Caseware UK (AP4) 2023.0.135 2023.0.135 2023-06-302023-05-232023-05-232023-06-30false2false22022-07-01falsefalse 12140170 2022-07-01 2023-06-30 12140170 2021-07-01 2022-06-30 12140170 2023-06-30 12140170 2022-06-30 12140170 2021-07-01 12140170 1 2022-07-01 2023-06-30 12140170 1 2021-07-01 2022-06-30 12140170 5 2022-07-01 2023-06-30 12140170 5 2021-07-01 2022-06-30 12140170 d:Director1 2022-07-01 2023-06-30 12140170 d:Director2 2022-07-01 2023-06-30 12140170 d:Director3 2022-07-01 2023-06-30 12140170 d:Director3 2023-06-30 12140170 d:RegisteredOffice 2022-07-01 2023-06-30 12140170 d:Agent1 2022-07-01 2023-06-30 12140170 e:OfficeEquipment 2022-07-01 2023-06-30 12140170 e:OfficeEquipment 2023-06-30 12140170 e:OfficeEquipment 2022-06-30 12140170 e:OfficeEquipment e:OwnedOrFreeholdAssets 2022-07-01 2023-06-30 12140170 e:CurrentFinancialInstruments 2023-06-30 12140170 e:CurrentFinancialInstruments 2022-06-30 12140170 e:CurrentFinancialInstruments e:WithinOneYear 2023-06-30 12140170 e:CurrentFinancialInstruments e:WithinOneYear 2022-06-30 12140170 e:ReportableOperatingSegment1 2022-07-01 2023-06-30 12140170 e:ReportableOperatingSegment1 2021-07-01 2022-06-30 12140170 e:UKTax 2022-07-01 2023-06-30 12140170 e:UKTax 2021-07-01 2022-06-30 12140170 e:ShareCapital 2022-07-01 2023-06-30 12140170 e:ShareCapital 2023-06-30 12140170 e:ShareCapital 2021-07-01 2022-06-30 12140170 e:ShareCapital 2022-06-30 12140170 e:ShareCapital 2021-07-01 12140170 e:RetainedEarningsAccumulatedLosses 2022-07-01 2023-06-30 12140170 e:RetainedEarningsAccumulatedLosses 2023-06-30 12140170 e:RetainedEarningsAccumulatedLosses 2021-07-01 2022-06-30 12140170 e:RetainedEarningsAccumulatedLosses 2022-06-30 12140170 e:RetainedEarningsAccumulatedLosses 2021-07-01 12140170 e:FinancialAssetsDesignatedFairValueThroughProfitOrLoss 2023-06-30 12140170 e:FinancialAssetsDesignatedFairValueThroughProfitOrLoss 2022-06-30 12140170 d:OrdinaryShareClass1 2022-07-01 2023-06-30 12140170 d:OrdinaryShareClass1 2023-06-30 12140170 d:OrdinaryShareClass1 2022-06-30 12140170 d:FRS102 2022-07-01 2023-06-30 12140170 d:Audited 2022-07-01 2023-06-30 12140170 d:FullAccounts 2022-07-01 2023-06-30 12140170 d:PrivateLimitedCompanyLtd 2022-07-01 2023-06-30 12140170 f:PoundSterling 2022-07-01 2023-06-30 xbrli:shares iso4217:GBP xbrli:pure

Registered number: 12140170









TUFAIL CHEMICALS UK LIMITED









ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30 JUNE 2023

 
TUFAIL CHEMICALS UK LIMITED
 
 
COMPANY INFORMATION


Directors
Zubair Farid Tufail 
Yasin Altaf 
Dhruv Shamik Patel (appointed 23 May 2023, resigned 31 December 2023)




Registered number
12140170



Registered office
27 Old Gloucester Street

London

WC1N 3AX




Independent auditors
Accendo Consulting Ltd
Chartered Certified Accountants & Statutory Auditors

160 City Road

London

EC1V 2NX




Bankers
HBL Bank UK Limited
161 – 163 Commercial Road

London

E1 2DA





 
TUFAIL CHEMICALS UK LIMITED
 

CONTENTS



Page
Strategic Report
 
1
Directors' Report
 
2 - 3
Independent Auditors' Report
 
4 - 7
Statement of Comprehensive Income
 
8
Statement of Financial Position
 
9
Statement of Changes in Equity
 
10 - 11
Statement of Cash Flows
 
12
Analysis of Net Debt
 
13
Notes to the Financial Statements
 
14 - 25


 
TUFAIL CHEMICALS UK LIMITED
 
 
STRATEGIC REPORT
FOR THE YEAR ENDED 30 JUNE 2023

Introduction
 
The directors present their strategic report for the period ended 30 June 2023.

Business review
 
The main activities of the business were sale of industrial chemicals. The directors are pleased to report on a successful year despite current economic uncertainty. 
The company achieved turnover of £4.6m (2022: £2.9m) during the year. The future outlook is positive for industrial and cleaning chemicals. The directors are confident that the company will continue to grow and further increase its turnover.

Principal risks and uncertainties
 
Economic risk
The current economic uncertainty has not had a material impact on the company’s business. The company sells industrial chemicals which are used in cleaning products and has noticed an increase in demand for its products since COVID-19 pandemic. The company does not have any significant fixed cost and has the ability to cut its variable cost in the unlikely event of falling demand for its product.
Credit risk
Customers usually pay a percentage of order in advance and the balance is paid on receipt of goods. The credit risk is managed via use of letter of credit which ensures that funds are released to company’s bank upon receipt of goods.

Financial key performance indicators
 
The management uses following key performance indicators to track performance of the company:
1. Turnover growth
2. Gross profit margin
3. Earning before interest, tax, depreciation and amortisation (EBITDA).
During the period, the company achieved GP margin of 7.6% (2022: -0.4%) and EBITDA of £197k (2022: -£117k).


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



................................................
Yasin Altaf
Director

Date: 26 March 2024

Page 1

 
TUFAIL CHEMICALS UK LIMITED
 
 
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023

The directors present their report and the financial statements for the year ended 30 June 2023.

Directors' responsibilities statement

The directors are responsible for preparing the Strategic Report, 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;

state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;

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.

Principal activity

During the period the company's principal activity was sale of industrial chemicals.

Results and dividends

The profit for the year, after taxation, amounted to £195,485 (2022 - loss £117,426).



Directors

The directors who served during the year were:

Zubair Farid Tufail 
Yasin Altaf 
Dhruv Shamik Patel (appointed 23 May 2023, resigned 31 December 2023)

Future developments

The company will continue to build upon the growth achieved in first year and prepare for further expansion in future.

Page 2

 
TUFAIL CHEMICALS UK LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023

Disclosure of information to auditors

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 auditors are 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 auditors are aware of that information.

Post balance sheet events

There have been no significant events affecting the Company since the year end.

Auditors

The auditorsAccendo Consulting Ltdwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

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





................................................
Yasin Altaf
Director

Date: 26 March 2024

Page 3

 
TUFAIL CHEMICALS UK LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF TUFAIL CHEMICALS UK LIMITED
 

Opinion


We have audited the financial statements of Tufail Chemicals UK Limited (the 'Company') for the year ended 30 June 2023, which comprise the Statement of Comprehensive Income, the Statement of Financial Position, the Statement of Cash Flows, the Statement of Changes in Equity 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 30 June 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 Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the 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.


Page 4

 
TUFAIL CHEMICALS UK LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF TUFAIL CHEMICALS UK LIMITED (CONTINUED)


Other information


The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' 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.


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 Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.


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 directors' 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 set out on page 2, 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.


Page 5

 
TUFAIL CHEMICALS UK LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF TUFAIL CHEMICALS UK LIMITED (CONTINUED)


Auditors' responsibilities for the audit of the financial statements
 

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditors' 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:
We identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and then design and perform audit procedures responsive to those risks, including obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion.
Identifying and assessing potential risks related to irregularities
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, we considered the following:
Audit response to risks identified
• The nature of the industry and sector, control environment and business performance including the design of the Company’s remuneration policies, key drivers for directors’ remuneration, bonus levels and performance targets;
• results of our enquiries of management about their own identification and assessment of the risks of irregularities and any matters we identified having reviewed the Company’s policies and procedures;
• the matters discussed among the audit engagement team regarding how and where fraud might occur in the financial statements and any potential indicators of fraud.
As a result of these procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in relation to revenue recognition. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override.
We also obtained an understanding of the legal and regulatory frameworks that the Company operates in and focused on those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included the Companies Act 2006 and local tax legislation.
In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which may be fundamental to the Company’s ability to operate or to avoid a material fine or penalty.
Audit response to risks identified
As a result of performing the above, we identified revenue recognition as a key audit matter related to the potential risk of fraud. Our procedures to respond to risks identified included the following:
• reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements;
 
Page 6

 
TUFAIL CHEMICALS UK LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF TUFAIL CHEMICALS UK LIMITED (CONTINUED)


• enquiring of management, concerning actual and potential litigation and claims;
• performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;
• reading minutes of meetings of those charged with governance;
• obtaining an understanding of provisions and discussing with management to understand the basis of recognition or non-recognition of tax provisions; and
• in addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.
We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members and remained alert to any indications of fraud or noncompliance with laws and regulations throughout the audit.


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.


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


Use of our report
 

This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 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 Auditors' 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.





R M Asif Rafique (Senior Statutory Auditor)
for and on behalf of
Accendo Consulting Ltd
Chartered Certified Accountants & Statutory Auditors

26 March 2024
Page 7

 
TUFAIL CHEMICALS UK LIMITED
 
 
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2023

2023
2022
Note
£
£

  

Turnover
 4 
4,647,705
2,941,986

Cost of sales
  
(4,292,280)
(2,954,193)

Gross profit/(loss)
  
355,425
(12,207)

Administrative expenses
  
(158,034)
(105,219)

Operating profit/(loss)
 5 
197,391
(117,426)

Interest payable and similar expenses
 9 
(51)
-

Profit/(loss) before tax
  
197,340
(117,426)

Tax on profit/(loss)
 10 
(1,855)
-

Profit/(loss) for the financial year
  
195,485
(117,426)

There were no recognised gains and losses for 2023 or 2022 other than those included in the statement of comprehensive income.

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

The notes on pages 14 to 25 form part of these financial statements.

Page 8

 
TUFAIL CHEMICALS UK LIMITED
REGISTERED NUMBER: 12140170

STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2023

2023
2022
Note
£
£

Fixed assets
  

Tangible assets
 11 
499
739

  
499
739

Current assets
  

Stocks
 12 
268,603
675,340

Debtors: amounts falling due within one year
 13 
731,070
232,179

Cash at bank and in hand
 14 
262,216
169,738

  
1,261,889
1,077,257

Creditors: amounts falling due within one year
 15 
(1,253,881)
(1,264,974)

Net current assets/(liabilities)
  
 
 
8,008
 
 
(187,717)

Total assets less current liabilities
  
8,507
(186,978)

  

Net assets/(liabilities)
  
8,507
(186,978)


Capital and reserves
  

Called up share capital 
 17 
100
100

Profit and loss account
  
8,407
(187,078)

  
8,507
(186,978)


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 




................................................
Zubair Farid Tufail
................................................
Yasin Altaf
Director
Director


Date: 26 March 2024
Date:26 March 2024

The notes on pages 14 to 25 form part of these financial statements.

Page 9

 
TUFAIL CHEMICALS UK LIMITED
 

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2023


Called up share capital
Profit and loss account
Total equity

£
£
£

At 1 July 2022
100
(187,078)
(186,978)


Comprehensive income for the year

Profit for the year

-
195,485
195,485


Other comprehensive income for the year
-
-
-


Total comprehensive income for the year
-
195,485
195,485


Total transactions with owners
-
-
-


At 30 June 2023
100
8,407
8,507


The notes on pages 14 to 25 form part of these financial statements.

Page 10

 
TUFAIL CHEMICALS UK LIMITED
 

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2022


Called up share capital
Profit and loss account
Total equity

£
£
£

At 1 July 2021
100
(69,652)
(69,552)


Comprehensive income for the year

Loss for the year

-
(117,426)
(117,426)


Other comprehensive income for the year
-
-
-


Total comprehensive income for the year
-
(117,426)
(117,426)


Total transactions with owners
-
-
-


At 30 June 2022
100
(187,078)
(186,978)


The notes on pages 14 to 25 form part of these financial statements.

Page 11

 
TUFAIL CHEMICALS UK LIMITED
 

STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2023

2023
2022
£
£

Cash flows from operating activities

Profit/(loss) for the financial year
195,485
(117,426)

Adjustments for:

Depreciation of tangible assets
240
240

Interest paid
51
-

Taxation charge
1,855
-

Decrease/(increase) in stocks
571,491
(327,194)

(Increase)/decrease in debtors
(200,787)
48,008

Decrease/(increase) in amounts owed by groups
134,161
(227,865)

(Decrease)/increase in creditors
(281,000)
123,748

Net cash generated from operating activities

421,496
(500,489)



Cash flows from financing activities

New loans from group companies
131,132
75,313

Loans from group companies repaid
-
(37,585)

Interest paid
(51)
-

Net cash used in financing activities
131,081
37,728

Net increase/(decrease) in cash and cash equivalents
552,577
(462,761)

Cash and cash equivalents at beginning of year
(455,115)
7,646

Cash and cash equivalents at the end of year
97,462
(455,115)


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
262,216
169,738

Bank overdrafts
(164,754)
(624,853)

97,462
(455,115)


The notes on pages 14 to 25 form part of these financial statements.

Page 12

 
TUFAIL CHEMICALS UK LIMITED
 

ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 30 JUNE 2023




At 1 July 2022
Cash flows
At 30 June 2023
£

£

£

Cash at bank and in hand

169,738

92,478

262,216

Bank overdrafts

(624,853)

460,099

(164,754)


(455,115)
552,577
97,462

The notes on pages 14 to 25 form part of these financial statements.

Page 13

 
TUFAIL CHEMICALS UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

1.


General information

The entity is a private company limited by shares and incorporated in England & Wales. The company’s
registered office and registration number are on company information page.

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 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 (see note 3).

The following principal accounting policies have been applied:

 
2.2

Going concern

As at the date of approval of these accounts the business has sufficient cash and financing facility to cover its fixed costs for the foreseeable future. The business has continued to receive orders from customers, and it expects a satisfactory level of turnover will be achieved to support the business during current crisis.
During the year, the Company generated profit of £195k. At the year end the Company’s has net assets of £8k. Tufail Chemical Industries Limited i.e., the parent Company has provided letter of comfort to the bankers of the company as security whereby the parent company confirms, agrees, and undertakes that it will ensure and/or procure that all the terms of, and the liabilities of the Company arising under current and future financing facilities are met in full.
Tufail Chemical Industries Limited i.e., the parent Company has provided letter of comfort to the bankers of the company as security whereby the parent company confirms, agrees, and undertakes that it will ensure and/or procure that all the terms of, and the liabilities of the company arising under current and future financing facilities are met in full.
The directors are satisfied that at the date of approval of financial statements, the Company has sufficient resources to continue as a going concern and the current uncertainties discussed above will not impact the ability of the Company to continue as a going concern for the foreseeable future. The directors, having considered this and the financial position of the Company, have a reasonable expectation that the Company will continue in operational existence and thus they continue to adopt the going concern basis of accounting in preparing these financial statements.

Page 14

 
TUFAIL CHEMICALS UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

2.Accounting policies (continued)

 
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.

Rendering of services

Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
the amount of revenue can be measured reliably;
it is probable that the Company will receive the consideration due under the contract;
the stage of completion of the contract at the end of the reporting period can be measured reliably; and
the costs incurred and the costs to complete the contract can be measured reliably.

 
2.4

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.

Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.

 
2.5

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.

 
2.6

Borrowing costs

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

Page 15

 
TUFAIL CHEMICALS UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

2.Accounting policies (continued)

 
2.7

Taxation

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 reporting date in the countries where the Company operates and generates income.

 
2.8

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 basis:

Office equipment
-
20%

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.

 
2.9

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 reporting 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.

 
2.10

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 16

 
TUFAIL CHEMICALS UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

2.Accounting policies (continued)

 
2.11

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. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

In the Statement of Cash Flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Company's cash management.

 
2.12

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.

 
2.13

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.

The Company has elected to apply the recognition and measurement provisions of IFRS 9 Financial Instruments (as adopted by the UK Endorsement Board) with the disclosure requirements of Sections 11 and 12 and the other presentation requirements of FRS 102.

Financial instruments are recognised in the Company's Statement of Financial Position 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.

Other financial assets

Other financial assets, which includes investments in equity instruments which are not classified as subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the recognised transaction price. Such assets are subsequently measured at fair value with the changes in fair value being recognised in the profit or loss. Where other financial assets are not publicly traded, hence their fair value cannot be measured reliably, they are measured at cost less impairment.

Page 17

 
TUFAIL CHEMICALS UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

2.Accounting policies (continued)


2.13
Financial instruments (continued)

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.

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.

Other financial instruments

Derivatives, including forward exchange contracts, futures contracts and interest rate swaps, are not classified as basic financial instruments. These are initially recognised at fair value on the date the derivative contract is entered into, with costs being charged to the profit or loss. They are subsequently measured at fair value with changes in the profit or loss.

Debt instruments that do not meet the conditions as set out in FRS 102 paragraph 11.9 are subsequently measured at fair value through the profit or loss. This recognition and measurement would also apply to financial instruments where the performance is evaluated on a fair value basis as with a documented risk management or investment strategy.

Derecognition of financial instruments

Derecognition of financial assets

Page 18

 
TUFAIL CHEMICALS UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

2.Accounting policies (continued)


2.13
Financial instruments (continued)

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.


3.


Judgments in applying accounting policies and key sources of estimation uncertainty

Estimates and judgements are continually evaluated and are based on historic experience and other
factors, including expectations of future events that are believed to be reasonable under the circumstances.
Key sources of estimation uncertainty
The estimates and assumptions that have a risk of causing adjustment to the carrying amounts of assets and liabilities within the next financial year are outlined below:
Useful economic lives of tangible fixed assets
The annual depreciation charge for tangible assets is sensitive to changes in the estimated useful economic lives and residual values of the assets. The useful economic lives and residual values are reassessed annually. They are amended when necessary to reflect current estimates, based on technological advancement, future investments, economic utilisation and physical condition of the assets.


4.


Turnover

An analysis of turnover by class of business is as follows:


2023
2022
£
£

Sale of industrial chemicals
4,647,705
2,941,986

4,647,705
2,941,986


All turnover arose within the rest of the world.

Page 19

 
TUFAIL CHEMICALS UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

5.


Operating profit/(loss)

The operating profit/(loss) is stated after charging:

2023
2022
£
£

Exchange differences
(14,336)
5,744

Other operating lease rentals
936
4,940


6.


Auditors' remuneration

During the year, the Company obtained the following services from the Company's auditors and their associates:


2023
2022
£
£

Fees payable to the Company's auditors and their associates for the audit of the Company's financial statements
3,600
3,600


7.


Employees

Staff costs, including directors' remuneration, were as follows:


2023
2022
£
£

Wages and salaries
95,420
70,500

Social security costs
11,770
5,039

107,190
75,539


The average monthly number of employees, including the directors, during the year was as follows:


        2023
        2022
            No.
            No.







Management
2
2

Page 20

 
TUFAIL CHEMICALS UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

8.


Directors' remuneration

2023
2022
£
£

Directors' emoluments
95,420
70,500

95,420
70,500



9.


Interest payable and similar expenses

2023
2022
£
£


Bank interest payable
51
-

51
-


10.


Taxation


2023
2022
£
£

Corporation tax


Current tax on profits for the year
1,855
-


1,855
-


Total current tax
1,855
-

Deferred tax

Total deferred tax
-
-


Tax on profit/(loss)
1,855
-
Page 21

 
TUFAIL CHEMICALS UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
 
10.Taxation (continued)


Factors affecting tax charge for the year

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

2023
2022
£
£


Profit/(loss) on ordinary activities before tax
197,340
(117,426)


Profit/(loss) on ordinary activities multiplied by standard rate of corporation tax in the UK of 19% (2022 - 19%)
37,495
(22,311)

Effects of:


Capital allowances for year in excess of depreciation
46
46

Utilisation of tax losses
(35,686)
-

Unrelieved tax losses carried forward
-
22,265

Total tax charge for the year
1,855
-


Factors that may affect future tax charges

The standard rate of tax applied to reported profit on ordinary activities is 19% (2022: 19%). In the Finance
Bill 2021, the Government announced that from 1 April 2023 the corporation tax rate would increase to
25%. The Finance Bill 2021 and the new 25% rate were substantially enacted on 24th May 2021, this
means that the 25% main rate of corporation tax and marginal relief will be relevant for any timing
differences expected to reverse on or after 1 April 2023.

Page 22

 
TUFAIL CHEMICALS UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

11.


Tangible fixed assets





Office equipment

£



Cost or valuation


At 1 July 2022
1,299



At 30 June 2023

1,299



Depreciation


At 1 July 2022
560


Charge for the year on owned assets
240



At 30 June 2023

800



Net book value



At 30 June 2023
499



At 30 June 2022
739


12.


Stocks

2023
2022
£
£

Finished goods and goods for resale
268,603
675,340

268,603
675,340



13.


Debtors

2023
2022
£
£


Trade debtors
190,584
-

Amounts owed by group undertakings
525,969
227,865

Other debtors
1,239
3,100

Prepayments and accrued income
13,278
1,214

731,070
232,179


Page 23

 
TUFAIL CHEMICALS UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

14.


Cash and cash equivalents

2023
2022
£
£

Cash at bank and in hand
262,216
169,738

Less: bank overdrafts
(164,754)
(624,853)

97,462
(455,115)



15.


Creditors: Amounts falling due within one year

2023
2022
£
£

Bank loan and overdrafts
164,754
624,853

Trade creditors
3,918
4,888

Amounts owed to group undertakings
896,134
167,984

Corporation tax
1,855
-

Other taxation and social security
4,834
4,459

Other creditors
70,634
7,019

Accruals and deferred income
111,752
455,771

1,253,881
1,264,974


The following liabilities were secured:

2023
2022
£
£



Bank loan and overdrafts
164,754
624,853

164,754
624,853

Details of security provided:

The loan is secured by HBL Bank UK Limited by way of fixed and floating charge on all the property or undertaking of the company. The charge contains negative pledge.
Tufail Chemical Industries Limited i.e., the parent Company has provided letter of comfort to the bankers of the company as security whereby the parent company confirms, agrees, and undertakes that it will ensure and/or procure that all the terms of, and the liabilities of the company arising under current and future financing facilities are met in full.

Page 24

 
TUFAIL CHEMICALS UK LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023

16.


Financial instruments

2023
2022
£
£

Financial assets


Financial assets measured at fair value through profit or loss
262,216
169,738




17.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



100 (2022 - 100) Ordinary shares of £1.0 each
100
100



18.


Related party transactions

Tufail Chemicals Industries Limited (Parent company) owns 100% of issued share capital in the company. At the year end the company owed £299,116 (2022: £167,984) to its parent company.
The company charged commission of £359,224 to its parent company and at the year end, parent company owed £359,224.
Tufail Multichemical Industries Ltd (TMIL) is a connected company. At the year end the, company owed net balance of £265,519 to TMIL.
The balances are repayble on demand and there is no interest due.


19.


Controlling party

The company is under the control of Tufail Chemicals Industries Limited, a company incorporated in Pakistan. The parent company owns 100% of issued share capital in the company.

 
Page 25