Registration number:
Herti UK Limited
for the Year Ended 31 December 2023
Herti UK Limited
Contents
Company Information |
|
Statement of Directors' Responsibilities |
|
Independent Auditor's Report |
|
Directors' Report |
|
Statement of Income and Retained Earnings |
|
Statement of Financial Position |
|
Statement of Cash Flows |
|
Notes to the Financial Statements |
Herti UK Limited
Company Information
Directors |
Z Zahariev P Zahariev |
Company secretary |
Z Zahariev |
Registered office |
|
Auditors |
|
Herti UK Limited
Statement of Directors' Responsibilities
The directors acknowledge their responsibilities for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
• |
select suitable accounting policies and apply them consistently; |
• |
make judgements and accounting estimates that are reasonable and prudent; |
• |
state whether applicable United Kingdom Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and |
• |
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business. |
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Herti UK Limited
Independent Auditor's Report to the Members of Herti UK Limited
Opinion
We have audited the financial statements of Herti UK Limited (the 'company') for the year ended 31 December 2023, which comprise the Statement of Income and Retained Earnings, Statement of Financial Position, Statement of Cash Flows, and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion, the financial statements:
• | give a true and fair view of the state of the company's affairs as at 31 December 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 responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the director's 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 original financial statements were 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 directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and in doing so, consider whether the other information is materially inconsistent with the financial statements, or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of other information. If based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Herti UK Limited
Independent Auditor's Report to the Members of Herti UK Limited
Opinion on other matter 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 our 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 where the Companies Act 2006 requires us to report to you if, in our opinion:
• | 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. |
• |
the directors were not entitled to take advantage of the small companies exemption in preparing the directors' report and from the requirement to prepare a strategic report. |
Responsibilities of directors
As explained more fully in the Statement of Directors' Responsibilities [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.
Auditor 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:
Herti UK Limited
Independent Auditor's Report to the Members of Herti UK Limited
In identifying and assessing the risks of material misstatement in respect of irregularities, including fraud, we have obtained an understanding of the nature of the industry, the control environment and the legal and regulatory frameworks that the company operates in.
We determined that the most significant applicable legal and regulatory frameworks are those directly relevant to the reporting framework and preparation of the financial statements (FRS 102, Companies Act 2006 and UK tax legislation). We considered the extent to which non-compliance might have a material effect on the financial statements.
We determined the principal risks which could lead to material misstatement of the financial statements to be related to posting inappropriate journal entries and management bias in accounting estimates. We consider there to be no significant risks in respect of accounting estimates.
Audit procedures performed by the engagement team included:
• |
Identifying those members of the Company who have the primary responsibility for ensuring compliance with laws and regulations; |
• |
Enquiries with management, to understand managements’ approach to ensuring compliance with laws and regulations, and to obtain knowledge of any non-compliance or potential non-compliance with laws and regulations that could affect the financial statements; |
• |
Evaluating managements’ incentives and opportunities for manipulation of the financial statements (including management override of controls); |
• |
Testing journal entries and performing analytical procedures to identify any unusual transactions, or those outside the normal course of business, which may indicate risks of material misstatement due to fraud; |
• |
Testing of balances and transactions that are subject to estimation uncertainty by review of evidence supporting the assumptions and judgements used, and determining whether those judgements used indicate potential bias; |
• |
Review of legal expense accounts to identify spend which may be indicative of breaches of laws and regulations; |
• |
Reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with the provisions of laws and regulations described above. |
The engagement team also remained aware of the need for professional scepticism to identify any indications of fraud or non-compliance with laws and regulations throughout the audit.
There are inherent limitations in the audit procedures described above and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. The risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
Herti UK Limited
Independent Auditor's Report to the Members of Herti UK Limited
Use of our report:
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
......................................
For and on behalf of
Knoll House
Knoll Road
Surrey
GU15 3SY
Herti UK Limited
Directors' Report for the Year Ended 31 December 2023
The directors present their report and the financial statements for the year ended 31 December 2023.
Principal activity
The principal activity of the company is distributing of products made by the parent company, Herti JSC.
Directors of the company
The directors who held office during the year were as follows:
Disclosure of information to the auditors
Each director has taken steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditors are aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditors are unaware.
Small companies provision statement
This report has been prepared in accordance with the small companies regime under the Companies Act 2006.
Approved and authorised by the
......................................... |
Herti UK Limited
Statement of Income and Retained Earnings for the Year Ended 31 December 2023
Note |
2023 |
2022 |
|
Turnover |
|
|
|
Cost of sales |
( |
( |
|
Gross profit |
|
|
|
Administrative expenses |
( |
( |
|
Operating profit |
|
|
|
Interest payable and similar charges |
- |
( |
|
- |
(12) |
||
Profit before tax |
|
|
|
Taxation |
( |
( |
|
Profit for the financial year |
|
|
|
Retained earnings brought forward |
163,662 |
97,681 |
|
Retained earnings carried forward |
285,702 |
163,662 |
Herti UK Limited
(Registration number: 06186409)
Statement of Financial Position as at 31 December 2023
Note |
2023 |
2022 |
|
Fixed assets |
|||
Tangible assets |
|
|
|
Current assets |
|||
Stocks |
|
|
|
Debtors |
|
|
|
Cash at bank and in hand |
|
|
|
|
|
||
Creditors: Amounts falling due within one year |
( |
( |
|
Net current assets |
|
|
|
Net assets |
|
|
|
Capital and reserves |
|||
Called up share capital |
|
|
|
Profit and loss account |
|
|
|
Shareholders' funds |
|
|
Approved and authorised by the
......................................... |
Herti UK Limited
Statement of Cash Flows for the Year Ended 31 December 2023
Note |
2023 |
2022 |
|
Cash flows from operating activities |
|||
Profit for the year |
|
|
|
Adjustments to cash flows from non-cash items |
|||
Depreciation and amortisation |
|
|
|
Finance costs |
- |
|
|
Income tax expense |
|
|
|
|
|
||
Working capital adjustments |
|||
Increase in stocks |
( |
( |
|
(Increase)/decrease in trade debtors |
( |
|
|
Increase/(decrease) in trade creditors |
|
( |
|
Cash generated from operations |
|
|
|
Income taxes paid |
( |
( |
|
Net cash flow from operating activities |
|
|
|
Cash flows from investing activities |
|||
Acquisitions of tangible assets |
( |
- |
|
Cash flows from financing activities |
|||
Interest paid |
- |
( |
|
Net increase in cash and cash equivalents |
|
|
|
Cash and cash equivalents at 1 January |
|
|
|
Cash and cash equivalents at 31 December |
207,213 |
74,105 |
Herti UK Limited
Notes to the Financial Statements for the Year Ended 31 December 2023
General information |
The company is a private company limited by share capital, incorporated in England and Wales.
The address of its registered office is:
United Kingdom
These financial statements were authorised for issue by the
Accounting policies |
Summary of significant accounting policies and key accounting estimates
The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.
Statement of compliance
These financial statements were prepared in accordance with Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland and the Companies Act 2006'.
Basis of preparation
These financial statements have been prepared using the historical cost convention except that as disclosed in the accounting policies certain items are shown at fair value.
The financial statements are prepared in sterling, which is the functional currency of the entity.
Exemption from preparing group accounts
The financial statements contain information about Herti UK Limited as an individual company and do not contain consolidated financial information as the parent of a group.
The company is exempt under section 401 of the Companies Act 2006 from the requirement to prepare consolidated financial statements as it and its subsidiary undertakings are included by full consolidation in the consolidated financial statements of its parent, Herti JSC, a company incorporated in Bulgaria.
Judgements
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported. These estimates and judgements are continually reviewed and are based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. It is the opinion of the directors that due to the nature of the entity there are no assumptions or judgements that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year. |
Revenue recognition
Turnover comprises the fair value of the consideration received or receivable for the sale of goods and provision of services in the ordinary course of the company’s activities. Turnover is shown net of value added tax, returns, rebates and discounts.
The company recognises revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits will flow to the entity and specific criteria have been met for each of the company's activities.
Herti UK Limited
Notes to the Financial Statements for the Year Ended 31 December 2023
Foreign currency transactions and balances
Tax
The tax expense for the period comprises current tax. Tax is recognised in profit or loss, except that a change attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.
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 taxable income.
Tangible assets
Tangible assets are stated in the statement of financial position at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.
The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.
Depreciation
Depreciation is charged so as to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:
Asset class |
Depreciation method and rate |
Plant and machinery |
33.3% reducing balance |
Office equipment |
25% reducing balance |
Goodwill
Goodwill arising on the acquisition of an entity represents the excess of the cost of acquisition over the company’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the entity recognised at the date of acquisition. Goodwill is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is held in the currency of the acquired entity and revalued to the closing rate at each reporting period date. Goodwill is amortised over its useful life, which shall not exceed ten years if a reliable estimate of the useful life cannot be made.
Amortisation
Amortisation is provided on intangible assets so as to write off the cost, less any estimated residual value, over their useful life as follows:
Asset class |
Amortisation method and rate |
Goodwill |
10% straight line |
Cash and cash equivalents
Cash is represented by cash in hand and bank deposits.
Trade debtors
Short term debtors are measured at transaction price, less any impairment.
Herti UK Limited
Notes to the Financial Statements for the Year Ended 31 December 2023
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost is determined using the first-in, first-out (FIFO) method.
The cost of finished goods and work in progress comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the inventories to their present location and condition. At each reporting date, stocks are assessed for impairment. If stocks are 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.
Trade creditors
Short term creditors are measured at the transaction price.
Share capital
Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.
Defined contribution pension obligation
A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the company has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.
Contributions to defined contribution plans are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.
Financial instruments
Recognition and measurement
Herti UK Limited
Notes to the Financial Statements for the Year Ended 31 December 2023
Revenue |
The principal activity of the company is that of distributing products manufactured by its parent company.
The turnover is derived from classes of business and geographical markets that substantially differ from each other. An analysis of each is given below:
Geographical markets
2023 |
2022 |
|
UK |
|
|
Rest of world |
|
|
|
|
Business classes
2023 |
2022 |
|
Product sales |
|
|
Delivery and carriage |
|
|
|
|
Operating profit |
Arrived at after charging/(crediting)
2023 |
2022 |
|
Depreciation expense |
|
|
Cost of stocks recognised as an expense |
4,872,075 |
3,903,243 |
Impairment of trade debtors |
- |
25,641 |
Foreign exchange losses/(gains) |
|
( |
Auditor's remuneration - The audit of the company's annual accounts |
9,160 |
7,800 |
Interest payable and similar expenses |
2023 |
2022 |
|
Interest on bank overdrafts and borrowings |
- |
|
Herti UK Limited
Notes to the Financial Statements for the Year Ended 31 December 2023
Staff costs |
The aggregate payroll costs (including directors' remuneration) were as follows:
2023 |
2022 |
|
Wages and salaries |
|
|
Social security costs |
|
|
Pension costs, defined contribution scheme |
|
|
|
|
The average number of persons employed by the company (including directors) during the year, analysed by category was as follows:
2023 |
2022 |
|
Administration and support |
|
|
|
|
Directors' remuneration |
The directors' remuneration for the year was as follows:
2023 |
2022 |
|
Remuneration |
|
|
Company contributions to pension schemes in respect of qualifying services |
|
|
73,971 |
60,439 |
Auditors' remuneration |
2023 |
2022 |
|
Audit of the financial statements |
|
|
Other fees to auditors |
||
All other non-audit services |
|
|
Herti UK Limited
Notes to the Financial Statements for the Year Ended 31 December 2023
Taxation |
Tax charged/(credited) in the income statement
2023 |
2022 |
|
Current taxation |
||
UK corporation tax |
|
|
The tax on profit before tax for the year is lower than the standard rate of corporation tax in the UK (2022 - lower than the standard rate of corporation tax in the UK) of
The differences are reconciled below:
2023 |
2022 |
|
Profit before tax |
|
|
Corporation tax at standard rate |
|
|
Effect of expense not deductible in determining taxable profit (tax loss) |
( |
- |
Tax increase from effect of capital allowances and depreciation |
|
|
Other tax effects for reconciliation between accounting profit and tax expense (income) |
( |
- |
Total tax charge |
|
|
Intangible assets |
Goodwill |
Total |
|
Cost or valuation |
||
At 1 January 2023 |
|
|
At 31 December 2023 |
|
|
Amortisation |
||
At 1 January 2023 |
|
|
At 31 December 2023 |
|
|
Carrying amount |
||
At 31 December 2023 |
- |
- |
The above goodwill has been amortised over a useful life of 10 years. The useful life of the goodwill is linked to the associated established customer relationships and contacts.
Herti UK Limited
Notes to the Financial Statements for the Year Ended 31 December 2023
Tangible assets |
Office equipment |
Plant and machinery |
Total |
|
Cost or valuation |
|||
At 1 January 2023 |
|
|
|
Additions |
|
- |
|
At 31 December 2023 |
|
|
|
Depreciation |
|||
At 1 January 2023 |
|
|
|
Charge for the year |
|
|
|
At 31 December 2023 |
|
|
|
Carrying amount |
|||
At 31 December 2023 |
|
|
|
At 31 December 2022 |
|
|
|
Stocks |
2023 |
2022 |
|
Finished goods and goods for resale |
|
|
Debtors |
Current |
2023 |
2022 |
Trade debtors |
|
|
Prepayments |
|
|
|
|
Cash and cash equivalents |
2023 |
2022 |
|
Cash at bank |
|
|
Herti UK Limited
Notes to the Financial Statements for the Year Ended 31 December 2023
Creditors |
Note |
2023 |
2022 |
|
Due within one year |
|||
Trade creditors |
|
|
|
Amounts due to related parties |
|
|
|
Social security and other taxes |
|
|
|
Accruals |
|
|
|
|
|
Pension and other schemes |
Defined contribution pension scheme
The company operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the company to the scheme and amounted to £
Share capital |
Allotted, called up and fully paid shares
2023 |
2022 |
|||
No. |
£ |
No. |
£ |
|
|
|
1,000 |
|
1,000 |
Rights, preferences and restrictions
Ordinary shares have the following rights, preferences and restrictions: |
Dividends |
Interim dividends paid
2023 |
2022 |
|||
Interim dividend of £Nil per each |
- |
- |
||
Herti UK Limited
Notes to the Financial Statements for the Year Ended 31 December 2023
Related party transactions |
Key management compensation
2023 |
2022 |
|
Salaries and other short term employee benefits |
|
|
Summary of transactions with parent
Summary of transactions with other related parties
Expenditure with and payables to related parties
2023 |
Parent |
Purchase of goods |
|
Rendering of services |
|
|
|
Amounts payable to related party |
|
|
2022 |
Parent |
Purchase of goods |
|
Rendering of services |
|
|
|
Amounts payable to related party |
|
|
Herti UK Limited
Notes to the Financial Statements for the Year Ended 31 December 2023
Financial instruments |
Categorisation of financial instruments
2023 |
2022 |
|
Financial assets that are debt instruments measured at amortised cost |
|
|
Financial liabilities measured at amortised cost |
( |
( |
The company only has financial assets and financial liabilities of a kind that qualify as basic financial instruments. No transactions have been deferred beyond normal credit terms or financed at non-market rates of interest. The cumulative amortisation on the recognised financial assets and liabilities is £Nil (2022: £Nil).
Parent and ultimate parent undertaking |
The company's immediate parent is
These financial statements are available upon request from Herti JSC, 38 Antim 1 Str., 9700 Shumen, Bulgaria.
Herti JSC is the ultimate parent undertaking and is the parent undertaking of both the largest and smallest group for which group accounts are drawn up and of which the company is a member. The company's owners have the power to amend the financial statements after issue.