Company Registration No. 08099551 (England and Wales)
BALMERS GM LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED
31 OCTOBER 2023
31 October 2023
PM+M Solutions for Business LLP
Chartered Accountants
New Century House
Greenbank Technology Park
Challenge Way
Blackburn
Lancashire
BB1 5QB
BALMERS GM LIMITED
COMPANY INFORMATION
Directors
A Balmer
T Balmer
(Appointed 1 May 2023)
M Balmer
(Appointed 18 October 2023)
J Balmer
(Appointed 18 October 2023)
Company number
08099551
Registered office
c/o PM+M Solutions for Business LLP
First Floor, Sandringham House
Hollins Brook Place, Pilsworth Road
Bury
BL9 8RN
Auditor
PM+M Solutions for Business LLP
New Century House
Greenbank Technology Park
Challenge Way
Blackburn
Lancashire
BB1 5QB
BALMERS GM LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditor's report
5 - 8
Statement of income and retained earnings
9
Balance sheet
10
Notes to the financial statements
11 - 21
BALMERS GM LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 OCTOBER 2023
- 1 -
The directors present the strategic report for the year ended 31 October 2023.
Business Review
Sales for the year amounted to £13,002,340 which compared to the sales from the previous year of £12,278,193, shows an increase of 5.8%
This increase was higher than anticipated, as the pricing from our suppliers has stabilised, but product availability issues continued to be an issue. However, an increase in labour and parts sales during the 2023 year helped to boost the business turnover. We anticipate pricing increase to continue to be stable, and product availability and lead times to return to a more “normal” situation, that would be similar to pre 2020 levels.
Gross margin increased during this period, from 15.6% to 16.9%.
The directors are encouraged by the business performance of the 2023 financial year, and have ensured measures have been put in place to continue with strong results in 2024.
Part way through 2022 the directors put a strong focus on the business’ aftermarket, to provide continued support and service for customers, whilst ensuring profits remain strong. This is a key focus area for growth for the next 3 years. The first year of this plan showed strong financial performance.
In March 2023, the directors took the opportunity to change its main supplier of Woodchippers, from Greenmech to Timberwolf. This strategic decision was made to allow future growth within the Arboriculture / forestry markets, where Timberwolf have a greater market share, which will give us greater exposure to more customers.
Principal risks and uncertainties
The horticultural / turf industry faces several challenges and risks, which can be summarised as being product supply & availability and reduced sales margins to remain competitive against other machinery suppliers. To combat this, the business focus is to become more efficient in the Aftermarket, by retaining stronger profits to counteract the increased pressure on sales margins. Our customers are facing long lead times on many products and have been forced to purchase other brands out of necessity. The directors have been successful in building up a strong portfolio of complimentary products by other manufacturer’s, where lead times have been significantly less.
Financial key performance indicators
Detailed financial monitoring is constantly undertaken. This includes, but is not limited to, review of margins for each department at each branch, monthly management accounts for each branch, stock holding / inventory turn, and monthly review and comparison of Key Performance Indicators both by branch and the company as a whole. The significant KPIs are gross profit rates, labour sales, sales representative performance, transport costs, finance costs, stock holding / inventory turn & administrative expenses.
Financial risk management objectives and policies
The company finances its operations through a mixture of retained profits and, where necessary, to fund expansion or capital expenditure programmes through bank borrowing.
The management's objectives are to:
Retain sufficient liquid funds to enable it to meet its day-to-day obligations as they fall due whilst maximising returns on surplus funds;
Minimise the company's exposure to fluctuating interest rates when seeking new borrowings; and
Match the repayment schedule of any external borrowings or overdrafts with the expected future cash flows expected to arise from the company's trading activities.
During 2021 the company adopted a revised cash management strategy by utilising stock asset finance from Lombard & John Deere Financial. This has resulted in a lower utilisation of the overdraft facility, and has allowed the company to carry more stock (new and used) to cater for the every growing customer base. This has allowed the company to diversify into other areas of the Turf industry by stocking machines from other suppliers, that previously we did not work with.
BALMERS GM LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 2 -
A Balmer
Director
19 July 2024
BALMERS GM LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 OCTOBER 2023
- 3 -
The directors present their 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 the sale, hire and service of horticultural machinery.
Results and dividends
The results for the year are set out on page 9.
Ordinary dividends were paid amounting to £65,000. The directors do not recommend payment of a further dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
D Balmer
(Deceased 29 April 2024)
A Balmer
D Barker
(Resigned 15 November 2023)
T Balmer
(Appointed 1 May 2023)
M Balmer
(Appointed 18 October 2023)
J Balmer
(Appointed 18 October 2023)
Auditor
The auditor, PM+M Solutions for Business LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
Statement of directors' responsibilities
The directors are responsible 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 then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and 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.
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.
BALMERS GM LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 4 -
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
A Balmer
Director
19 July 2024
BALMERS GM LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF BALMERS GM LIMITED
- 5 -
Opinion
We have audited the financial statements of Balmers GM Limited (the 'company') for the year ended 31 October 2023 which comprise the statement of income and retained earnings, the balance sheet 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:
give a true and fair view of the state of the company's affairs as at 31 October 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.
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 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.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual 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:
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.
BALMERS GM LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF BALMERS GM LIMITED
- 6 -
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 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, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Extent to which the audit was considered capable of detecting irregularities, including fraud
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.
BALMERS GM LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF BALMERS GM LIMITED
- 7 -
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 have considered the following:
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;
the matters discussed among the audit engagement team and relevant specialists regarding how and where fraud might occur in the financial statements and any potential indicators of fraud;
any matters we identified having obtained and reviewed the Company's documentation of their policies and procedures relating to:
identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance;
detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud;
the internal controls established to mitigate risks of fraud or non-compliance with laws and regulations.
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 the following areas: timing of recognition of commercial income, posting of unusual journals and complex transactions; and manipulating the Company's performance profit measures and other key performance indicators to meet remuneration targets and externally communicated targets. 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, focusing on provisions of 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 UK Companies Act, employment law, health and safety regulations, pensions legislation and tax legislation.
Audit response to risks identified
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;
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 and reviewing correspondence with HMRC; and
in addressing the identified risks 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.
Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. In addition, as with any audit, there remained a higher risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.
BALMERS GM LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF BALMERS GM LIMITED
- 8 -
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.
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.
Ceri Dixon BSc (Hons) FCA
Senior Statutory Auditor
For and on behalf of PM+M Solutions for Business LLP
19 July 2024
Chartered Accountants
Statutory Auditor
New Century House
Greenbank Technology Park
Challenge Way
Blackburn
Lancashire
BB1 5QB
BALMERS GM LIMITED
STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE YEAR ENDED 31 OCTOBER 2023
- 9 -
2023
2022
Notes
£
£
Turnover
3
13,002,340
12,278,193
Cost of sales
(10,803,122)
(10,362,054)
Gross profit
2,199,218
1,916,139
Administrative expenses
(1,572,287)
(1,346,218)
Operating profit
4
626,931
569,921
Interest payable and similar expenses
7
(32,436)
(20,628)
Profit before taxation
594,495
549,293
Tax on profit
8
(143,767)
(103,810)
Profit for the financial year
450,728
445,483
Retained earnings brought forward
1,077,594
977,111
Dividends
9
(65,000)
(345,000)
Retained earnings carried forward
1,463,322
1,077,594
The profit and loss account has been prepared on the basis that all operations are continuing operations.
The notes on pages 11 to 21 form part of these financial statements.
BALMERS GM LIMITED
BALANCE SHEET
AS AT
31 OCTOBER 2023
31 October 2023
- 10 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
11
1,867,520
2,020,664
Current assets
Stocks
12
3,761,134
3,008,773
Debtors
13
884,048
1,171,959
Cash at bank and in hand
2,713
1,523
4,647,895
4,182,255
Creditors: amounts falling due within one year
14
(3,969,144)
(4,094,764)
Net current assets
678,751
87,491
Total assets less current liabilities
2,546,271
2,108,155
Creditors: amounts falling due after more than one year
15
(629,314)
(553,553)
Provisions for liabilities
Deferred tax liability
18
453,634
477,007
(453,634)
(477,007)
Net assets
1,463,323
1,077,595
Capital and reserves
Called up share capital
20
1
1
Profit and loss reserves
1,463,322
1,077,594
Total equity
1,463,323
1,077,595
The notes on pages 11 to 21 form part of these financial statements.
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.
The financial statements were approved by the board of directors and authorised for issue on 19 July 2024 and are signed on its behalf by:
A Balmer
Director
Company registration number 08099551 (England and Wales)
BALMERS GM LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2023
- 11 -
1
Accounting policies
Company information
Balmers GM Limited is a private company limited by shares incorporated in England and Wales. The registered office is c/o PM+M Solutions for Business LLP, First Floor, Sandringham House, Hollins Brook Place, Pilsworth Road, Bury, BL9 8RN.
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.
This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
Section 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The financial statements of the company are consolidated in the financial statements of Balmers Garden Machinery Holdings Limited. These consolidated financial statements are available from its registered office which is the same as this company as noted on the company information pages.
1.2
Going concern
Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue 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.
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.
BALMERS GM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
1
Accounting policies
(Continued)
- 12 -
1.4
Intangible fixed assets - goodwill
Goodwill represents the excess of the cost of acquisition of unincorporated businesses over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 10 years.
1.5
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:
Leasehold land and buildings
20% straight line
Plant and equipment
10-25% reducing balance
Office equipment
15-25% reducing balance
Motor vehicles
20% reducing balance
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.6
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible 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.
1.7
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
1.8
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
BALMERS GM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
1
Accounting policies
(Continued)
- 13 -
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 measured at transaction price including transaction costs.
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.
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 and bank loans, are recognised at transaction price.
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 at transaction price.
BALMERS GM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
1
Accounting policies
(Continued)
- 14 -
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.
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.
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.
BALMERS GM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
1
Accounting policies
(Continued)
- 15 -
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.
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are 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.
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.
Stock provisions
Stock is valued at the lower of cost and net realisable value. Net realisable value includes, where necessary, provisions for slow moving and obsolete stocks.
3
Turnover
2023
2022
£
£
Turnover analysed by class of business
Sale of horticultural machinery
12,389,779
11,655,579
Hire of horticultural machinery
612,561
622,614
13,002,340
12,278,193
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
13,002,340
12,221,480
Europe
-
56,713
13,002,340
12,278,193
BALMERS GM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 16 -
4
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Fees payable to the company's auditor for the audit of the company's financial statements
12,400
11,800
Depreciation of owned tangible fixed assets
348,995
359,211
Profit on disposal of tangible fixed assets
(146,163)
(151,242)
Amortisation of intangible assets
13,750
Operating lease charges
92,710
98,070
5
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
113,843
82,671
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 4 (2022 - 1).
6
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Admin Staff
31
32
Workshop Staff
21
21
Total
52
53
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
1,890,474
1,855,651
Social security costs
176,909
176,658
Pension costs
36,805
34,947
2,104,188
2,067,256
BALMERS GM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 17 -
7
Interest payable and similar expenses
2023
2022
£
£
Interest on finance leases and hire purchase contracts
32,401
20,628
Other interest
35
32,436
20,628
8
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
167,140
85,679
Deferred tax
Origination and reversal of timing differences
(23,373)
18,131
Total tax charge
143,767
103,810
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
594,495
549,293
Expected tax charge based on the standard rate of corporation tax in the UK of 22.52% (2022: 19.00%)
133,880
104,366
Tax effect of expenses that are not deductible in determining taxable profit
709
1,771
Permanent capital allowances in excess of depreciation
11,512
(6,678)
Remeasurement of deferred tax for changes in tax rates
(2,334)
4,351
Taxation charge for the year
143,767
103,810
9
Dividends
2023
2022
£
£
Final paid
65,000
345,000
BALMERS GM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 18 -
10
Intangible fixed assets
Goodwill
£
Cost
At 1 November 2022 and 31 October 2023
150,000
Amortisation and impairment
At 1 November 2022 and 31 October 2023
150,000
Carrying amount
At 31 October 2023
At 31 October 2022
11
Tangible fixed assets
Leasehold land and buildings
Plant and equipment
Office equipment
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 November 2022
294,326
2,135,946
259,167
728,868
3,418,307
Additions
443,294
5,176
33,875
482,345
Disposals
(460,579)
(60,614)
(521,193)
At 31 October 2023
294,326
2,118,661
264,343
702,129
3,379,459
Depreciation and impairment
At 1 November 2022
222,087
699,349
160,755
315,452
1,397,643
Depreciation charged in the year
21,974
220,775
23,134
83,112
348,995
Eliminated in respect of disposals
(182,319)
(52,380)
(234,699)
At 31 October 2023
244,061
737,805
183,889
346,184
1,511,939
Carrying amount
At 31 October 2023
50,265
1,380,856
80,454
355,945
1,867,520
At 31 October 2022
72,239
1,436,597
98,412
413,416
2,020,664
12
Stocks
2023
2022
£
£
Finished goods and goods for resale
3,761,134
3,008,773
BALMERS GM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 19 -
13
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
722,788
928,672
Other debtors
42,089
33,538
Prepayments and accrued income
119,171
209,749
884,048
1,171,959
14
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Bank loans and overdrafts
16
245,335
350,293
Obligations under finance leases
17
336,797
320,274
Other borrowings
16
418,210
391,842
Trade creditors
1,498,590
1,440,386
Amounts owed to group undertakings
327,599
327,599
Corporation tax
167,140
85,679
Other taxation and social security
150,539
209,659
Other creditors
332,188
336,145
Accruals and deferred income
492,746
632,887
3,969,144
4,094,764
Bank loans and overdrafts are secured by a fixed and floating charge over the assets of the company.
Obligations under hire purchase and finance lease contracts of £336,797(2022 - £320,274) are secured upon the assets to which they relate.
Amounts owed to group undertakings are interest free and repayable on demand.
15
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Obligations under finance leases
17
379,314
303,553
Other creditors
250,000
250,000
629,314
553,553
Obligations under hire purchase and finance lease contracts of £379,314 (2022 - £303,553) are secured upon the assets to which they relate.
BALMERS GM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
- 20 -
16
Loans and overdrafts
2023
2022
£
£
Bank overdrafts
245,335
350,293
Other loans
418,210
391,842
663,545
742,135
Payable within one year
663,545
742,135
Other loans are secured against stock.
17
Finance lease obligations
2023
2022
Future minimum lease payments due under finance leases:
£
£
Within one year
336,797
320,274
In two to five years
379,314
303,553
716,111
623,827
Finance lease payments represent rentals payable by the company for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 5 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
18
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
453,634
477,139
Tax losses
-
(132)
453,634
477,007
BALMERS GM LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2023
18
Deferred taxation
(Continued)
- 21 -
2023
Movements in the year:
£
Liability at 1 November 2022
477,007
Credit to profit or loss
(23,373)
Liability at 31 October 2023
453,634
19
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
36,805
34,947
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.
20
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary of £1 each
1
1
1
1
21
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
98,040
56,406
Between two and five years
375,820
Property
473,860
56,406
22
Related party transactions
A Balmer, a director of the company, has provided a personal guarantee to the company's bankers limited to £400,000 (2022 - £400,000).
23
Ultimate controlling party
The parent company is Balmers Garden Machinery Holdings Limited, a company incorporated in England and Wales
The ultimate controlling party is Mrs A Balmer.
2023-10-312022-11-01falseCCH SoftwareCCH Accounts Production 2024.100D BalmerA BalmerD BarkerT BalmerM BalmerJ Balmerfalsefalse080995512022-11-012023-10-31080995512023-10-3108099551bus:Director22022-11-012023-10-3108099551bus:Director42022-11-012023-10-3108099551bus:Director52022-11-012023-10-3108099551bus:Director62022-11-012023-10-3108099551bus:Director12022-11-012023-10-3108099551bus:Director32022-11-012023-10-3108099551bus:RegisteredOffice2022-11-012023-10-31080995512021-11-012022-10-3108099551core:RetainedEarningsAccumulatedLosses2022-10-3108099551core:RetainedEarningsAccumulatedLosses2021-10-3108099551core:ShareCapital2023-10-3108099551core:ShareCapital2022-10-3108099551core:RetainedEarningsAccumulatedLosses2023-10-3108099551core:RetainedEarningsAccumulatedLosses2022-10-31080995512022-10-3108099551core:RetainedEarningsAccumulatedLosses2021-11-012022-10-3108099551core:LandBuildingscore:LeasedAssetsHeldAsLessee2023-10-3108099551core:PlantMachinery2023-10-3108099551core:FurnitureFittings2023-10-3108099551core:MotorVehicles2023-10-3108099551core:LandBuildingscore:LeasedAssetsHeldAsLessee2022-10-3108099551core:PlantMachinery2022-10-3108099551core:FurnitureFittings2022-10-3108099551core:MotorVehicles2022-10-3108099551core:CurrentFinancialInstrumentscore:WithinOneYear2023-10-3108099551core:CurrentFinancialInstrumentscore:WithinOneYear2022-10-3108099551core:Non-currentFinancialInstrumentscore:AfterOneYear2023-10-3108099551core:Non-currentFinancialInstrumentscore:AfterOneYear2022-10-3108099551core:CurrentFinancialInstruments2023-10-3108099551core:CurrentFinancialInstruments2022-10-3108099551core:Non-currentFinancialInstruments2023-10-3108099551core:Non-currentFinancialInstruments2022-10-3108099551core:Goodwill2022-11-012023-10-3108099551core:LandBuildingscore:LongLeaseholdAssets2022-11-012023-10-3108099551core:PlantMachinery2022-11-012023-10-3108099551core:FurnitureFittings2022-11-012023-10-3108099551core:MotorVehicles2022-11-012023-10-310809955112022-11-012023-10-310809955112021-11-012022-10-3108099551core:UKTax2022-11-012023-10-3108099551core:UKTax2021-11-012022-10-3108099551core:Goodwill2022-10-3108099551core:Goodwill2023-10-3108099551core:Goodwill2022-10-3108099551core:LandBuildingscore:LeasedAssetsHeldAsLessee2022-10-3108099551core:PlantMachinery2022-10-3108099551core:FurnitureFittings2022-10-3108099551core:MotorVehicles2022-10-31080995512022-10-3108099551core:LandBuildingscore:LeasedAssetsHeldAsLessee2022-11-012023-10-3108099551core:Non-currentFinancialInstruments12023-10-3108099551core:Non-currentFinancialInstruments12022-10-3108099551core:WithinOneYear2023-10-3108099551core:WithinOneYear2022-10-3108099551core:BetweenTwoFiveYears2023-10-3108099551core:BetweenTwoFiveYears2022-10-3108099551bus:PrivateLimitedCompanyLtd2022-11-012023-10-3108099551bus:FRS1022022-11-012023-10-3108099551bus:Audited2022-11-012023-10-3108099551bus:FullAccounts2022-11-012023-10-31xbrli:purexbrli:sharesiso4217:GBP