Company registration number 05113241 (England and Wales)
LA MICRO GROUP UK LTD
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2023
LA MICRO GROUP UK LTD
COMPANY INFORMATION
Director
David Bell
Company number
05113241
Registered office
Astro House
Unit 2 Brants Bridge
Bracknell
Berkshire
RG12 9BG
Auditor
M J Bushell Audit LLP
8 High Street
Brentwood
Essex
CM14 4AB
LA MICRO GROUP UK LTD
CONTENTS
Page
Strategic report
1
Director's report
2
Director's responsibilities statement
3
Independent auditor's report
4 - 6
Profit and loss account
7
Statement of comprehensive income
8
Balance sheet
9
Statement of changes in equity
10
Statement of cash flows
11
Notes to the financial statements
12 - 24
LA MICRO GROUP UK LTD
STRATEGIC REPORT
FOR THE YEAR ENDED 31 OCTOBER 2023
- 1 -

The director presents the strategic report for the year ended 31 October 2023.

Review of the business

The beginning of the fiscal year has presented significant challenges across the industry, with the lingering effects of the Covid-19 pandemic being a primary concern. These challenges have included disrupted supply chains and fluctuating demand. Despite these obstacles, the industry is showing signs of recovery and adaptation.

The company has demonstrated resilience in the face of industry-wide difficulties, achieving a notable increase in gross profit by 7.2%. This growth indicates strong operational efficiency and effective cost management strategies that have been implemented over the period.

A key factor contributing to the improved financial performance is the decrease in the cost of sales. This reduction is largely due to a scarcity of products in the market, which has allowed the company to sell existing inventory at higher prices. The limited availability of products has worked to the company's advantage, enhancing profit margins.

The loyalty and robustness of our client base have been instrumental in driving net profit growth. Despite the broader industry challenges, our customer retention strategies have been effective, resulting in a significant increase in net profits by 54.6%. This substantial growth underscores the strength of our brand and the value we provide to our customers

On behalf of the board

David Bell
Director
29 July 2024
LA MICRO GROUP UK LTD
DIRECTOR'S REPORT
FOR THE YEAR ENDED 31 OCTOBER 2023
- 2 -

The director presents his annual report and financial statements for the year ended 31 October 2023.

Principal activities

The principal activity of the company continued to be that of sourcing and supply of refurbished IT hardware.

Results and dividends

The results for the year are set out on page 7.

No ordinary dividends were paid. The director does not recommend payment of a final dividend.

Director

The director who held office during the year and up to the date of signature of the financial statements was as follows:

David Bell
Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.

Medium-sized companies exemption

This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.

On behalf of the board
David Bell
Director
29 July 2024
LA MICRO GROUP UK LTD
DIRECTOR'S RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 OCTOBER 2023
- 3 -

The director is responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless he is 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 director is required to:

 

 

The director is 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. He is 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.

LA MICRO GROUP UK LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF LA MICRO GROUP UK LTD
- 4 -
Opinion

We have audited the financial statements of LA Micro Group UK Ltd (the 'company') for the year ended 31 October 2023 which comprise the profit and loss account, the statement of comprehensive income, the balance sheet, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the 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 financial statements are authorised for issue.

 

Our responsibilities and the responsibilities of the director with respect to going concern are described in the relevant sections of this report.

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The director is responsible for the other information contained within the annual report. 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. 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.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of our audit:

LA MICRO GROUP UK LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF LA MICRO GROUP UK LTD
- 5 -
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 director's 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:

Responsibilities of director

As explained more fully in the director's responsibilities statement, the director is 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 director determines 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 director is 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 director either intends to liquidate the company or to cease operations, or has no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

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

Management override of controls
Non compliance with laws and regulations

 

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

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.

LA MICRO GROUP UK LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF LA MICRO GROUP UK LTD
- 6 -
Corné von Wielligh ACA
Senior Statutory Auditor
For and on behalf of M J Bushell Audit LLP
30 July 2024
Chartered Accountants
Statutory Auditor
8 High Street
Brentwood
Essex
CM14 4AB
LA MICRO GROUP UK LTD
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 OCTOBER 2023
- 7 -
2023
2022
Notes
£
£
Turnover
3
37,324,865
39,120,910
Cost of sales
(27,652,747)
(30,102,811)
Gross profit
9,672,118
9,018,099
Administrative expenses
(8,921,489)
(8,499,580)
Operating profit
4
750,629
518,519
Interest receivable and similar income
7
3,565
5,661
Interest payable and similar expenses
8
(97,894)
(36,191)
Profit before taxation
656,300
487,989
Tax on profit
9
(137,358)
(152,444)
Profit for the financial year
518,942
335,545

The profit and loss account has been prepared on the basis that all operations are continuing operations.

LA MICRO GROUP UK LTD
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 OCTOBER 2023
- 8 -
2023
2022
£
£
Profit for the year
518,942
335,545
Other comprehensive income
-
-
Total comprehensive income for the year
518,942
335,545
LA MICRO GROUP UK LTD
BALANCE SHEET
AS AT
31 OCTOBER 2023
31 October 2023
- 9 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
10
274,702
306,745
Investments
11
60
60
274,762
306,805
Current assets
Stocks
13
4,675,575
4,907,240
Debtors
14
3,722,912
5,093,351
Cash at bank and in hand
1,736,628
1,324,581
10,135,115
11,325,172
Creditors: amounts falling due within one year
15
(5,773,096)
(6,858,898)
Net current assets
4,362,019
4,466,274
Total assets less current liabilities
4,636,781
4,773,079
Creditors: amounts falling due after more than one year
16
(716,672)
(1,371,912)
Provisions for liabilities
Deferred tax liability
19
48,042
48,042
(48,042)
(48,042)
Net assets
3,872,067
3,353,125
Capital and reserves
Called up share capital
22
2
2
Profit and loss reserves
3,872,065
3,353,123
Total equity
3,872,067
3,353,125

These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.

The financial statements were approved and signed by the director and authorised for issue on 29 July 2024
David  Bell
Director
Company registration number 05113241 (England and Wales)
LA MICRO GROUP UK LTD
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 OCTOBER 2023
- 10 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 November 2021
2
3,017,578
3,017,580
Year ended 31 October 2022:
Profit and total comprehensive income
-
335,545
335,545
Balance at 31 October 2022
2
3,353,123
3,353,125
Year ended 31 October 2023:
Profit and total comprehensive income
-
518,942
518,942
Balance at 31 October 2023
2
3,872,065
3,872,067
LA MICRO GROUP UK LTD
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 OCTOBER 2023
- 11 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
25
991,695
723,789
Interest paid
(97,894)
(36,191)
Income taxes paid
(24,160)
(264,494)
Net cash inflow from operating activities
869,641
423,104
Investing activities
Purchase of tangible fixed assets
(98,823)
(76,114)
Proceeds from disposal of tangible fixed assets
(1)
4,093
Proceeds from disposal of subsidiaries
-
0
1
Repayment of loans
(16,178)
429
Interest received
3,565
5,661
Net cash used in investing activities
(111,437)
(65,930)
Financing activities
Repayment of bank loans
(335,508)
(287,109)
Payment of finance leases obligations
(10,649)
(10,111)
Net cash used in financing activities
(346,157)
(297,220)
Net increase in cash and cash equivalents
412,047
59,954
Cash and cash equivalents at beginning of year
1,324,581
1,264,627
Cash and cash equivalents at end of year
1,736,628
1,324,581
LA MICRO GROUP UK LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2023
- 12 -
1
Accounting policies
Company information

LA Micro Group UK Ltd is a private company limited by shares incorporated in England and Wales. The registered office is Astro House, Unit 2 Brants Bridge, Bracknell, Berkshire, RG12 9BG.

1.1
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

1.2
Going concern

Atruet the time of approving the financial statements, the director has a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the director continues to adopt the going concern basis of accounting in preparing the financial statements.

1.3
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

 

When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

1.4
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Fixtures and fittings
25% reducing balance
Computers
25% straight line
Motor vehicles
25% 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.

LA MICRO GROUP UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
1
Accounting policies
(Continued)
- 13 -
1.5
Fixed asset investments

Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.

A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The company considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.

Entities in which the company has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

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.

 

Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

LA MICRO GROUP UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
1
Accounting policies
(Continued)
- 14 -
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.

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.

Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

LA MICRO GROUP UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
1
Accounting policies
(Continued)
- 15 -
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.

Other financial liabilities

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Derecognition of financial liabilities

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

1.10
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
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

LA MICRO GROUP UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
1
Accounting policies
(Continued)
- 16 -
Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

1.12
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.

1.13
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.14
Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

 

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.

1.15
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

LA MICRO GROUP UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 17 -
2
Judgements and key sources of estimation uncertainty

In the application of the company’s accounting policies, the director is required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
7,465,782
13,297,048
Rest of Europe
18,363,002
9,409,234
Rest of the world
11,496,081
16,414,628
37,324,865
39,120,910
2023
2022
£
£
Other revenue
Interest income
3,565
5,661
4
Operating profit
2023
2022
Operating profit for the year is stated after charging:
£
£
Exchange losses
34,987
181,583
Fees payable to the company's auditor for the audit of the company's financial statements
27,950
21,525
Depreciation of owned tangible fixed assets
126,577
109,513
Loss on disposal of tangible fixed assets
4,290
39,659
Operating lease charges
198,842
166,667
5
Employees

The average monthly number of persons (including directors) employed by the company during the year was:

2023
2022
Number
Number
69
63
LA MICRO GROUP UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
5
Employees
(Continued)
- 18 -

Their aggregate remuneration comprised:

2023
2022
£
£
Wages and salaries
6,106,757
5,917,185
Social security costs
704,023
619,304
Pension costs
99,925
97,173
6,910,705
6,633,662
6
Director's remuneration
2023
2022
£
£
Remuneration for qualifying services
230,679
276,104
Company pension contributions to defined contribution schemes
6,325
4,742
237,004
280,846
Remuneration disclosed above include the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
230,679
276,104
Company pension contributions to defined contribution schemes
6,325
4,742

During the year retirement benefits were accruing to 1 directors (year ended 31 October 2022 - 1) in respect of defined contribution pension schemes.

 

The value of the group's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to £6,325 (2022:£4,742)

7
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
3,565
3,533
Other interest income
-
0
2,128
Total income
3,565
5,661
LA MICRO GROUP UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
7
Interest receivable and similar income
(Continued)
- 19 -
2023
2022
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
3,565
3,533
8
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
93,172
34,332
Other finance costs:
Interest on finance leases and hire purchase contracts
1,321
1,859
Other interest
3,401
-
0
97,894
36,191
9
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
182,360
152,444
Adjustments in respect of prior periods
(45,002)
-
0
Total current tax
137,358
152,444

The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:

2023
2022
£
£
Profit before taxation
656,300
487,989
Expected tax charge based on the standard rate of corporation tax in the UK of 22.50% (2022: 19.00%)
147,668
92,718
Tax effect of expenses that are not deductible in determining taxable profit
58,114
64,511
Adjustments in respect of prior years
(39,505)
-
0
Permanent capital allowances in excess of depreciation
(29,884)
(12,320)
Loss on sale of fixed asset
965
7,535
Taxation charge for the year
137,358
152,444
LA MICRO GROUP UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 20 -
10
Tangible fixed assets
Fixtures and fittings
Computers
Motor vehicles
Total
£
£
£
£
Cost
At 1 November 2022
221,036
441,936
202,544
865,516
Additions
424
98,399
-
0
98,823
Disposals
(8,940)
-
0
-
0
(8,940)
At 31 October 2023
212,520
540,335
202,544
955,399
Depreciation and impairment
At 1 November 2022
105,774
370,101
82,896
558,771
Depreciation charged in the year
39,405
64,994
22,178
126,577
Eliminated in respect of disposals
(4,651)
-
0
-
0
(4,651)
At 31 October 2023
140,528
435,095
105,074
680,697
Carrying amount
At 31 October 2023
71,992
105,240
97,470
274,702
At 31 October 2022
115,262
71,835
119,648
306,745

The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.

2023
2022
£
£
Motor vehicles
35,573
37,120
11
Fixed asset investments
2023
2022
Notes
£
£
Investments in subsidiaries
12
60
60
12
Subsidiaries

Details of the company's subsidiaries at 31 October 2023 are as follows:

Name of undertaking
Registered office
Class of
% Held
shares held
Direct
LA Micro (Brokerage) Limited
Astro House, Unit 2 Brants Bridge, Bracknell, Berkshire, England, RG12 9BG
Ordinairy
60.00
LA MICRO GROUP UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 21 -
13
Stocks
2023
2022
£
£
Finished goods and goods for resale
4,675,575
4,907,240

An impairment loss of £1,105,615 (year ended 31 October 2022 - £456,310) was recognised in cost of sales against stock during the year due to slow-moving and obsolete stock.

14
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
2,943,228
3,770,760
Other debtors
599,987
374,362
Prepayments and accrued income
179,697
948,229
3,722,912
5,093,351
15
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Bank loans
17
2,218,236
1,909,690
Obligations under finance leases
18
11,186
10,649
Trade creditors
2,103,173
2,602,972
Corporation tax
275,346
162,148
Other taxation and social security
269,696
466,179
Deferred income
20
-
0
91,279
Other creditors
143,421
526,616
Accruals and deferred income
752,038
1,089,365
5,773,096
6,858,898
16
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Bank loans and overdrafts
17
705,946
1,350,000
Obligations under finance leases
18
10,726
21,912
716,672
1,371,912
LA MICRO GROUP UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 22 -
17
Loans and overdrafts
2023
2022
£
£
Bank loans
2,924,182
3,259,690
Payable within one year
2,218,236
1,909,690
Payable after one year
705,946
1,350,000

Bank loans and overdrafts are secured by a fixed charge over all the assets of LA Micro Group (UK) Limited and a pledge over the goods to which the loan relates to.

Obligations under finance lease and hire purchase contracts are secured against the assets they relate to.

18
Finance lease obligations
2023
2022
Future minimum lease payments due under finance leases:
£
£
Within one year
10,649
10,649
In two to five years
11,263
21,912
21,912
32,561
19
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:

Liabilities
Liabilities
2023
2022
Balances:
£
£
Accelerated capital allowances
48,042
48,042
There were no deferred tax movements in the year.

The deferred tax liability set out above is expected to reverse by £5,000 within the next 12 months and relates to accelerated capital allowances that are expected to mature within the same period.

20
Deferred income
2023
2022
£
£
Other deferred income
-
91,279
LA MICRO GROUP UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 23 -
21
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
99,925
97,173

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.

22
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary of £1 each
2
2
2
2
23
Operating lease commitments
Lessee

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

2023
2022
£
£
Within one year
150,667
150,667
Between two and five years
602,667
238,556
In over five years
389,222
-
0
1,142,556
389,223
24
Related party transactions
Transactions with related parties

During the year the company entered into the following transactions with related parties:

Sales
Sales
2023
2022
£
£
Other related parties
1,056,332
1,770,664
2023
2022
Amounts due to related parties
£
£
Other related parties
27,461
-
LA MICRO GROUP UK LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 24 -
25
Cash generated from operations
2023
2022
£
£
Profit for the year after tax
518,942
335,545
Adjustments for:
Taxation charged
137,358
152,444
Finance costs
97,894
36,191
Investment income
(3,565)
(5,661)
Loss on disposal of tangible fixed assets
4,290
39,659
Depreciation and impairment of tangible fixed assets
126,577
109,513
Movements in working capital:
Decrease in stocks
231,665
949,756
Decrease/(increase) in debtors
1,386,617
(1,364,607)
(Decrease)/increase in creditors
(1,416,804)
379,670
(Decrease)/increase in deferred income
(91,279)
91,279
Cash generated from operations
991,695
723,789
26
Analysis of changes in net debt
1 November 2022
Cash flows
31 October 2023
£
£
£
Cash at bank and in hand
1,324,581
412,047
1,736,628
Borrowings excluding overdrafts
(3,259,690)
335,508
(2,924,182)
Obligations under finance leases
(32,561)
10,649
(21,912)
(1,967,670)
758,204
(1,209,466)
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