The directors present the strategic report for the year ended 30 April 2023.
The directors are pleased with the group performance in the year. The group continues with its core activities of waste management, recycling and management of its commercial property portfolio.
Continual changes in regulation provide the group with ongoing challenges but also opportunities, with new legislation coming into effect requiring all businesses in Wales to separate their waste for recycling being seen as a growth opportunity for the group.
The group continues to engage with potential suppliers for Energy from Waste plant, and is closely monitoring progress in innovative pilot plants to improve small scale Energy from Waste processes.
The group has achieved contract extensions for public sector recycling facilities and continues to invest in operational efficiencies and to expand with product and service diversification.
The group operates within the waste management industry which is subject to strict environmental and health and safety legislation. The group’s management develop systems and policies to ensure compliance with all relevant regulations and to continue to meet these standards which are subject to continuous revision.
The group operations involve both public sector contracts and services to both industrial and commercial customers. Public service contracts may be subject to periodic competitive tender and the group’s management has put in place a tender approval procedure to ensure all risks are properly considered.
The group’s management recognise the liquidity risk to the group and utilise short and long term cash flow projections to review this, and are confident that they have sufficient banking and financing facilities in place to meet the group’s working capital requirement and sufficient funds are available for existing operations and planned expansions.
Social responsibility
The group’s vision is to build a safe and sustainable future. The business continually seeks to reduce its environmental impact and to make a positive contribution to the communities in which it operates.
The group is committed to investing in systems and technologies that will support its environmental objectives, with sustainable waste management and recycling initiatives at the heart of all that is done.
The group’s strong community focus means it seeks to invest back into the local area, and the group is dedicated to providing a healthy and safe working environment for all its staff and provide an exceptional level of service to all of its customers.
Sale of subsidiary
During the year the group disposed of its wholly owned subsidiary Potters (Midlands) Ltd following a strategic review of the group’s current and future operations. The sale has enabled key staff to focus on future opportunities and projects within the planned diversification opportunities for the group.
Future
The group is proud of its continued achievements in a difficult economical climate, and plans to continue to grow and diversify within and outside the waste management industry. In doing so it will retain a focus on its social and environmental responsibilities.
Throughout all the group’s operations, a strong focus on sustainability and innovation is maintained, sourcing technologies and embracing best practice which helps us reduce our impact on the environment and benefit the local communities that it operates in, working to build a brighter tomorrow for future generations.
On behalf of the board
The directors present their annual report and financial statements for the year ended 30 April 2023.
The results for the year are set out on page 8.
No ordinary dividends were paid. The directors do not recommend payment of a further dividend.
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
In accordance with the company's articles, a resolution proposing that Xeinadin Audit Limited be reappointed as auditor of the group will be put at a General Meeting.
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
We have audited the financial statements of Potter's Waste Management Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 30 April 2023 which comprise the group profit and loss account, the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
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 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:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
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:
adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent company 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.
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.
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.
Enquiries of management and those charged with governance were held in order to identify any laws and regulations that could be expected to have a material impact on the financial statements. Throughout the audit, the team were updated with the outcomes of these enquiries including consideration as to where and how fraud may occur in the group.
The audit procedures undertaken to address any potential risk in relation to irregularities (which include fraud and non-compliance with laws and regulations) included: enquiries of management and those charged with governance on how the group complies with relevant laws, regulations and any cases of actual or potential litigation or claims; examination of appropriate legal correspondence; testing of journal entries for appropriateness; and analytical procedures on account balances to identify variances against expectation which may show indications of fraud.
No instances of material non-compliance were identified, although the prospect of detecting irregularities, including fraud, is inherently difficult. This is due to; difficulty in detecting irregularities; limits imposed by the effectiveness of the groups’s controls; and the nature, timing and extent of the audit procedures performed. Irregularities as a result of fraud are inherently more difficult to detect than those that resulting from error. Despite the audit being planned and performed in accordance with ISAs (UK), there is an unavoidable risk that material misstatements may not be detected.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
Use of our report
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
These financial statements have been prepared in accordance with the provisions relating to medium-sized groups.
As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £8,938,751 (2022 - £16,324,304 profit).
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.
Potter's Waste Management Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Potter House, Henfaes Lane, Welshpool, Powys, SY21 7BE.
The group consists of Potter's Waste Management Limited and all of its subsidiaries.
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 freehold properties and to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.
The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The consolidated group financial statements consist of the financial statements of the parent company Potter's Waste Management Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.
All financial statements are made up to 30 April 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.
Where a subsidiary is fully disposed of, the gain or loss on the disposal reflects the consideration proceeds net of the assets eliminated from the group, any goodwill at the disposal date and associated professional costs . The trading results of the entity are included up to the date of disposal with any group trading activity in the period of ownership eliminated up to the disposal date.
At the time of approving the financial statements, the directors have a reasonable expectation that the group 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.
Turnover is recognised to the extent that it is probable that the economic benefits will flow to the company, and the revenue can be reliably measured once the goods or services are provided to the customer. Income from waste disposal is recognised at the point of disposal. Income from landfill activities include landfill tax at the prevailing rate. Turnover is measured at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes with the exception of landfill tax.
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.
Certain capital additions and disposals have been accounted for on a component basis where appropriate.
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.
At each reporting period end date, the group reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.
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, 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, 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.
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.
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.
Basic financial liabilities, 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.
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.
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.
The tax expense represents the sum of the tax currently payable and deferred 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 liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
Provisions are in place for environmental and landfill costs, these include provisions associated with the closure and post closure of the landfill site. The company estimates its total future requirements for closure costs and post closure monitoring and maintenance of the site after the anticipated closure.
A provision is made for the final capping, inspection, monitoring, operating and maintenance costs to be incurred during the period after which the site closes.
Post closure provisions have been shown at net present value. The current cost estimate has been inflated for the current year at 7.8% (2022: 4.1%) and discounted by 7.75% (2022: 7.25%). The unwinding of the discount element is shown in the financial statements as a financial item.
The group provides for full closure costs as the voidspace is used. In accordance with FRS 102 Section 21, full provision has been made for the company's minimum unavoidable costs.
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.
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.
In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.
Provisions are in place for environmental and landfill costs, these include provisions associated with the closure and post closure of the landfill site. The group estimates its total future requirements for closure costs and post closure monitoring and maintenance of the site after the anticipated closure. Actual costs, interest rates and capacity can vary.
The group depreciates tangible assets over their estimated useful lives based on void space filled and historic performance. The actual lives can vary based on filling capacity and utilisation of assets.
The group records its investment property at fair value as arrived at by independent valuers based on similar properties in the area. Actual values may vary.
All turnover arose within the United Kingdom.
The average monthly number of persons (including directors) employed by the group and company during the year was:
Their aggregate remuneration comprised:
Key management personnel are the directors of the company and the directors of the subsidiaries with a combined remuneration of £104,598 (2022: £105,604).
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:
In addition to the amount charged to the profit and loss account, the following amounts relating to tax have been recognised directly in other comprehensive income:
Impairment tests have been carried out where appropriate and the following impairment losses have been recognised in profit or loss:
The impairment losses in respect of other tangible fixed assets are recognised in other gains and losses in the profit and loss account. These have been arrived at based on valuations provided by an independent third party valuer.
Reversals of previous impairment losses have been recognised in profit or loss as follows:
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
More information on impairment movements in the year is given in note 11.
Land and buildings owned by Sundorne Products (Llanidloes) Limited were revalued in November 2011 by independent valuers GVA Grimley Limited, Chartered Surveyors, who conducted a valuation on an open market value basis of vacant possession and available void space. The valuation conformed to International Valuation Standards and was based on recent market transactions on arm’s length terms for similar properties.
In May 2022, the directors re-evaluated the void available for viable economic utilisation, and based on the above valuation adjusted the carrying value of the land and buildings to reflect this, with an adjustment of £2,417,759 being made to the carrying value of the land and a corresponding adjustment made in the revaluation reserve (net of deferred taxation).
The revaluation surplus is disclosed in note 27.
Had the freehold land and buildings not been revalued, the historic cost of these assets would have been £841,350.
The fair value of the investment property has been arrived at on the basis of a valuation carried out by Towler Shaw Roberts, Chartered Surveyors, who are not connected with the company. The valuation was made on an open market value basis on 30 April 2022 by reference to market evidence of transaction prices for similar properties. The historical cost of the properties is £2,383,388.
The directors have decided that the valuation carried out at 30 April 2022 remains appropriate for the investment property as at 30 April 2023.
Details of the company's subsidiaries at 30 April 2023 are as follows:
On 28th April 2023 the company disposed of its 100% direct interest in Potters (Midlands) Limited.
The investments in subsidiaries are all stated at cost.
As permitted by the reduced disclosure framework within FRS 102, the company has taken advantage of the exemption from disclosing the carrying amount of certain classes of financial instruments, denoted by 'n/a' above.
The above borrowings have the associated securities:
Potter's Waste Management Limited
The long-term loans are secured by mortgage debentures with HSBC Bank plc by means of fixed and floating charges. These loans have a composite company unlimited multilateral guarantee against all assets of the group and all assets of the entities that comprise it.
Sundorne Products (Llanidloes) Limited
Included within borrowings are bank loans from Handelsbanken plc and Close Brothers Limited. These loans are secured by way of legal charge and composite company unlimited multilateral guarantee against the assets to which they relate. Further details of each charge can be obtained from Companies House.
Finance lease payments represent rentals payable by the company or group for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 3 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
The total interest charge incurred by the group for assets held under finance lease for the year ended 30 April 2023 was £84,521 (2022: £164,857).
Provision has been made for the capping, closure and post closure costs in relation to the landfill site restoration and maintenance in accordance with the accounting policy set out in note 1.15. The company expects these costs to be incurred over the next 44 years for Sundorne Products (Llanidloes) Limited.
The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:
The deferred tax liability set out above is not expected to reverse completely within the next 12 months and relates to accelerated capital allowances and the revaluation of fixed assets.
A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund. At 30 April 2023 the group had a liability of £nil (2022: £3,345) due to the pension fund.
On 28 April 2023 the group disposed of its 100% holding in Potters (Midlands) Limited. Included in these financial statements are profits before tax of £319,154 arising from the company's interests in Potters (Midlands) Limited up to the date of its disposal. Upon disposal the group recognised a gain of £7,321,840.
No interest is charged on balances between group companies.
During the year, the group advanced £213,707 (2022: £386,505) to Mr J Potter. Mr J Potter made repayments of £1,624,725 (2022: £398,065 ). At the year end the group owed Mr J Potter £1,323,527 (2022 was owed by Mr J Potter: £87,493).
In addition to the above, the group made sales to Mr J Potter totalling £179,234 and had purchases of £87,320. At 30 April 2023 the associated debtors totalled £161,159 (2022: £128,315) and creditors totalled £44,035 (2022: £25,670).
The prior year adjustment is in relation to the amendment of the revaluation reserve for the landfill site at Sundorne Products (Llanidloes) Limited.