Company registration number NI022447 (Northern Ireland)
BEFAB LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
BEFAB LIMITED
COMPANY INFORMATION
Directors
Mr W Roberts
Mr M Elliott
Secretary
Mr W Roberts
Company number
NI022447
Registered office
At the office of Moore Braniff
2 Beechill Business Park
96 Beechill Road
Belfast
Northern Ireland
BT8 7QN
Auditor
SLMD Limited T/a Bridge, Chartered Accountants
Unit G, Forestview Office Park
Purdy's Lane
Belfast
BT8 7AR
Business address
Unit 17 La Mon Estates
149 Glen Road
Comber
Co. Down
Northern Ireland
BT23 5QU
Bankers
Ulster Bank
11 - 16 Donegall Square East
Belfast
BT1 5UB
BEFAB LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2
Independent auditor's report
3 - 5
Profit and loss account
6
Statement of comprehensive income
7
Balance sheet
8
Statement of changes in equity
9
Statement of cash flows
10
Notes to the financial statements
11 - 23
BEFAB LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 1 -
The directors present the strategic report for the year ended 31 March 2023.
Review of the business
The directors aim to present a balanced and comprehensive review of the development and performance during the year and its position at 31 March 2023. The directors' review is consistent with the size and nature of the business and is written in the context of the risks and uncertainties the company faces.
The directors consider the key performance indicators are those that communicate the financial performance and strength of the company, with these being turnover, gross profit, operating profit and net assets.
The results for the year have seen turnover decrease by 13% from £13.5m in 2022 to £11.8m in 2023, generating a gross profit of £1.89m (2022 - £2.53m) at a gross profit margin of 16.07% (2022- 18.73%). Operating profit for the year reduced from £1,883,054 in 2022 to in £1,148,638 in 2023. The directors are satisfied with the results, given the challenges faced in the year, with rising fuel cots, raising steel prices and other inflationary pressures experienced.
The company has no borrowings other than obligations under finance leases and continues to have a strong cashflow and strong net asset position of £5,410,660 (2022- £4,711,739).
Principal risks and uncertainties
The directors consider the principal risks and uncertainties facing the group are:-
Economic Risk
The impact of
The directors work closely with suppliers, customers and advisors to carefully manage these risks.
Competition Risk
Competition risk is managed through close attention to customer service, continued investment in equipment and the provision of quality services.
Foreign Exchange Risk
As the company operates within the the island of Ireland it is susceptible to movements in foreign currency rates primarily regarding the Euro. The company manages foreign exchange risk by continuing to work closely with the company's foreign exchange advisers.
Other information and explanations
Future developments
The directors are committed to continued capital investment and customer service focus, to ensure they remain at the forefront of supplying steel in UK and Ireland.
Mr W Roberts
Secretary
13 February 2024
BEFAB LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 2 -
The directors present their annual report and financial statements for the year ended 31 March 2023.
Principal activities
The principal activity of the company continued to be that of fabrication of metal, together with the wholesale retail of steel and associated products. In addition to the main site at the business address, the company also operates a sales office based in Dundalk in the Republic of Ireland.
Results and dividends
The results for the year are set out on page 6.
Ordinary dividends were paid amounting to £260,000. 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:
Mr W Roberts
Mr M Elliott
Statement of directors' responsibilities
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the 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 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 company’s auditor 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 company’s auditor is aware of that information.
By order of the board
Mr W Roberts
Secretary
13 February 2024
BEFAB LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF BEFAB LIMITED
- 3 -
Opinion
We have audited the financial statements of Befab Limited (the 'company') for the year ended 31 March 2023 which comprise the profit and loss account, the statement of comprehensive income, the balance sheet, the statement of changes in equity, the 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:
give a true and fair view of the state of the company's affairs as at 31 March 2023 and of its profit 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.
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 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.
The directors are responsible for the other information contained within the annual report. The other information comprises the information included in the annual report other than the financial statements and our auditor's report 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 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 or a material misstatement of the other information. 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 directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the directors' report has been prepared in accordance with applicable legal requirements.
BEFAB LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF BEFAB LIMITED
- 4 -
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 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, 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 remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
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 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.
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:
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:
we identified the laws and regulations applicable to the company through discussions with directors and other management, and from our commercial knowledge and experience of the computer component manufacturing and supply sector;
we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including but not limited to; Companies Act 2006, taxation legislation, data protection, anti-bribery, employment, environmental and health and safety legislation;
we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and
identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.
BEFAB LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF BEFAB LIMITED
- 5 -
We assessed the susceptibility of the company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:
considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations; and
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;
investigated the rationale behind significant or unusual transactions; and
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:
agreeing financial statement disclosures to underlying supporting documentation;
enquiring of management as to actual and potential litigation and claims;
reviewing correspondence with HMRC and the company’s legal advisors.
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.
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.
Other matters which we are required to address
In accordance with ISA 710 Comparative Information – Corresponding Figures and Comparative Financial Statements, the comparative financial statements were not audited. However, we have performed sufficient audit testing in the comparative balances and are satisfied that there is no material misstatement within the comparative financial statements.
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.
Mr Seamus Dawson (Senior Statutory Auditor)
13 February 2024
For and on behalf of
SLMD Limited T/a Bridge, Chartered Accountants
Unit G, Forestview Office Park
Purdy's Lane
Belfast
BT8 7AR
BEFAB LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 MARCH 2023
- 6 -
2023
2022
Notes
£
£
Turnover
3
11,793,385
13,544,100
Cost of sales
(9,897,619)
(11,007,203)
Gross profit
1,895,766
2,536,897
Distribution costs
(270,507)
(258,022)
Administrative expenses
(476,621)
(450,050)
Other operating income
54,229
Operating profit
4
1,148,638
1,883,054
Interest receivable and similar income
7
38,402
172
Interest payable and similar expenses
8
(4,115)
(3,043)
Profit before taxation
1,182,925
1,880,183
Tax on profit
9
(224,004)
(350,452)
Profit for the financial year
958,921
1,529,731
The profit and loss account has been prepared on the basis that all operations are continuing operations.
BEFAB LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2023
- 7 -
2023
2022
£
£
Profit for the year
958,921
1,529,731
Other comprehensive income
-
-
Total comprehensive income for the year
958,921
1,529,731
BEFAB LIMITED
BALANCE SHEET
AS AT 31 MARCH 2023
31 March 2023
- 8 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
11
185,494
186,907
Investments
12
335,580
300,000
521,074
486,907
Current assets
Stocks
13
4,724,202
3,174,465
Debtors
14
1,772,366
2,209,459
Cash at bank and in hand
1,345,131
2,405,861
7,841,699
7,789,785
Creditors: amounts falling due within one year
15
(2,924,203)
(3,532,752)
Net current assets
4,917,496
4,257,033
Total assets less current liabilities
5,438,570
4,743,940
Provisions for liabilities
Deferred tax liability
17
27,910
32,201
(27,910)
(32,201)
Net assets
5,410,660
4,711,739
Capital and reserves
Called up share capital
19
50
50
Share premium account
119,976
119,976
Capital redemption reserve
74
74
Profit and loss reserves
5,290,560
4,591,639
Total equity
5,410,660
4,711,739
The financial statements were approved by the board of directors and authorised for issue on 13 February 2024 and are signed on its behalf by:
Mr M Elliott
Director
Company Registration No. NI022447
BEFAB LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
- 9 -
Share capital
Share premium account
Capital redemption reserve
Profit and loss reserves
Total
Notes
£
£
£
£
£
Balance at 1 April 2021
50
119,976
74
3,476,908
3,597,008
Year ended 31 March 2022:
Profit and total comprehensive income for the year
-
-
-
1,529,731
1,529,731
Dividends
10
-
-
-
(415,000)
(415,000)
Balance at 31 March 2022
50
119,976
74
4,591,639
4,711,739
Year ended 31 March 2023:
Profit and total comprehensive income for the year
-
-
-
958,921
958,921
Dividends
10
-
-
-
(260,000)
(260,000)
Balance at 31 March 2023
50
119,976
74
5,290,560
5,410,660
BEFAB LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2023
- 10 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash (absorbed by)/generated from operations
22
(381,807)
760,777
Interest paid
(4,115)
(3,043)
Income taxes paid
(341,778)
(185,561)
Net cash (outflow)/inflow from operating activities
(727,700)
572,173
Investing activities
Purchase of tangible fixed assets
(61,803)
(161,488)
Proceeds from disposal of tangible fixed assets
(1,509)
17,280
Proceeds from disposal of investments
(35,580)
(100,000)
Interest received
822
172
Other income received from investments
37,580
Net cash used in investing activities
(60,490)
(244,036)
Financing activities
Payment of finance leases obligations
(12,540)
(25,889)
Dividends paid
(260,000)
(415,000)
Net cash used in financing activities
(272,540)
(440,889)
Net decrease in cash and cash equivalents
(1,060,730)
(112,752)
Cash and cash equivalents at beginning of year
2,405,861
2,518,613
Cash and cash equivalents at end of year
1,345,131
2,405,861
BEFAB LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
- 11 -
1
Accounting policies
Company information
Befab Limited is a private company limited by shares incorporated in Northern Ireland. The registered office is At the office of Moore Braniff, 2 Beechill Business Park, 96 Beechill Road, Belfast, Northern Ireland, BT8 7QN.
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 freehold properties and to include investment properties and certain financial instruments at fair value]. The principal accounting policies adopted are set out below.
1.2
Going concern
Atruet 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.
1.3
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.
1.4
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Plant and machinery
Straight line over five or ten years
Fixtures, fittings & equipment
20% straight line
Motor vehicles
25% reducing balance
BEFAB LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 12 -
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.5
Impairment of fixed assets
At each reporting period end date, the company 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.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.6
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.
Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
1.7
Cash at bank and in hand
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
BEFAB LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 13 -
1.8
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
Impairment of financial assets
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
BEFAB LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 14 -
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.
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.9
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recognised in profit or loss immediately, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.
1.10
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 company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
BEFAB LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 15 -
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has 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.
1.11
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.12
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.13
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
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 leases asset are consumed.
1.14
Government grants
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.
BEFAB LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 16 -
1.15
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
Judgements and key sources of estimation uncertainty
In the application of the company’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.
3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by geographical market
Northern Ireland
8,634,169
9,051,380
Republic of Ireland
3,159,216
4,492,720
11,793,385
13,544,100
2023
2022
£
£
Other revenue
Interest income
38,402
172
Grants received
39,644
4
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange (gains)/losses
(23,776)
2,737
Government grants
(39,644)
Fees payable to the company's auditor for the audit of the company's financial statements
Depreciation of owned tangible fixed assets
63,216
95,017
Loss/(profit) on disposal of tangible fixed assets
1,509
(3,033)
Operating lease charges
55,640
64,372
BEFAB LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 17 -
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
30
30
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
780,212
791,389
Social security costs
66,684
73,443
Pension costs
17,482
16,985
864,378
881,817
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
80,284
82,354
Company pension contributions to defined contribution schemes
3,691
3,601
83,975
85,955
The number of directors for whom retirement benefits are accruing under defined benefit schemes amounted to 1 (2022 - 1).
7
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
822
172
Other income from investments
Gains on financial instruments measured at fair value through profit or loss
37,580
Total income
38,402
172
2023
2022
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
822
172
Interest on financial assets measured at fair value through profit or loss
37,580
BEFAB LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 18 -
8
Interest payable and similar expenses
2023
2022
£
£
Other finance costs:
Interest on finance leases and hire purchase contracts
1,393
3,043
Other interest
2,722
4,115
3,043
9
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
228,295
342,178
Deferred tax
Origination and reversal of timing differences
(4,291)
8,274
Total tax charge
224,004
350,452
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
1,182,925
1,880,183
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2022: 19.00%)
224,756
357,235
Tax effect of expenses that are not deductible in determining taxable profit
339
708
Tax effect of income not taxable in determining taxable profit
(2,850)
Permanent capital allowances in excess of depreciation
(9,097)
(30,968)
Depreciation on assets not qualifying for tax allowances
12,297
18,053
Other non-reversing timing differences
(4,291)
8,274
Taxation charge for the year
224,004
350,452
10
Dividends
2023
2022
£
£
Interim paid
260,000
415,000
BEFAB LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 19 -
11
Tangible fixed assets
Plant and machinery
Fixtures, fittings & equipment
Motor vehicles
Total
£
£
£
£
Cost
At 1 April 2022
942,222
98,507
227,578
1,268,307
Additions
9,303
24,500
28,000
61,803
At 31 March 2023
951,525
123,007
255,578
1,330,110
Depreciation and impairment
At 1 April 2022
862,479
90,446
128,475
1,081,400
Depreciation charged in the year
24,305
7,136
31,775
63,216
At 31 March 2023
886,784
97,582
160,250
1,144,616
Carrying amount
At 31 March 2023
64,741
25,425
95,328
185,494
At 31 March 2022
79,743
8,061
99,103
186,907
12
Fixed asset investments
2023
2022
£
£
Unlisted investments
335,580
300,000
Movements in fixed asset investments
Investments
£
Cost or valuation
At 1 April 2022
300,000
Valuation changes
37,580
Disposals
(2,000)
At 31 March 2023
335,580
Carrying amount
At 31 March 2023
335,580
At 31 March 2022
300,000
13
Stocks
2023
2022
£
£
Raw materials and consumables
4,724,202
3,174,465
BEFAB LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 20 -
14
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
1,678,945
1,914,098
Other debtors
88,166
202,002
Prepayments and accrued income
5,255
93,359
1,772,366
2,209,459
15
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Obligations under finance leases
16
12,540
Trade creditors
2,525,372
3,052,367
Corporation tax
228,700
342,183
Other taxation and social security
28,298
18,408
Other creditors
117,652
11,685
Accruals and deferred income
24,181
95,569
2,924,203
3,532,752
16
Finance lease obligations
2023
2022
Future minimum lease payments due under finance leases:
£
£
Within one year
12,540
Finance lease payments represent rentals payable by the company for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 4 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
17
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2023
2022
Balances:
£
£
Accelerated capital allowances
27,910
32,201
BEFAB LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
17
Deferred taxation
(Continued)
- 21 -
2023
Movements in the year:
£
Liability at 1 April 2022
32,201
Credit to profit or loss
(4,291)
Liability at 31 March 2023
27,910
The deferred tax liability set out above is expected to reverse within [12 months] and relates to accelerated capital allowances that are expected to mature within the same period.
18
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
17,482
16,985
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
19
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary Shares of £1 each
50
50
50
50
20
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2023
2022
£
£
Within one year
439
3,051
Between two and five years
1,535
1,974
3,051
BEFAB LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 22 -
21
Related party transactions
Remuneration of key management personnel
The remuneration of key management personnel (including directors) is as follows.
2023
2022
£
£
Aggregate compensation
221,973
228,041
Transactions with related parties
During the year the company entered into the following transactions with the following related parties of which Mr M D Elliott is a director or shareholders or partner in.
Sales
Sales
Purchases
Purchases
2023
2022
2023
2022
£
£
£
£
La Mon estates
916
-
-
-
La Mon contracts Ltd
-
-
41,001
30,855
Elite Garage Doors (N.I.) Ltd
70,836
66,060
-
9,000
The company also paid rent of £48,000 (2022 £48,000) to LaMon Estates which Mr D Elliot has an interest in.
The following amounts were outstanding at the reporting end date:
2023
2022
Amounts due from related parties
£
£
La Mon estates
1,098
1,320
Sales of goods to related parties were made at the company's usual list price. Purchases were made at market price.
The amounts outstanding are unsecured and will be settled in cash within normal business terms.
No bad debts have been incurred or in either year.
BEFAB LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 23 -
22
Cash (absorbed by)/generated from operations
2023
2022
£
£
Profit for the year after tax
958,921
1,529,731
Adjustments for:
Taxation charged
224,004
350,452
Finance costs
4,115
3,043
Investment income
(38,402)
(172)
Loss/(gain) on disposal of tangible fixed assets
1,509
(3,033)
Depreciation and impairment of tangible fixed assets
63,216
95,017
Movements in working capital:
Increase in stocks
(1,549,737)
(1,964,223)
Decrease/(increase) in debtors
437,093
(58,515)
(Decrease)/increase in creditors
(482,526)
818,121
Decrease in deferred income
-
(9,644)
Cash (absorbed by)/generated from operations
(381,807)
760,777
23
Analysis of changes in net funds
1 April 2022
Cash flows
31 March 2023
£
£
£
Cash at bank and in hand
2,405,861
(1,060,730)
1,345,131
Obligations under finance leases
(12,540)
12,540
-
2,393,321
(1,048,190)
1,345,131
2023-03-312022-04-01falseCCH SoftwareCCH Accounts Production 2023.100Mr M ElliottMr M ElliottMr W RobertsNI0224472022-04-012023-03-31NI022447bus:CompanySecretaryDirector12022-04-012023-03-31NI022447bus:Director12022-04-012023-03-31NI022447bus:Director22022-04-012023-03-31NI022447bus:CompanySecretary12022-04-012023-03-31NI022447bus:RegisteredOffice2022-04-012023-03-31NI022447bus:Agent12022-04-012023-03-31NI0224472023-03-31NI0224472021-04-012022-03-31NI022447core:RetainedEarningsAccumulatedLosses2021-04-012022-03-31NI022447core:RetainedEarningsAccumulatedLosses2022-04-012023-03-31NI0224472022-03-31NI022447core:PlantMachinery2023-03-31NI022447core:FurnitureFittings2023-03-31NI022447core:MotorVehicles2023-03-31NI022447core:PlantMachinery2022-03-31NI022447core:FurnitureFittings2022-03-31NI022447core:MotorVehicles2022-03-31NI022447core:CurrentFinancialInstrumentscore:WithinOneYear2023-03-31NI022447core:CurrentFinancialInstrumentscore:WithinOneYear2022-03-31NI022447core:CurrentFinancialInstruments2023-03-31NI022447core:CurrentFinancialInstruments2022-03-31NI022447core:ShareCapital2023-03-31NI022447core:ShareCapital2022-03-31NI022447core:SharePremium2023-03-31NI022447core:SharePremium2022-03-31NI022447core:CapitalRedemptionReserve2023-03-31NI022447core:CapitalRedemptionReserve2022-03-31NI022447core:RetainedEarningsAccumulatedLosses2023-03-31NI022447core:RetainedEarningsAccumulatedLosses2022-03-31NI022447core:ShareCapital2021-03-31NI022447core:SharePremium2021-03-31NI022447core:CapitalRedemptionReservecore:RestatedAmount2021-03-31NI022447core:RetainedEarningsAccumulatedLosses2021-03-31NI02244712022-04-012023-03-31NI02244712021-04-012022-03-31NI0224472022-03-31NI0224472021-03-31NI022447core:PlantMachinery2022-04-012023-03-31NI022447core:FurnitureFittings2022-04-012023-03-31NI022447core:MotorVehicles2022-04-012023-03-31NI022447core:UKTax2022-04-012023-03-31NI022447core:UKTax2021-04-012022-03-31NI022447core:PlantMachinery2022-03-31NI022447core:FurnitureFittings2022-03-31NI022447core:MotorVehicles2022-03-31NI022447core:Non-currentFinancialInstrumentscore:UnlistedNon-exchangeTraded2023-03-31NI022447core:Non-currentFinancialInstrumentscore:UnlistedNon-exchangeTraded2022-03-31NI022447core:WithinOneYear2023-03-31NI022447core:WithinOneYear2022-03-31NI022447core:BetweenTwoFiveYears2023-03-31NI022447core:BetweenTwoFiveYears2022-03-31NI022447bus:PrivateLimitedCompanyLtd2022-04-012023-03-31NI022447bus:FRS1022022-04-012023-03-31NI022447bus:Audited2022-04-012023-03-31NI022447bus:FullAccounts2022-04-012023-03-31xbrli:purexbrli:sharesiso4217:GBP