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REGISTERED NUMBER: SC231973 (Scotland)















Strategic Report, Report of the Directors and

Financial Statements for the Year Ended 31 July 2023

for

Cheyne's (Management) Limited

Cheyne's (Management) Limited (Registered number: SC231973)






Contents of the Financial Statements
for the Year Ended 31 July 2023




Page

Company Information 1

Strategic Report 2

Report of the Directors 3

Report of the Independent Auditors 5

Income Statement 9

Other Comprehensive Income 10

Statement of Financial Position 11

Statement of Changes in Equity 12

Statement of Cash Flows 13

Notes to the Statement of Cash Flows 14

Notes to the Financial Statements 15


Cheyne's (Management) Limited

Company Information
for the Year Ended 31 July 2023







DIRECTORS: Mrs S Adamczuk
P Adamczuk





REGISTERED OFFICE: 46 George Street
Edinburgh
EH2 2LE





REGISTERED NUMBER: SC231973 (Scotland)





AUDITORS: Douglas Home & Co (Audit) Ltd (Statutory Auditor)
47-49 The Square
Kelso
Roxburghshire
TD5 7HW

Cheyne's (Management) Limited (Registered number: SC231973)

Strategic Report
for the Year Ended 31 July 2023

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

The principal activities of the company in the year under review were those of Hairdressing Salons, Hairdressing Training delivering NVQ qualifications, educational hairdressing seminars and shows.

REVIEW OF BUSINESS
The Directors are satisfied with the performance for the year in view of the restructuring that has taken place.

While there were substantial costs incurred in consolidating the business from 4 to 3 salons, the reduction in ongoing costs has proven to be positive and will lead to stronger profitability going forward. Overheads have been significantly reduced and staff retention is high due to the 'new' business footprint.

PRINCIPAL RISKS AND UNCERTAINTIES
The current economic situation across the UK, driven by both domestic and worldwide events, have undoubtedly had an impact on consumer confidence but the Directors are confident that the measures taken to consolidate the business has created a strong platform for improved financial results in the months and years ahead.

ON BEHALF OF THE BOARD:





Director


19 February 2024

Cheyne's (Management) Limited (Registered number: SC231973)

Report of the Directors
for the Year Ended 31 July 2023

The directors present their report with the financial statements of the company for the year ended 31 July 2023.

PRINCIPAL ACTIVITY
The principal activity of the company in the year under review was that of Hairdressing Salons, Hairdressing Training delivering NVQ qualifications, educational hairdressing seminars and shows.

DIVIDENDS
No dividends will be distributed for the year ended 31 July 2023.

EVENTS SINCE THE END OF THE YEAR
Information relating to events since the end of the year is given in the notes to the financial statements.

DIRECTORS
The directors shown below have held office during the whole of the period from 1 August 2022 to the date of this report.

Mrs S Adamczuk
P Adamczuk
N R Stitt

Other changes in directors holding office are as follows:

N R Stitt ceased to be a director after 31 July 2023 but prior to the date of this report.

GOING CONCERN
In carrying out their duties in respect of going concern, the directors have carried out a review of the group's financial position for a period of 12 months from the date of signing these financial statements. The company currently meets its day to day working capital requirements through its cash balance, which is sufficient to cover working capital requirements. The directors have a reasonable expectation that the group have adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the annual reports and accounts.

STATEMENT OF DIRECTORS' RESPONSIBILITIES
The directors are responsible for preparing the Strategic Report, the Report of the Directors 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), including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

-select suitable accounting policies and then apply them consistently;
-make judgements and accounting estimates that are reasonable and prudent;
-prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

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

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

Cheyne's (Management) Limited (Registered number: SC231973)

Report of the Directors
for the Year Ended 31 July 2023


AUDITORS
The auditors, Douglas Home & Co (Audit) Ltd (Statutory Auditor), will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:





P Adamczuk - Director


19 February 2024

Report of the Independent Auditors to the Members of
Cheyne's (Management) Limited

Opinion
We have audited the financial statements of Cheyne's (Management) Limited (the 'company') for the year ended 31 July 2023 which comprise the Income Statement, Other Comprehensive Income, Statement of Financial Position, Statement of Changes in Equity, Statement of Cash Flows and Notes to the Statement of Cash Flows, Notes to the Financial Statements, including a summary of 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:
-give a true and fair view of the state of the company's affairs as at 31 July 2023 and of its loss for the year then ended;
-have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
-have been prepared in accordance with the requirements of the Companies Act 2006.

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 Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the 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 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 directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

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.

In connection with our audit of the financial statements, 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 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 the audit:
- the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and
- the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Report of the Independent Auditors to the Members of
Cheyne's (Management) Limited


Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Report of the Directors.

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
- adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
- the financial statements are not in agreement with the accounting records and returns; or
- certain disclosures of directors' remuneration specified by law are not made; or
- we have not received all the information and explanations we require for our audit.
- the directors were not entitled to prepare the financial statements in accordance with the small companies regime and take advantage of the small companies' exemptions in preparing the directors' report and from the requirement to prepare a strategic report.

Responsibilities of directors
As explained more fully in the Statement of Directors' Responsibilities set out on page three, 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 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 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 company or to cease operations, or have no realistic alternative but to do so.

Report of the Independent Auditors to the Members of
Cheyne's (Management) Limited


Auditors' 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 a Report of the Auditors 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:

We obtained an understanding of the legal and regulatory frameworks that are applicable to the entity, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included the Companies Act 2006, FRS102 and local tax legislation. The engagement partner ensured the engagement team had the necessary competence, capabilities, and skills to identify laws and regulations and they remained alert to such matters throughout the audit.

Based on the results of our risk assessments we designed our audit procedures to identify non-compliance with such laws and regulation. We identified and evaluated the laws and regulations and enquired of management whether they were aware of any instances of non-compliance. We corroborated these through review of legal and professional fees and any correspondence with HMRC, alongside a review of Companies House updates. A full disclosure checklist was carried out. Tax computations were checked for accuracy of calculations and inputs.

In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which may be fundamental to the company's ability to operate or to avoid a material penalty. The laws and regulations we considered in this context included UK Employment Law, Data Protection Act 2018 and Health and Safety regulations.

Based on the results of our risk assessments we designed our audit procedures to identify non-compliance with such laws and regulation. We identified and evaluated the laws and regulation and enquired with management whether they were aware of any instances of non-compliance and what procedures were in place to ensure compliance. We corroborated this through review of correspondence with any regulators, review of policies for health and safety and data protection and reviewing submissions to HMRC. A walk through of the payroll processes was performed including review of contracts, gross to net pay checks, and verification checks of staff.

We assessed the risks of material misstatement in respect of fraud via enquiries of management and those charged with governance as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud and considered the internal controls in place to mitigate risks of fraud. Permissions on the accounting software were checked and were appropriate to the staff role, access to online banking for making payments was also established, and evidence of authorisation and allocations of major expenditure were sought. The directors are heavily involved in the day to day running of the business and have good knowledge of the amount and expected timing of receipts from customers and payments to suppliers.

To address the risk of fraud through management bias and override of controls we performed analytical procedures to identify any unusual or unexpected relationships, tested journal entries to identify unusual transactions, assessed the level of subjectivity and estimation within the account balances and investigated the rationale behind any significant or unusual transactions. The preparation of the yearly accounts by DHCO mitigates this risk.

With regard to identification of material misstatements in relation to fraud, we considered income recognition in line with FRS102, reviewed the appropriateness of the accounting policies selected and reviewed disclosures for completeness and accuracy. We also identified related parties and reviewed the completeness and accuracy of related party transactions.

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

Report of the Independent Auditors to the Members of
Cheyne's (Management) Limited


A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

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 a Report of the Auditors 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.




Alan Drummond BA CA FMAAT (Senior Statutory Auditor)
for and on behalf of Douglas Home & Co (Audit) Ltd (Statutory Auditor)
47-49 The Square
Kelso
Roxburghshire
TD5 7HW

22 February 2024

Cheyne's (Management) Limited (Registered number: SC231973)

Income Statement
for the Year Ended 31 July 2023

31/7/23 31/7/22
Notes £    £   

REVENUE 3 3,831,865 4,106,290

Cost of sales 2,912,681 2,990,445
GROSS PROFIT 919,184 1,115,845

Administrative expenses 1,445,440 932,007
(526,256 ) 183,838

Other operating income 14,961 27,150
OPERATING (LOSS)/PROFIT 5 (511,295 ) 210,988

Interest receivable and similar income 546 20
(510,749 ) 211,008

Interest payable and similar expenses 6 13,821 14,186
(LOSS)/PROFIT BEFORE TAXATION (524,570 ) 196,822

Tax on (loss)/profit 7 (29,631 ) 41,590
(LOSS)/PROFIT FOR THE FINANCIAL
YEAR

(494,939

)

155,232

Cheyne's (Management) Limited (Registered number: SC231973)

Other Comprehensive Income
for the Year Ended 31 July 2023

31/7/23 31/7/22
Notes £    £   

(LOSS)/PROFIT FOR THE YEAR (494,939 ) 155,232


OTHER COMPREHENSIVE INCOME - -
TOTAL COMPREHENSIVE INCOME
FOR THE YEAR

(494,939

)

155,232

Cheyne's (Management) Limited (Registered number: SC231973)

Statement of Financial Position
31 July 2023

31/7/23 31/7/22
Notes £    £    £    £   
FIXED ASSETS
Intangible assets 8 3,870,000 4,300,000
Property, plant and equipment 9 73,092 135,529
3,943,092 4,435,529

CURRENT ASSETS
Inventories 10 46,349 51,773
Debtors 11 499,101 516,934
Cash at bank and in hand 250,290 375,080
795,740 943,787
CREDITORS
Amounts falling due within one year 12 720,879 710,387
NET CURRENT ASSETS 74,861 233,400
TOTAL ASSETS LESS CURRENT
LIABILITIES

4,017,953

4,668,929

CREDITORS
Amounts falling due after more than one
year

13

(123,313

)

(257,350

)

PROVISIONS FOR LIABILITIES 17 (1,500 ) (23,500 )
NET ASSETS 3,893,140 4,388,079

CAPITAL AND RESERVES
Called up share capital 18 1,000 1,000
Retained earnings 3,892,140 4,387,079
SHAREHOLDERS' FUNDS 3,893,140 4,388,079

The financial statements were approved by the Board of Directors and authorised for issue on 19 February 2024 and were signed on its behalf by:





P Adamczuk - Director


Cheyne's (Management) Limited (Registered number: SC231973)

Statement of Changes in Equity
for the Year Ended 31 July 2023

Called up
share Retained Total
capital earnings equity
£    £    £   
Balance at 1 August 2021 1,000 4,231,847 4,232,847

Changes in equity
Total comprehensive income - 155,232 155,232
Balance at 31 July 2022 1,000 4,387,079 4,388,079

Changes in equity
Total comprehensive income - (494,939 ) (494,939 )
Balance at 31 July 2023 1,000 3,892,140 3,893,140

Cheyne's (Management) Limited (Registered number: SC231973)

Statement of Cash Flows
for the Year Ended 31 July 2023

31/7/23 31/7/22
Notes £    £   
Cash flows from operating activities
Cash generated from operations 1 65,086 16,903
Interest paid (13,821 ) (14,186 )
Government grants - 12,000
Tax paid (43,520 ) (34,923 )
Net cash from operating activities 7,745 (20,206 )

Cash flows from investing activities
Purchase of tangible fixed assets (1,666 ) (16,192 )
Interest received 546 20
Net cash from investing activities (1,120 ) (16,172 )

Cash flows from financing activities
Loan repayments in year (131,415 ) (135,571 )
Net cash from financing activities (131,415 ) (135,571 )

Decrease in cash and cash equivalents (124,790 ) (171,949 )
Cash and cash equivalents at beginning of
year

2

375,080

547,029

Cash and cash equivalents at end of year 2 250,290 375,080

Cheyne's (Management) Limited (Registered number: SC231973)

Notes to the Statement of Cash Flows
for the Year Ended 31 July 2023

1. RECONCILIATION OF (LOSS)/PROFIT BEFORE TAXATION TO CASH GENERATED FROM
OPERATIONS
31/7/23 31/7/22
£    £   
(Loss)/profit before taxation (524,570 ) 196,822
Depreciation charges 475,727 54,003
Loss on disposal of fixed assets 18,376 -
Government grants - (12,000 )
Finance costs 13,821 14,186
Finance income (546 ) (20 )
(17,192 ) 252,991
Decrease in inventories 5,424 18,240
Decrease/(increase) in trade and other debtors 24,981 (284,372 )
Increase in trade and other creditors 51,873 30,044
Cash generated from operations 65,086 16,903

2. CASH AND CASH EQUIVALENTS

The amounts disclosed on the Statement of Cash Flows in respect of cash and cash equivalents are in respect of these Statement of Financial Position amounts:

Year ended 31 July 2023
31/7/23 1/8/22
£    £   
Cash and cash equivalents 250,290 375,080
Year ended 31 July 2022
31/7/22 1/8/21
£    £   
Cash and cash equivalents 375,080 547,029


3. ANALYSIS OF CHANGES IN NET DEBT

At 1/8/22 Cash flow At 31/7/23
£    £    £   
Net cash
Cash at bank and in hand 375,080 (124,790 ) 250,290
375,080 (124,790 ) 250,290
Debt
Debts falling due within 1 year (131,415 ) (2,622 ) (134,037 )
Debts falling due after 1 year (257,350 ) 134,037 (123,313 )
(388,765 ) 131,415 (257,350 )
Total (13,685 ) 6,625 (7,060 )

Cheyne's (Management) Limited (Registered number: SC231973)

Notes to the Financial Statements
for the Year Ended 31 July 2023

1. STATUTORY INFORMATION

Cheyne's (Management) Limited is a private company, limited by shares , registered in Scotland. The company's registered number and registered office address can be found on the Company Information page.

2. ACCOUNTING POLICIES

Basis of preparing the financial statements
These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

Significant judgements and estimates
Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

There are not considered to be any critical judgements in applying the company's accounting policies.

The company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amounts of assets or liabilities within the next financial year are addressed below.

(i) Goodwill valuation

The valuation of goodwill involves a number of estimates including future profitability and considered of any factors which may lead to an impairment.

Turnover
Revenue is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

Turnover is the amount derived from ordinary activities and is measured at fair value of the consideration received or receivable. Revenue is reduced for estimated customer returns, rebates and other similar allowances, and is stated net of VAT.

Revenue from the provision of services as specified in the strategic report is recognised when all the following conditions are satisfied:

- The amount of revenue can be measures reliably;
- It is probable that the economic benefits associated with the transaction will flow to the company; and
- The costs incurred or to be incurred in respect of the transactions can be measured reliably.

Goodwill
Positive goodwill is capitalised, classified as an asset on the balance sheet and amortised over its useful life.

The company had previously departed from the requirements of Companies Act 2006 to amortise goodwill. The directors have reconsidered this treatment in the current year and have decided to amortise the net book value over the coming 10 years.

Tangible fixed assets
Depreciation is provided at the following annual rates in order to write off the cost less estimated residual value of each asset over its estimated useful life.
Short leasehold improvements - Over the remaining life of the lease
Fixtures and fittings - 15% on cost and Straight line over 5 years

Tangible assets are stated at cost less accumulated depreciation and accumulated impairment losses. Cost includes the original purchase price and costs directly attributable to bringing the asset to its working condition for its intended use.

Cheyne's (Management) Limited (Registered number: SC231973)

Notes to the Financial Statements - continued
for the Year Ended 31 July 2023

2. ACCOUNTING POLICIES - continued

Stocks
Inventories are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.

Financial instruments
The company has chosen to adopt Sections 11 and 12 of FRS in respect of financial instruments.

(i) Financial assets

Trade and other debtors that are receivable within one year and do not constitute a financing transaction are recorded at the undiscounted amount expected to be received, net of impairment. Those that are receivable after more than one year or that constitute a financing transaction are recorded initially at fair value less transaction costs and subsequently at amortised cost, net of impairment.

Cash and cash equivalents comprise cash at bank and in hand, demand deposits with banks and bank overdrafts. In the statement of financial position, bank overdrafts are shown within borrowings or current liabilities.

(ii) Financial liabilities

Basic financial liabilities, including trade creditors and other creditors, bank loans, loans from fellow group companies 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 receipts discounted at a market rate of interest.

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. Accounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities.

Taxation
Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the statement of financial position date.

Deferred tax
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Pension costs and other post-retirement benefits
The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate.

Cheyne's (Management) Limited (Registered number: SC231973)

Notes to the Financial Statements - continued
for the Year Ended 31 July 2023

2. ACCOUNTING POLICIES - continued

Employee benefits
Short term employee benefits, including holiday pay, are recognised as an expense in the statement of income and retained earnings in the period in which they are incurred.

Provisions
Provisions are recognised when the company has a present legal or constructive obligation as a result of a past event, it is probable that an outflow of economic benefits will be required to settle the obligation and a reliable estimate can be made. Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation. The increase in the provision due to passage of time is recognised as an interest expense.

Interest bearing borrowings

Interest-bearing borrowings are recognised initially at fair value less attributable transaction costs. Subsequent to initial recognition, interest-bearing borrowings are stated at amortised cost with any difference being between the amount initially recognised and redemption value being recognised in the statement of comprehensive income over the the period of the borrowings, together with any interest and fees payable, using the effective interest method.

Related parties

For the purposes of these financial statements, a party is considered to be related to the company if:

(i) the party has the ability, directly or indirectly, through one or more intermediaries, to control the company or exercise significant influence over the company in making financial and operating policy decisions, or has joint control over the operating company;
(ii) the company and the party are subject to common control;
(iii) the party is an associate of the company or a joint venture in which the company is a venturer;
(iv) the party is a member of key management personnel of the company or company's parent, or a close family member of such an individual, or is an entity under the control, joint control or significant influence or such individuals;
(v) the party is a close family member of a party referred to in (i) or is an entity under common control, joint control or significant influence of such individuals;
(vi) the party is a post-employment benefit plan which is for the benefit of employees of the company or of any entity that is a related party of the company; or
(vii) the party, or any member of a group of which is a part, provides key management personnel services to the company or is a parent.

Close family members of an individual are those family members who may be expected to influence, or be influenced by, that individual in their dealings with the entity.

Cheyne's (Management) Limited (Registered number: SC231973)

Notes to the Financial Statements - continued
for the Year Ended 31 July 2023

2. ACCOUNTING POLICIES - continued

Leased assets
Assets that are held by the company under leases which transfer to the company substantially all the risks and rewards of ownership are classified as being held under finance leases. Leases which do not transfer substantially all the risks and rewards of ownership to the company are classified as operating leases.

Assets held under finance leases are initially recognised as assets of the company at their fair value at the inception of the lease or, if lower, at the present value of the minimum lease payments. The corresponding liability to the lessor is included in the statement of financial position as a finance lease obligation. Lease payments are apportioned between finance expenses and reduction of the lease obligation so as to achieve a constant rate of interest on the remaining balance of the liability. Finance expenses are recognised immediately in profit or loss, unless they are directly attributable to qualifying assets, in which case they are capitalised in accordance with the company's policy on borrowing costs (see the accounting policy above). Contingent rentals are recognised as expenses in the period in which they are incurred.

Operating lease payments are recognised as an expense on a straight-line basis over the lease term, except where another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

In the event that lease incentives are received to enter into operating leases, such incentives are recognised as a liability. The aggregate benefit of incentives is recognised as a reduction of rental expense on a straight-line basis, except where another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

3. REVENUE

The revenue and loss (2022 - profit) before taxation are attributable to the one principal activity of the company.

An analysis of revenue by class of business is given below:

31/7/23 31/7/22
£    £   
Salon 2,490,544 2,597,051
Retail 113,320 114,416
Training 1,228,001 1,394,823
3,831,865 4,106,290

4. EMPLOYEES AND DIRECTORS
31/7/23 31/7/22
£    £   
Wages and salaries 1,755,808 1,856,789
Social security costs 148,946 154,070
Other pension costs 30,253 31,161
1,935,007 2,042,020

The average number of employees during the year was as follows:
31/7/23 31/7/22

Administration and support 3 11
Sales, marketing and distribution 68 58
71 69

Cheyne's (Management) Limited (Registered number: SC231973)

Notes to the Financial Statements - continued
for the Year Ended 31 July 2023

4. EMPLOYEES AND DIRECTORS - continued

31/7/23 31/7/22
£    £   
Directors' remuneration 203,229 219,492
Directors' pension contributions to money purchase schemes 2,356 831

Information regarding the highest paid director is as follows:
31/7/23 31/7/22
£    £   
Emoluments etc 90,111 90,400
Pension contributions to money purchase schemes 102 -

5. OPERATING (LOSS)/PROFIT

The operating loss (2022 - operating profit) is stated after charging:

31/7/23 31/7/22
£    £   
Depreciation - owned assets 45,727 54,003
Loss on disposal of fixed assets 18,376 -
Goodwill amortisation 430,000 -
Auditors' remuneration 10,160 9,740
Operating lease charges 126,500 126,500

6. INTEREST PAYABLE AND SIMILAR EXPENSES
31/7/23 31/7/22
£    £   
Bank loan interest 13,821 12,530
Other loan interest - 1,656
13,821 14,186

7. TAXATION

Analysis of the tax (credit)/charge
The tax (credit)/charge on the loss for the year was as follows:
31/7/23 31/7/22
£    £   
Current tax:
UK corporation tax (7,631 ) 44,003

Deferred tax (22,000 ) (2,413 )
Tax on (loss)/profit (29,631 ) 41,590

UK corporation tax was charged at 19%) in 2022.

Cheyne's (Management) Limited (Registered number: SC231973)

Notes to the Financial Statements - continued
for the Year Ended 31 July 2023

7. TAXATION - continued

Reconciliation of total tax (credit)/charge included in profit and loss
The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below:

31/7/23 31/7/22
£    £   
(Loss)/profit before tax (524,570 ) 196,822
(Loss)/profit multiplied by the standard rate of corporation tax in the UK of
19% (2022 - 19%)

(99,668

)

37,396

Effects of:
Expenses not deductible for tax purposes 14 143
Depreciation in excess of capital allowances 92,624 6,464
Adjustments to tax charge in respect of previous periods (482 ) -
Deferred taxation (22,000 ) (2,413 )
Expenses allowable (119 ) -
Total tax (credit)/charge (29,631 ) 41,590

8. INTANGIBLE FIXED ASSETS
Goodwill
£   
COST
At 1 August 2022
and 31 July 2023 8,689,000
AMORTISATION
At 1 August 2022 4,389,000
Amortisation for year 430,000
At 31 July 2023 4,819,000
NET BOOK VALUE
At 31 July 2023 3,870,000
At 31 July 2022 4,300,000

Cheyne's (Management) Limited (Registered number: SC231973)

Notes to the Financial Statements - continued
for the Year Ended 31 July 2023

9. PROPERTY, PLANT AND EQUIPMENT
Short Fixtures
leasehold and
improvements fittings Totals
£    £    £   
COST
At 1 August 2022 427,252 918,560 1,345,812
Additions - 1,666 1,666
Disposals (135,806 ) (482,178 ) (617,984 )
At 31 July 2023 291,446 438,048 729,494
DEPRECIATION
At 1 August 2022 366,360 843,923 1,210,283
Charge for year 16,633 29,094 45,727
Eliminated on disposal (129,728 ) (469,880 ) (599,608 )
At 31 July 2023 253,265 403,137 656,402
NET BOOK VALUE
At 31 July 2023 38,181 34,911 73,092
At 31 July 2022 60,892 74,637 135,529

10. INVENTORIES
31/7/23 31/7/22
£    £   
Stocks 46,349 51,773

11. DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
31/7/23 31/7/22
£    £   
Trade debtors 90,025 134,959
Other debtors 347,125 300,587
Tax 7,148 -
Prepayments and accrued income 54,803 81,388
499,101 516,934

12. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
31/7/23 31/7/22
£    £   
Bank loans and overdrafts (see note 14) 134,037 131,415
Trade creditors 202,559 204,845
Tax - 44,003
Social security and other taxes 38,059 47,961
VAT 120,868 121,394
Other creditors 65,854 10,797
Accruals and deferred income 159,502 149,972
720,879 710,387

Cheyne's (Management) Limited (Registered number: SC231973)

Notes to the Financial Statements - continued
for the Year Ended 31 July 2023

13. CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE
YEAR
31/7/23 31/7/22
£    £   
Bank loans (see note 14) 123,313 257,350

14. LOANS

An analysis of the maturity of loans is given below:

31/7/23 31/7/22
£    £   
Amounts falling due within one year or on demand:
Bank loans 134,037 131,415

Amounts falling due between one and two years:
Bank loans - 1-2 years 85,813 134,037

Amounts falling due between two and five years:
Bank loans - 2-5 years 37,500 123,313

15. LEASING AGREEMENTS

Minimum lease payments under non-cancellable operating leases fall due as follows:
31/7/23 31/7/22
£    £   
Within one year 126,500 152,750
Between one and five years 506,000 506,000
In more than five years 453,000 579,500
1,085,500 1,238,250

16. SECURED DEBTS

The following secured debts are included within creditors:

31/7/23 31/7/22
£    £   
Bank loans 257,350 388,765

The bank loan is secured by way of floating charge over the assets of the company.

17. PROVISIONS FOR LIABILITIES
31/7/23 31/7/22
£    £   
Deferred tax
Accelerated capital allowances 1,500 23,500

Cheyne's (Management) Limited (Registered number: SC231973)

Notes to the Financial Statements - continued
for the Year Ended 31 July 2023

17. PROVISIONS FOR LIABILITIES - continued

Deferred
tax
£   
Balance at 1 August 2022 23,500
Credit to Income Statement during year (22,000 )
Balance at 31 July 2023 1,500

18. CALLED UP SHARE CAPITAL

Allotted, issued and fully paid:
Number: Class: Nominal 31/7/23 31/7/22
value: £    £   
1,000 Ordinary 1 1,000 1,000

19. PENSION COMMITMENTS

The company operates defined contribution pension schemes. The pension cost charge for the year represents contributions payable by the company to the schemes and amounted to £30,252 (2022 - £31,160). Contributions totalling £6,095 (2022 - £6,019) were payable to the schemes at the year end and are included in creditors.

20. NAME OF PARENT OF GROUP

These financial statement are consolidated in the financial statements of Cheynes Management Holdings Ltd. The registered office of Cheynes Management Holdings Ltd is 46 George Street, Edinburgh, EH2 2LE

21. RELATED PARTY DISCLOSURES

Key management personnel of the entity or its parent (in the aggregate)
31/7/23 31/7/22
£    £   
Amount due to related party 10,000 -

During the year, a total of key management personnel compensation of £ 100,983 was paid.

22. POST BALANCE SHEET EVENTS

Since the year end the directors have taken the decision to separate the training division from the company.