the changing requirements is paramount and the group has reacted accordingly.

On behalf of the board

S R Ashton
Director
20 March 2024
MIDDLETON ASSOCIATES HOLDINGS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 JULY 2023
- 3 -

The directors present their annual report and financial statements for the year ended 31 July 2023.

Principal activities

The principal activity of the company has continued to be that of a holding company providing management services to its subsidiary undertaking.

 

The group has continued its principal activity of the wholesale of beers, wines and spirits.

Results and dividends

The results for the year are set out on page 8.

During the year dividends of £2,000 (2022: £2,000) were paid in respect of the ordinary shares.

 

The directors do not recommend payment of a final dividend.

Directors

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

S R Ashton
B Ashton
Auditor

In accordance with the company's articles, a resolution proposing that Pierce C A Limited be reappointed as auditor of the group will be put at a General Meeting.

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.

Medium-sized companies exemption

This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.

On behalf of the board
S R Ashton
Director
20 March 2024
MIDDLETON ASSOCIATES HOLDINGS LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 JULY 2023
- 4 -

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.

MIDDLETON ASSOCIATES HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF MIDDLETON ASSOCIATES HOLDINGS LIMITED
- 5 -
Opinion

We have audited the financial statements of Middleton Associates Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 July 2023 which comprise the group profit and loss account, 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:

MIDDLETON ASSOCIATES HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF MIDDLETON ASSOCIATES HOLDINGS LIMITED
- 6 -
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.

In identifying and assessing risks of material misstatements in respect of irregularities (including fraud) we considered the following:

 

We have also performed specific procedures to consider the risk of management override and of fraud arising in significant transactions outside the normal course of business.

We did not identify a material risk of non-compliance with laws and regulations or of fraud.

 

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.

MIDDLETON ASSOCIATES HOLDINGS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF MIDDLETON ASSOCIATES HOLDINGS LIMITED
- 7 -

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.

Jane Smith (Senior Statutory Auditor)
For and on behalf of Pierce C. A. Limited
21 March 2024
Statutory Auditor
Mentor House
Ainsworth Street
Blackburn
Lancashire
BB1 6AY
MIDDLETON ASSOCIATES HOLDINGS LIMITED
GROUP PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 JULY 2023
- 8 -
2023
2022
Notes
£
£
Turnover
2
28,653,045
27,513,494
Cost of sales
(26,083,529)
(25,330,752)
Gross profit
2,569,516
2,182,742
Administrative expenses
(1,243,785)
(1,136,527)
Other operating income
-
4,565
Operating profit
3
1,325,731
1,050,780
Interest receivable and similar income
7
1,259
6,284
Interest payable and similar expenses
8
(33,886)
(47,064)
Amounts written off investments
9
1,013
(6)
Profit before taxation
1,294,117
1,009,994
Tax on profit
10
(270,061)
(211,153)
Profit for the financial year
1,024,056
798,841
Profit for the financial year is all attributable to the owner of the parent company.

The profit and loss account has been prepared on the basis that all operations are continuing operations.

MIDDLETON ASSOCIATES HOLDINGS LIMITED
GROUP BALANCE SHEET
AS AT
31 JULY 2023
31 July 2023
- 9 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
12
1,560,330
1,579,741
Investments
14
11,753
950
1,572,083
1,580,691
Current assets
Stocks
16
4,526,759
2,699,980
Debtors
17
2,510,282
2,523,029
Cash at bank and in hand
1,952,996
2,269,057
8,990,037
7,492,066
Creditors: amounts falling due within one year
18
(4,165,271)
(3,293,943)
Net current assets
4,824,766
4,198,123
Total assets less current liabilities
6,396,849
5,778,814
Creditors: amounts falling due after more than one year
19
(527,366)
(919,867)
Provisions for liabilities
Deferred tax liability
21
243,379
254,899
(243,379)
(254,899)
Net assets
5,626,104
4,604,048
Capital and reserves
Called up share capital
22
100
100
Non-distributable profits reserve
23
617,818
617,818
Distributable profit and loss reserves
5,008,186
3,986,130
Total equity
5,626,104
4,604,048

These financial statements have been prepared in accordance with the provisions relating to medium-sized groups.

The financial statements were approved by the board of directors and authorised for issue on 20 March 2024 and are signed on its behalf by:
20 March 2024
S R Ashton
Director
Company registration number 05236339 (England and Wales)
MIDDLETON ASSOCIATES HOLDINGS LIMITED
COMPANY BALANCE SHEET
AS AT 31 JULY 2023
31 July 2023
- 10 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
12
11,176
11,176
Investment property
13
1,300,000
1,300,000
Investments
14
240,100
240,100
1,551,276
1,551,276
Current assets
Debtors
17
3,273,043
2,806,935
Cash at bank and in hand
172,694
142,944
3,445,737
2,949,879
Creditors: amounts falling due within one year
18
(112,006)
(133,939)
Net current assets
3,333,731
2,815,940
Total assets less current liabilities
4,885,007
4,367,216
Creditors: amounts falling due after more than one year
19
(527,366)
(583,818)
Provisions for liabilities
Deferred tax liability
21
194,229
194,229
(194,229)
(194,229)
Net assets
4,163,412
3,589,169
Capital and reserves
Called up share capital
22
100
100
Non-distributable profits reserve
23
617,818
617,818
Distributable profit and loss reserves
3,545,494
2,971,251
Total equity
4,163,412
3,589,169

 

These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.true

The financial statements were approved by the board of directors and authorised for issue on 20 March 2024 and are signed on its behalf by:
20 March 2024
S R Ashton
Director
Company registration number 05236339 (England and Wales)
MIDDLETON ASSOCIATES HOLDINGS LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JULY 2023
- 11 -
Share capital
Non-distri-butable profits
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 August 2021
100
623,435
3,183,672
3,807,207
Year ended 31 July 2022:
Profit and total comprehensive income
-
(5,617)
804,458
798,841
Dividends
11
-
-
(2,000)
(2,000)
Balance at 31 July 2022
100
617,818
3,986,130
4,604,048
Year ended 31 July 2023:
Profit and total comprehensive income
-
-
1,024,056
1,024,056
Dividends
11
-
-
(2,000)
(2,000)
Balance at 31 July 2023
100
617,818
5,008,186
5,626,104
MIDDLETON ASSOCIATES HOLDINGS LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JULY 2023
- 12 -
Share capital
Non-distri-butable profits
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 August 2021
100
623,435
2,420,207
3,043,742
Year ended 31 July 2022:
Profit and total comprehensive income for the year
-
(5,617)
553,044
547,427
Dividends
11
-
-
(2,000)
(2,000)
Balance at 31 July 2022
100
617,818
2,971,251
3,589,169
Year ended 31 July 2023:
Profit and total comprehensive income
-
-
576,243
576,243
Dividends
11
-
-
(2,000)
(2,000)
Balance at 31 July 2023
100
617,818
3,545,494
4,163,412
MIDDLETON ASSOCIATES HOLDINGS LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 JULY 2023
- 13 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
25
234,024
349,527
Interest paid
(17,903)
(21,440)
Income taxes paid
(162,735)
(61,859)
Net cash inflow from operating activities
53,386
266,228
Investing activities
Purchase of tangible fixed assets
(47,047)
(203,212)
Proceeds from disposal of tangible fixed assets
-
19,900
Proceeds from disposal of investments
(9,790)
-
Interest received
1,259
-
Net cash used in investing activities
(55,578)
(183,312)
Financing activities
(Repayment)/receipt of borrowings
(199,142)
685,319
Repayment of bank loans
(112,727)
(102,727)
Dividends paid to equity shareholders
(2,000)
(2,000)
Net cash (used in)/generated from financing activities
(313,869)
580,592
Net (decrease)/increase in cash and cash equivalents
(316,061)
663,508
Cash and cash equivalents at beginning of year
2,269,057
1,605,549
Cash and cash equivalents at end of year
1,952,996
2,269,057
MIDDLETON ASSOCIATES HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2023
- 14 -
1
Accounting policies
Company information

Middleton Associates Holdings Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Mentor House, Ainsworth Street, Blackburn, Lancashire BB1 6AY.

 

The group consists of Middleton Associates Holdings Limited and all of its subsidiary.

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, modified to include the revaluation of investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.

1.2
Basis of consolidation

The consolidated group financial statements consist of the financial statements of the parent company Middleton Associates Holdings 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 31 July 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.

1.3
Going concern

At the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.4
Turnover

Turnover represents amounts receivable for goods net of VAT and trade discounts and has been wholly derived from the group's principal activity.

MIDDLETON ASSOCIATES HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
1
Accounting policies
(Continued)
- 15 -
1.5
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:

Freehold land and buildings
Not depreciated
Leasehold improvements
Not depreciated
Plant and equipment
20% straight line
Fixtures and fittings
15% & 20% straight line
Motor vehicles
20% straight line

Freehold land and leasehold improvements are not depreciated.

 

Freehold property is not depreciated as it is deemed that the market value of the property and its net book value do not materially differ.

 

Included within motor vehicles are vehicle registration plates which have not been depreciated as they are held as long term investments and the total net realisable value is expected to exceed the total cost.

 

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.

1.6
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.

1.7
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.

1.8
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.

1.9
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.

MIDDLETON ASSOCIATES HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
1
Accounting policies
(Continued)
- 16 -
1.10
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.

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.

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.

MIDDLETON ASSOCIATES HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
1
Accounting policies
(Continued)
- 17 -
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.

Derecognition of financial liabilities

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

1.11
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.

1.12
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.

1.13
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.

MIDDLETON ASSOCIATES HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
1
Accounting policies
(Continued)
- 18 -
1.14
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.

2
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
From group principal activity
28,653,045
27,513,494
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
28,653,045
27,513,494
2023
2022
£
£
Other revenue
Interest income
1,259
6,284
3
Operating profit
2023
2022
£
£
Operating profit for the year is stated after charging/(crediting):
Job retention scheme monies received and receivable
-
(3,370)
CBILS loan interest - incentive element
-
(1,195)
Depreciation of owned tangible fixed assets
66,458
57,023
Profit on disposal of tangible fixed assets
-
(15,583)
Operating lease charges
26,962
25,552
4
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
5,610
5,100
Audit of the financial statements of the company's subsidiaries
9,075
8,250
14,685
13,350
MIDDLETON ASSOCIATES HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
- 19 -
5
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
18
17
2
2

Their aggregate remuneration comprised:

Group
Company
2023
2022
2023
2022
£
£
£
£
Wages and salaries
728,047
629,525
98,000
18,000
Social security costs
70,238
58,285
13,421
1,694
Pension costs
21,703
61,162
-
0
-
0
819,988
748,972
111,421
19,694
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
155,831
96,411
7
Interest receivable and similar income
2023
2022
£
£
Interest income
Other interest income
1,259
6,284
8
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Other interest on financial liabilities
17,903
11,835
Other finance costs:
Other interest
15,983
35,229
Total finance costs
33,886
47,064
MIDDLETON ASSOCIATES HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
- 20 -
9
Amounts written off investments
2023
2022
£
£
Fair value gains/(losses) on financial instruments
Gain/(loss) on financial assets held at fair value through profit or loss
1,013
(6)
10
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
281,581
162,734
Deferred tax
Origination and reversal of timing differences
(11,520)
48,419
Total tax charge
270,061
211,153

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
1,294,117
1,009,994
Expected tax charge based on the standard rate of corporation tax in the UK of 21.01% (2022: 19.00%)
271,835
191,899
Tax effect of expenses that are not deductible in determining taxable profit
1,350
615
Effect of change in corporation tax rate
-
5,617
Permanent capital allowances in excess of depreciation
(3,124)
13,022
Taxation charge
270,061
211,153
11
Dividends
2023
2022
Recognised as distributions to equity holders:
£
£
Final paid
2,000
2,000
MIDDLETON ASSOCIATES HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
- 21 -
12
Tangible fixed assets
Group
Freehold land and buildings
Leasehold improvements
Plant and equipment
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
£
£
Cost
At 1 August 2022
1,305,000
13,695
58,114
136,037
244,905
1,757,751
Additions
-
0
-
0
1,149
22,980
22,918
47,047
At 31 July 2023
1,305,000
13,695
59,263
159,017
267,823
1,804,798
Depreciation and impairment
At 1 August 2022
-
0
-
0
35,669
80,983
61,358
178,010
Depreciation charged in the year
-
0
-
0
5,522
12,546
48,390
66,458
At 31 July 2023
-
0
-
0
41,191
93,529
109,748
244,468
Carrying amount
At 31 July 2023
1,305,000
13,695
18,072
65,488
158,075
1,560,330
At 31 July 2022
1,305,000
13,695
22,445
55,054
183,547
1,579,741
Company
Plant and equipment
£
Cost
At 1 August 2022 and 31 July 2023
11,176
Depreciation and impairment
At 1 August 2022 and 31 July 2023
-
0
Carrying amount
At 31 July 2023
11,176
At 31 July 2022
11,176

Freehold land and buildings in stated at the director's estimate of open market value as at 31 July 2023. Had the property not been revalued its historic cost would have been £487,952 (2022: £487,952).

MIDDLETON ASSOCIATES HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
- 22 -
13
Investment property
Group
Company
2023
2023
£
£
Fair value
At 1 August 2022 and 31 July 2023
-
1,300,000

The investment property is stated at the director's estimate of open market value as at 31 July 2023. Had the property not been revalued its historic cost would have been £487,952 (2022: £487,952).

14
Fixed asset investments
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Investments in subsidiaries
15
-
0
-
0
240,100
240,100
Listed investments
11,753
950
-
0
-
0
11,753
950
240,100
240,100
Movements in fixed asset investments
Group
Investments
£
Cost or valuation
At 1 August 2022
950
Additions
9,789
Valuation changes
1,014
At 31 July 2023
11,753
Carrying amount
At 31 July 2023
11,753
At 31 July 2022
950
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 August 2022 and 31 July 2023
240,100
Carrying amount
At 31 July 2023
240,100
At 31 July 2022
240,100
MIDDLETON ASSOCIATES HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
- 23 -
15
Subsidiaries

Details of the company's subsidiaries at 31 July 2023 are as follows:

Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Middleton Associates Limited
1 - Below
Ordinary
100.00

Registered office addresses (all UK unless otherwise indicated):

1
Mentor House, Ainsworth Street, Blackburn, Lancashire, BB1 6AY
16
Stocks
Group
Company
2023
2022
2023
2022
£
£
£
£
Finished goods and goods for resale
4,526,759
2,699,980
-
0
-
0
17
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade debtors
2,005,884
2,017,721
250,000
300,000
Amounts owed by group undertakings
-
-
3,013,908
2,413,908
Other debtors
465,509
462,878
9,133
93,026
Prepayments and accrued income
38,889
42,430
-
-
2,510,282
2,523,029
3,273,041
2,806,934

Included in Other debtors are amounts owed by the director of £Nil (2022: £85,126).

 

Also included within Other debtors are interest free loans due from connected companies of £236,936 (2022: £309,654).

MIDDLETON ASSOCIATES HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
- 24 -
18
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans
20
336,061
112,739
-
0
-
0
Other borrowings
20
431,013
442,845
55,963
67,795
Trade creditors
2,796,246
1,827,149
-
0
-
0
Corporation tax payable
281,580
162,734
46,865
62,874
Other taxation and social security
15,342
245,806
-
-
Other creditors
232,610
457,000
898
-
0
Accruals and deferred income
72,419
45,670
8,280
3,270
4,165,271
3,293,943
112,006
133,939

Other borrowings includes amounts owed of £56,686 (2022: £67,795) relating to a loan from the Middleton Associates Pension Scheme.

19
Creditors: amounts falling due after more than one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans and overdrafts
20
-
0
336,049
-
0
-
0
Other borrowings
20
527,366
583,818
527,366
583,818
527,366
919,867
527,366
583,818

Other borrowings includes amounts owed of £200,366 (2022: £256,818) relating to a loan from the Middleton Associates Pension Scheme.

MIDDLETON ASSOCIATES HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
- 25 -
20
Loans and overdrafts
Group
Company
2023
2022
2023
2022
£
£
£
£
Bank loans
336,061
448,788
-
0
-
0
Other loans
958,379
1,026,663
583,329
651,613
1,294,440
1,475,451
583,329
651,613
Payable within one year
767,074
555,584
55,963
67,795
Payable after one year
527,366
919,867
527,366
583,818

The group's bank loan is secured by an unlimited debenture incorporating a fixed and floating charge. After the year end the group has repaid its bank loans in full, and as such, the amounts have been classified as being due within one year.

 

The group's other loans comprises of £256,329 (2022: £324,613) relating to a loan from the Middleton Associates Pension Scheme, of £249,000 (2022: £249,000) relating to a loan from a connected company and of £453,050 (2022: £453,050) relating to loans from two connected Trusts.

 

Amounts owed to the Middleton Associates Pension Scheme are secured by way of a first legal charge over the group's investment property, Unit 2a, Gorse Street, Chadderton.

 

Amounts owed to the connected company and the Trusts are unsecured.

MIDDLETON ASSOCIATES HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
- 26 -
21
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
49,150
60,670
Revaluations
194,229
194,229
243,379
254,899
Liabilities
Liabilities
2023
2022
Company
£
£
Revaluations
194,229
194,229
Group
Company
2023
2023
Movements in the year:
£
£
Liability at 1 August 2022
254,899
194,229
Credit to profit or loss
(11,520)
-
Liability at 31 July 2023
243,379
194,229
22
Share capital
Group and company
2023
2022
Ordinary share capital
£
£
Issued and fully paid
100 Ordinary shares of £1 each
100
100
23
Non-distributable profits reserve
Group
Company
2023
2022
2023
2022
£
£
£
£
At the beginning of the year
617,818
623,435
617,818
623,435
Non distributable profits in the year
-
(5,617)
-
(5,617)
At the end of the year
617,818
617,818
617,818
617,818

The non-distributable profits reserve relates to the revaluation applied to the company's investment property adjusted for the deferred tax provision in respect of the revalued amounts.

MIDDLETON ASSOCIATES HOLDINGS LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2023
- 27 -
24
Controlling party

The company is controlled by Mr S R Ashton by virtue of his majority shareholding in the company.

25
Cash generated from group operations
2023
2022
£
£
Profit for the year after tax
1,024,056
798,841
Adjustments for:
Taxation charged
270,061
211,153
Finance costs
33,886
47,064
Investment income
(1,259)
(6,284)
Gain on disposal of tangible fixed assets
-
(15,583)
Depreciation and impairment of tangible fixed assets
66,458
57,023
Other gains and losses
(1,013)
6
Movements in working capital:
Increase in stocks
(1,826,779)
(1,151,122)
Increase in debtors
(22,378)
(374,800)
Increase in creditors
690,992
783,229
Cash generated from operations
234,024
349,527
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