Company registration number 01013271 (England and Wales)
ELECTRO-REPLACEMENT LIMITED
ANNUAL REPORT AND UNAUDITED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2023
PAGES FOR FILING WITH REGISTRAR
ELECTRO-REPLACEMENT LIMITED
CONTENTS
Page
Directors' report
1
Balance sheet
2 - 3
Notes to the financial statements
4 - 9
ELECTRO-REPLACEMENT LIMITED
DIRECTORS' REPORT
FOR THE PERIOD ENDED 30 JUNE 2023
- 1 -
The directors present their annual report and financial statements for the period ended 30 June 2023.
Directors
The directors who held office during the period and up to the date of signature of the financial statements were as follows:
Mrs L Schonthal
Mr S Freedman
Post reporting date events
After the year end the COVID-19 global pandemic and subsequent intervention from governments worldwide continues to have an impact on the projected growth of the company.
The directors are in constant dialogue with the large customers and suppliers using digital technology and Eplatform to ensure continued trading and possibilities of extending customer base.
Small companies exemption
This report has been prepared in accordance with the provisions applicable to companies entitled to the small companies exemption.
On behalf of the board
Mrs L Schonthal
Director
8 March 2024
ELECTRO-REPLACEMENT LIMITED
BALANCE SHEET
- 2 -
30 June 2023
31 December 2021
Notes
£
£
£
£
Fixed assets
Tangible assets
3
86,906
137,445
Investment property
4
18,000
18,000
104,906
155,445
Current assets
Stocks
344,967
314,924
Debtors
5
352,251
284,110
Cash at bank and in hand
514
23,981
697,732
623,015
Creditors: amounts falling due within one year
6
(578,658)
(421,875)
Net current assets
119,074
201,140
Total assets less current liabilities
223,980
356,585
Creditors: amounts falling due after more than one year
7
(23,459)
(65,281)
Net assets
200,521
291,304
Capital and reserves
Called up share capital
8
100,000
100,000
Profit and loss reserves
100,521
191,304
Total equity
200,521
291,304
The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true
For the financial period ended 30 June 2023 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.
The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.
The member has not required the company to obtain an audit of its financial statements for the period in question in accordance with section 476.
These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.
ELECTRO-REPLACEMENT LIMITED
BALANCE SHEET (CONTINUED)
- 3 -
The financial statements were approved by the board of directors and authorised for issue on 8 March 2024 and are signed on its behalf by:
Mrs L Schonthal
Director
Company Registration No. 01013271
ELECTRO-REPLACEMENT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2023
- 4 -
1
Accounting policies
Company information
Electro-Replacement Limited is a private company limited by shares incorporated in England and Wales. The registered office is Lynwood House, 373-375 Station Road, Harrow, Middlesex, HA1 2AW.
1.1
Reporting period
The directors have made a decision to change the accounting reporting period from December 2022 to June 2023, thereby presenting a set of accounts for a period of 18 months. The prior accounting period was for 12 months to December 2021. Therefore, the comparative figures including the notes in the financial statements are not entirely comparable.
1.2
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 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention, modified to include the revaluation of investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.
1.3
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.
ELECTRO-REPLACEMENT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 5 -
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:
Leasehold buildings
Over the length of the lease of 20 years
Plant and machinery
15% and 25% reducing balance
Fixtures, fittings and equipment
15% reducing balance
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
Investment property
Investment property, which is property held to earn rentals and/or for capital appreciation, is initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Subsequently it is measured at fair value at the reporting end date. Changes in fair value are recognised in profit or loss.
1.6
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.
1.7
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.
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.
1.8
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
ELECTRO-REPLACEMENT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 6 -
1.9
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.
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.
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.
1.10
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.
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.
ELECTRO-REPLACEMENT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 7 -
1.13
Leases
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.
Rentals payable under operating leases are charged against income on a straight line basis over the lease term.
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.
1.15
Foreign exchange
Monetary assets and liabilities denominated in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. All differences are taken to the profit and loss account.
2
Employees
The average monthly number of persons (including directors) employed by the company during the period was:
2023
2021
Number
Number
Total
7
7
3
Tangible fixed assets
Land and buildings
Plant and machinery etc
Total
£
£
£
Cost
At 1 January 2022 and 30 June 2023
22,587
462,016
484,603
Depreciation and impairment
At 1 January 2022
22,324
324,834
347,158
Depreciation charged in the period
230
50,309
50,539
At 30 June 2023
22,554
375,143
397,697
Carrying amount
At 30 June 2023
33
86,873
86,906
At 31 December 2021
263
137,182
137,445
ELECTRO-REPLACEMENT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2023
- 8 -
4
Investment property
2023
£
Fair value
At 1 January 2022 and 30 June 2023
18,000
The investment property is valued at £18,000 (suggested sales price) in June 2016 by Cameron Lodges Ltd. The directors consider the market value of the property to be the appropriate fair value at the balance sheet date.
5
Debtors
2023
2021
Amounts falling due within one year:
£
£
Trade debtors
70,055
115,550
Amounts owed by group undertakings
69,960
69,960
Other debtors
212,236
98,600
352,251
284,110
6
Creditors: amounts falling due within one year
2023
2021
£
£
Bank loans and overdrafts
32,648
36,766
Trade creditors
434,275
344,820
Taxation and social security
6,900
10,090
Other creditors
104,835
30,199
578,658
421,875
7
Creditors: amounts falling due after more than one year
2023
2021
£
£
Bank loans and overdrafts
23,459
65,281
8
Called up share capital
2023
2021
2023
2021
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
100,000
100,000
100,000
100,000
ELECTRO-REPLACEMENT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2023
- 9 -
9
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, as follows:
2023
2021
£
£
22,917
130,208
10
Related party transactions
Transactions with related parties
During the period the company entered into the following transactions with related parties:
Consultancy fees
Rent paid
2023
2021
2023
2021
£
£
£
£
Other related parties
7,200
4,900
108,750
72,500
The following amounts were outstanding at the reporting end date:
2023
2021
Amounts due from related parties
£
£
Entities with control, joint control or significant influence over the company
69,960
69,960
11
Directors' transactions
At the balance sheet date, the company owes an amount of £96,445 (2021: £23,169) to the directors.
During the year an amount of £260,000 (2021: £425,000) was written off a loan due to the directors.
12
Parent company
The parent company of Electro-Replacement Limited is Peter Schonthal Agencies Limited, a company incorporated in England and Wales. Its registered office is Lynwood House, 373-375 Station Road, Harrow, Middlesex HA1 2AW.