Caseware UK (AP4) 2023.0.135 2023.0.135 53Metal pressing & productiontrue2022-09-01false57false 01110007 2022-09-01 2023-08-31 01110007 2021-09-01 2022-08-31 01110007 2023-08-31 01110007 2022-08-31 01110007 c:CompanySecretary1 2022-09-01 2023-08-31 01110007 c:Director2 2022-09-01 2023-08-31 01110007 c:Director5 2022-09-01 2023-08-31 01110007 c:RegisteredOffice 2022-09-01 2023-08-31 01110007 d:PlantMachinery 2022-09-01 2023-08-31 01110007 d:PlantMachinery 2023-08-31 01110007 d:PlantMachinery 2022-08-31 01110007 d:PlantMachinery d:OwnedOrFreeholdAssets 2022-09-01 2023-08-31 01110007 d:MotorVehicles 2022-09-01 2023-08-31 01110007 d:MotorVehicles 2023-08-31 01110007 d:MotorVehicles 2022-08-31 01110007 d:MotorVehicles d:OwnedOrFreeholdAssets 2022-09-01 2023-08-31 01110007 d:FurnitureFittings 2022-09-01 2023-08-31 01110007 d:FurnitureFittings 2023-08-31 01110007 d:FurnitureFittings 2022-08-31 01110007 d:FurnitureFittings d:OwnedOrFreeholdAssets 2022-09-01 2023-08-31 01110007 d:OwnedOrFreeholdAssets 2022-09-01 2023-08-31 01110007 d:Goodwill 2023-08-31 01110007 d:Goodwill 2022-08-31 01110007 d:CurrentFinancialInstruments 2023-08-31 01110007 d:CurrentFinancialInstruments 2022-08-31 01110007 d:Non-currentFinancialInstruments 2023-08-31 01110007 d:Non-currentFinancialInstruments 2022-08-31 01110007 d:CurrentFinancialInstruments d:WithinOneYear 2023-08-31 01110007 d:CurrentFinancialInstruments d:WithinOneYear 2022-08-31 01110007 d:Non-currentFinancialInstruments d:AfterOneYear 2023-08-31 01110007 d:Non-currentFinancialInstruments d:AfterOneYear 2022-08-31 01110007 d:Non-currentFinancialInstruments d:BetweenOneTwoYears 2023-08-31 01110007 d:Non-currentFinancialInstruments d:BetweenOneTwoYears 2022-08-31 01110007 d:Non-currentFinancialInstruments d:BetweenTwoFiveYears 2023-08-31 01110007 d:Non-currentFinancialInstruments d:BetweenTwoFiveYears 2022-08-31 01110007 d:UKTax 2022-09-01 2023-08-31 01110007 d:UKTax 2021-09-01 2022-08-31 01110007 d:ShareCapital 2023-08-31 01110007 d:ShareCapital 2022-08-31 01110007 d:RetainedEarningsAccumulatedLosses 2023-08-31 01110007 d:RetainedEarningsAccumulatedLosses 2022-08-31 01110007 c:FRS102 2022-09-01 2023-08-31 01110007 c:Audited 2022-09-01 2023-08-31 01110007 c:FullAccounts 2022-09-01 2023-08-31 01110007 c:PrivateLimitedCompanyLtd 2022-09-01 2023-08-31 01110007 d:WithinOneYear 2023-08-31 01110007 d:WithinOneYear 2022-08-31 01110007 d:BetweenOneFiveYears 2023-08-31 01110007 d:BetweenOneFiveYears 2022-08-31 01110007 d:AcceleratedTaxDepreciationDeferredTax 2023-08-31 01110007 d:AcceleratedTaxDepreciationDeferredTax 2022-08-31 01110007 d:OtherDeferredTax 2023-08-31 01110007 d:OtherDeferredTax 2022-08-31 01110007 7 2022-09-01 2023-08-31 01110007 d:PlantMachinery d:LeasedAssetsHeldAsLessee 2023-08-31 01110007 d:PlantMachinery d:LeasedAssetsHeldAsLessee 2022-08-31 01110007 d:Goodwill d:OwnedIntangibleAssets 2022-09-01 2023-08-31 01110007 e:PoundSterling 2022-09-01 2023-08-31 iso4217:GBP xbrli:pure

Registered number: 01110007










Pre-Met Limited










Directors' report and financial statements

for the year ended 31 August 2023

 
Pre-Met Limited
 

Company Information


Directors
K W Tonkin 
M Haywood 




Company secretary
K W Tonkin



Registered number
01110007



Registered office
Studley Road

Redditch

Worcestershire

B98 7HJ




Independent auditor
Kreston Reeves LLP
Statutory Auditor & Chartered Accountants

Montague Place

Quayside

Chatham Maritime

Chatham

Kent

ME4 4QU





 
Pre-Met Limited
 

Contents



Page
Directors' report
 
1 - 2
Independent auditor's report
 
3 - 6
Statement of comprehensive income
 
7
Balance sheet
 
8
Notes to the financial statements
 
9 - 20


 
Pre-Met Limited
 

 
Directors' report
for the year ended 31 August 2023

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

Directors' responsibilities statement

The directors are responsible for preparing the Directors' 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), 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 for the Company's financial statements and then apply them consistently;

make judgments 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 to enable them to ensure that the financial statements comply with the Companies Act 2006They 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.

Results and dividends

The profit for the year, after taxation, amounted to £723,978 (2022 - £1,212,749).

During the year, the company paid dividends of £218,500 (2022: £100,000).

Directors

The directors who served during the year were:

K W Tonkin 
M Haywood 

Disclosure of information to auditor

Each of the persons who are directors at the time when this Directors' report is approved has confirmed that:
 
so far as the director is aware, there is no relevant audit information of which the Company's auditor is unaware, and

the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditor is aware of that information.

Auditor

Under section 487(2) of the Companies Act 2006Kreston Reeves LLP will be deemed to have been reappointed as auditor 28 days after these financial statements were sent to members or 28 days after the latest date prescribed for filing the accounts with the registrar, whichever is earlier.

Page 1

 
Pre-Met Limited
 

 
Directors' report (continued)
for the year ended 31 August 2023


In preparing this report, the directors have taken advantage of the small companies exemptions provided by section 415A of the Companies Act 2006.

This report was approved by the board on 18 December 2023 and signed on its behalf.
 





M Haywood
Director

Page 2

 
Pre-Met Limited
 

 
Independent auditor's report to the members of Pre-Met Limited
 

Opinion


We have audited the financial statements of Pre-Met Limited (the 'Company') for the year ended 31 August 2023, which comprise the Statement of comprehensive income, the Balance sheet and the related notes, including a summary of significant accounting policiesThe 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 August 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.


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 United Kingdom, including the Financial Reporting Council'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 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 ReportOur 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.


Page 3

 
Pre-Met Limited
 

 
Independent auditor's report to the members of Pre-Met Limited (continued)


Opinion 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 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.


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 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 directors' remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit; or
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 Directors' responsibilities statement set out on page 1, 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.


Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
Page 4

 
Pre-Met Limited
 

 
Independent auditor's report to the members of Pre-Met Limited (continued)


Capability of the audit in detecting irregularities, including fraud
Based on our understanding of the company and industry, and through discussion with the directors and other management (as required by auditing standards), we identified that the principal risks of non-compliance with laws and regulations related to health and safety and employment law. We considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006 and taxation. We communicated identified laws and regulations throughout our team and remained alert to any indications of non-compliance throughout the audit. We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to posting inappropriate journal entries to increase revenue or reduce expenditure and management bias in accounting estimates and judgemental areas of the financial statements. Audit procedures performed by the engagement team included:
 
Discussions with management and assessment of known or suspected instances of non-compliance with laws and regulations (including health and safety) and fraud, and review of the reports made by management;
Assessment of identified fraud risk factors;
Challenging assumptions and judgements made by management in its significant accounting estimates;
Checking and reperforming the reconciliation of key control accounts;
Performing analytical procedures to identify any unusual or unexpected relationships, including related party transactions, that may indicate risks of material misstatement due to fraud;
Confirmation of related parties with management, and review of transactions throughout the period to identify any previously undisclosed transactions with related parties outside the normal course of business;
Review of significant and unusual transactions and evaluation of the underlying financial rationale supporting the transactions; and
Identifying and testing journal entries, in particular any manual entries made at the year end for financial statement preparation.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.


As part of an audit in accordance with ISAs (UK), we exercise professional judgment and maintain professional scepticism throughout the audit. We also:


Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion of the effectiveness of the Company's internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.
Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our Auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our Auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern.
Page 5

 
Pre-Met Limited
 

 
Independent auditor's report to the members of Pre-Met Limited (continued)


Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.


We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.


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 2006Our 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.





Andrew Griggs BA FCA CF (Senior statutory auditor)
  
for and on behalf of
Kreston Reeves LLP
 
Statutory Auditor
Chartered Accountants
  
Chatham Maritime

18 December 2023
Page 6

 
Pre-Met Limited
 

Statement of comprehensive income
for the year ended 31 August 2023

2023
2022
Note
£
£

  

Turnover
  
5,550,804
6,611,576

Cost of sales
  
(3,249,334)
(3,690,393)

Gross profit
  
2,301,470
2,921,183

Distribution costs
  
(124,401)
(180,595)

Administrative expenses
  
(1,249,326)
(1,197,574)

Operating profit
  
927,743
1,543,014

Interest payable and similar expenses
  
(15,733)
(13,658)

Profit before tax
  
912,010
1,529,356

Tax on profit
 4 
(188,032)
(316,607)

Profit for the financial year
  
723,978
1,212,749

There was no other comprehensive income for 2023 (2022:£NIL).

The notes on pages 9 to 20 form part of these financial statements.

Page 7

 
Pre-Met Limited
Registered number: 01110007

Balance sheet
as at 31 August 2023

2023
2022
Note
£
£

Fixed assets
  

Intangible assets
 5 
-
28,896

Tangible assets
 6 
287,130
328,472

  
287,130
357,368

Current assets
  

Stocks
 7 
610,355
936,021

Debtors: amounts falling due within one year
 8 
873,780
1,160,756

Cash at bank and in hand
 9 
1,900,403
1,170,503

  
3,384,538
3,267,280

Creditors: amounts falling due within one year
 10 
(706,681)
(1,094,114)

Net current assets
  
 
 
2,677,857
 
 
2,173,166

Total assets less current liabilities
  
2,964,987
2,530,534

Creditors: amounts falling due after more than one year
 11 
(77,778)
(155,556)

Provisions for liabilities
  

Deferred tax
 13 
(58,985)
(52,232)

Net assets
  
2,828,224
2,322,746


Capital and reserves
  

Called up share capital 
  
10,000
10,000

Profit and loss account
  
2,818,224
2,312,746

  
2,828,224
2,322,746


The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime and in accordance with the provisions of FRS 102 Section 1A - small entities.

The financial statements were approved and authorised for issue by the board and were signed on its behalf on 18 December 2023.




M Haywood
Director

The notes on pages 9 to 20 form part of these financial statements.

Page 8

 
Pre-Met Limited
 

 
Notes to the financial statements
for the year ended 31 August 2023

1.


General information

Pre-Met Limited is a private company limited by shares, with registration number 01110007, and is incorporated in England and Wales.  The address of the registered office and principal place of business is Studley Road, Redditch, Worcestershire, B98 7HJ.  The principal activity of the company is the manufacture of precision metal presswork and related tools.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Section 1A of Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies.

The following principal accounting policies have been applied:

 
2.2

Going concern

The directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. On this basis, the directors consider it appropriate to prepare the financial statements on the going concern basis.

 
2.3

Revenue

Revenue 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. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:

Sale of goods

Revenue from the sale of goods is recognised when all of the following conditions are satisfied:
the Company has transferred the significant risks and rewards of ownership to the buyer;
the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
the amount of revenue can be measured reliably;
it is probable that the Company will receive the consideration due under the transaction; and
the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Page 9

 
Pre-Met Limited
 

 
Notes to the financial statements
for the year ended 31 August 2023

2.Accounting policies (continued)

 
2.4

Intangible assets

Goodwill
Goodwill represents the difference between amounts paid on the cost of a business combination and the acquirer’s interest in the fair value of its identifiable assets and liabilities of the acquiree at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is amortised on a straight line basis to the Statement of income and retained earnings over its useful economic life.
The useful economic life of the goodwill has been determined by considering the build up of the goodwill and the expected period from which revenue will be generated from each constituent part included within.

 
2.5

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.

Depreciation is provided on the following bases:

Plant and machinery
-
5 to 10 years
Motor vehicles
-
3 to 4 years
Furniture, fittings and equipment
-
3 to 10 years

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

 
2.6

Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads.

At each balance sheet date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.

 
2.7

Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

Page 10

 
Pre-Met Limited
 

 
Notes to the financial statements
for the year ended 31 August 2023

2.Accounting policies (continued)

 
2.8

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours.

 
2.9

Financial instruments

The Company has elected to apply the provisions of Section 11 “Basic Financial Instruments” 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 trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.

Discounting is omitted where the effect of discounting is immaterial. The Company's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.

Impairment of financial assets

Financial assets are assessed for indicators of impairment at each reporting date. 

Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.

If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.

Financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instruments any contract that evidences a residual interest in the assets of the Company after the deduction of all its liabilities.

Basic financial liabilities, which include trade and other payables, bank loans and other loans are initially measured at their transaction price after transaction costs. When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. Discounting is omitted where the effect of discounting is immaterial.

Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.
Page 11

 
Pre-Met Limited
 

 
Notes to the financial statements
for the year ended 31 August 2023

2.Accounting policies (continued)


2.9
Financial instruments (continued)


Trade payables are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade payables are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.

Derecognition of financial instruments

Derecognition of financial assets

Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Company transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Company will continue to recognise the value of the portion of the risks and rewards retained.

Derecognition of financial liabilities

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

 
2.10

Creditors

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

  
2.11

Invoice discounting

The company has an agreement with Yorkshire Bank (a trading name of Clydesdale Bank plc) whereby the majority of its trade debtors are able to be are discounted with recourse after 90 days. On the basis that the benefits and  risks attaching to the debts remain with the company, a separate presentation has been adopted, in accordance with FRS 102'. On this basis the gross debts are included as an asset within trade debtors and the proceeds received are included within bank loans and overdrafts as a liability.

 
2.12

Government grants

Grants are accounted under the accruals model as permitted by FRS 102. Grants relating to expenditure on tangible fixed assets are credited to profit or loss at the same rate as the depreciation on the assets to which the grant relates. The deferred element of grants is included in creditors as deferred income.
Grants of a revenue nature are recognised in the Statement of comprehensive income in the same period as the related expenditure.

Page 12

 
Pre-Met Limited
 

 
Notes to the financial statements
for the year ended 31 August 2023

2.Accounting policies (continued)

 
2.13

Foreign currency translation

Functional and presentation currency

The company's functional and presentational currency is pound sterling.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.

 
2.14

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

 
2.15

Dividends

Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders.

 
2.16

Operating leases: the Company as lessee

Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.

 
2.17

Leased assets: the Company as lessee

Assets obtained under hire purchase contracts and finance leases are capitalised as tangible fixed assets. Assets acquired by finance lease are depreciated over the shorter of the lease term and their useful lives. Assets acquired by hire purchase are depreciated over their useful lives. Finance leases are those where substantially all of the benefits and risks of ownership are assumed by the company. Obligations under such agreements are included in creditors net of the finance charge allocated to future periods. The finance element of the rental payment is charged to profit or loss so as to produce a constant periodic rate of charge on the net obligation outstanding in each period.

Page 13

 
Pre-Met Limited
 

 
Notes to the financial statements
for the year ended 31 August 2023

2.Accounting policies (continued)

 
2.18

Pensions

Defined contribution pension plan

The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.

The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Balance sheet. The assets of the plan are held separately from the Company in independently administered funds.

 
2.19

Holiday pay accrual

A liability is recognised to the extent of any unused holiday pay entitlement which is accrued at the balance sheet date and carried forward to future periods. This is measured at the undiscounted salary cost of the future holiday entitlement so accrued at the balance sheet date.

 
2.20

Borrowing costs

All borrowing costs are recognised in profit or loss in the year in which they are incurred.

 
2.21

Provisions for liabilities

Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
 
Increases in provisions are generally charged as an expense to profit or loss.

 
2.22

Current and deferred taxation

The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Company operates and generates income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Page 14

 
Pre-Met Limited
 

 
Notes to the financial statements
for the year ended 31 August 2023

2.Accounting policies (continued)

 
2.23

Research and development

Research and development expenditure is written off in the year in which it is incurred.


3.


Employees

The average monthly number of employees, including directors, during the year was 53 (2022 - 57).


4.


Taxation


2023
2022
£
£

Corporation tax


Current tax on profits for the year
210,165
309,425

Adjustments in respect of previous periods
(28,886)
-


Total current tax
181,279
309,425

Deferred tax


Origination and reversal of timing differences
6,753
7,182


Taxation on profit on ordinary activities
188,032
316,607

Factors affecting tax charge for the year

The tax assessed for the year is lower than (2022 - higher than) the standard rate of corporation tax in the UK of 25% (2022 - 19%). The differences are explained below:

2023
2022
£
£


Profit on ordinary activities before tax
912,010
1,529,356


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2022 - 19%)
228,003
290,578

Effects of:


Non-tax deductible amortisation of goodwill and impairment
7,224
1,163

Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
410
24,866

Capital allowances for year in excess of depreciation
1,167
-

Adjustments to tax charge in respect of prior periods
(28,886)
-

Other differences leading to an increase (decrease) in the tax charge
(19,886)
-

Total tax charge for the year
188,032
316,607

Page 15

 
Pre-Met Limited
 

 
Notes to the financial statements
for the year ended 31 August 2023
 
4.Taxation (continued)


Factors that may affect future tax charges

There were no factors that may affect future tax charges.


5.


Intangible assets




Goodwill

£



Cost


At 1 September 2022
145,814



At 31 August 2023
145,814



Amortisation


At 1 September 2022
116,918


Charge for the year on owned assets
28,896



At 31 August 2023
145,814



Net book value



At 31 August 2023
-



At 31 August 2022
28,896



Page 16

 
Pre-Met Limited
 

 
Notes to the financial statements
for the year ended 31 August 2023

6.


Tangible fixed assets





Plant and machinery
Motor vehicles
Furniture, fittings and equipment
Total

£
£
£
£



Cost


At 1 September 2022
1,317,749
85,226
154,472
1,557,447


Additions
35,113
-
17,014
52,127


Disposals
(74,774)
(13,847)
(38,246)
(126,867)



At 31 August 2023

1,278,088
71,379
133,240
1,482,707



Depreciation


At 1 September 2022
1,106,595
54,580
67,800
1,228,975


Charge for the year on owned assets
57,727
11,885
21,310
90,922


Disposals
(72,227)
(13,847)
(38,246)
(124,320)



At 31 August 2023

1,092,095
52,618
50,864
1,195,577



Net book value



At 31 August 2023
185,993
18,761
82,376
287,130



At 31 August 2022
211,154
30,646
86,672
328,472

The net book value of assets held under finance leases or hire purchase contracts, included above, are as follows:


2023
2022
£
£



Plant and machinery
-
162,718


7.


Stocks

2023
2022
£
£

Raw materials and consumables
273,985
399,752

Work in progress
60,159
160,754

Finished goods and goods for resale
276,211
375,515

610,355
936,021


Page 17

 
Pre-Met Limited
 

 
Notes to the financial statements
for the year ended 31 August 2023

8.


Debtors

2023
2022
£
£


Trade debtors
826,394
1,130,407

Prepayments and accrued income
47,386
30,349

873,780
1,160,756



9.


Cash and cash equivalents

2023
2022
£
£

Cash at bank and in hand
1,900,403
1,170,503

Less: bank overdrafts and CID facility
-
(548)

1,900,403
1,169,955



10.


Creditors: Amounts falling due within one year

2023
2022
£
£

Bank overdrafts and CID facility
-
548

Bank loans
77,778
77,777

Trade creditors
328,739
542,520

Corporation tax
210,165
305,400

Other taxation and social security
44,298
38,866

Obligations under finance lease and hire purchase contracts
-
17,188

Other creditors
430
357

Accruals and deferred income
45,271
111,458

706,681
1,094,114



11.


Creditors: Amounts falling due after more than one year

2023
2022
£
£

Bank loans
77,778
155,556


Secured loans
The banking and finance liabilities are secured by a fixed charge over all present and future assets of the group.

Page 18

 
Pre-Met Limited
 

 
Notes to the financial statements
for the year ended 31 August 2023

12.


Loans


Analysis of the maturity of loans is given below:


2023
2022
£
£

Amounts falling due within one year

Bank loans
77,778
77,777

Amounts falling due 1-2 years

Bank loans
77,778
77,778

Amounts falling due 2-5 years

Bank loans
-
77,778

155,556
233,333



13.


Deferred taxation




2023


£






At beginning of year
(52,232)


Charged to profit or loss
(6,753)



At end of year
(58,985)

The provision for deferred taxation is made up as follows:

2023
2022
£
£


Accelerated capital allowances
(60,742)
(53,483)

Other timing differences
1,757
1,251

(58,985)
(52,232)

Page 19

 
Pre-Met Limited
 

 
Notes to the financial statements
for the year ended 31 August 2023

14.


Commitments under operating leases

At 31 August 2023 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:

2023
2022
£
£


Not later than 1 year
90,000
180,000

Later than 1 year and not later than 5 years
-
90,000

90,000
270,000


15.


Controlling party

The ultimate holding company is Pre-Met Holdings Limited, a company registered in England and Wales.  The company's ultimate controlling parties are Mr K W Tonkin and Mrs S Tonkin, the majority shareholders of Pre-Met Holdings Limited.


Page 20