Registered number
03271081
Farah Chemists Limited
Filleted Accounts
31 October 2023
Farah Chemists Limited
Registered number: 03271081
Balance Sheet
as at 31 October 2023
Notes 2023 2022
£ £
Fixed assets
Intangible assets 3 4,182,820 4,331,956
Tangible assets 4 817,063 610,840
Investments 5 - 200
4,999,883 4,942,996
Current assets
Stocks 689,660 444,452
Debtors 6 719,469 598,691
Cash at bank and in hand 81,893 128,927
1,491,022 1,172,070
Creditors: amounts falling due within one year 7 (621,754) (4,093,737)
Net current assets/(liabilities) 869,268 (2,921,667)
Total assets less current liabilities 5,869,151 2,021,329
Creditors: amounts falling due after more than one year 8 (3,910,279) (73,596)
Provisions for liabilities (44) (44)
Net assets 1,958,828 1,947,689
Capital and reserves
Called up share capital 2,000 2,000
Profit and loss account 1,956,828 1,945,689
Shareholders' funds 1,958,828 1,947,689
The directors are satisfied that the company is entitled to exemption from the requirement to obtain an audit under section 477 of the Companies Act 2006.
The members have not required the company to obtain an audit in accordance with section 476 of the Act.
The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of accounts.
The accounts have been prepared and delivered in accordance with the special provisions applicable to companies subject to the small companies regime. The profit and loss account has not been delivered to the Registrar of Companies.
…............................................
S Ahmed
Director
Approved by the board on 16 November 2023
Farah Chemists Limited
Notes to the Accounts
for the year ended 31 October 2023
1 Accounting policies
Basis of preparation
The accounts have been prepared under the historical cost convention and in accordance with FRS 102, The Financial Reporting Standard applicable in the UK and Republic of Ireland (as applied to small entities by section 1A of the standard) and the Companies Act 2006 as applicable to companies subject to the small companies regime. The company has taken advantage of the exemption under S399 of the Companies Act 2006 not to prepare consolidated accounts on the basis the group of which this is the parent qualifies as a small group. As a consequence the financial statements present information about the individual entity and not about its group.
Turnover
Turnover is measured at the fair value of the consideration received or receivable, net of discounts and value added taxes. Turnover includes revenue earned from the sale of goods and from the rendering of services. Turnover from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have transferred to the buyer. Turnover from the rendering of services is recognised by reference to the stage of completion of the contract. The stage of completion of a contract is measured by comparing the costs incurred for work performed to date to the total estimated contract costs.
Intangible fixed assets
Goodwill represents the excess of the cost of acquisition of unincorporated businesses over the fair value of net assets aquired. 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 20 years.
Tangible fixed assets
Tangible fixed assets are measured at cost less accumulative depreciation and any accumulative impairment losses. Depreciation is provided on all tangible fixed assets, other than freehold land, at rates calculated to write off the cost, less estimated residual value, of each asset evenly over its expected useful life, as follows:
Freehold buildings Straight line over 50 years
Leasehold land and buildings Straight line over 100 year lease
Fixtures, fittings, tools and equipment 15% reducing balance
Investments
Investments in subsidiaries, associates and joint ventures are measured at cost less any accumulated impairment losses. Listed investments are measured at fair value. Unlisted investments are measured at fair value unless the value cannot be measured reliably, in which case they are measured at cost less any accumulated impairment losses. Changes in fair value are included in the profit and loss account.
Stocks
Stocks are measured at the lower of cost and estimated selling price less costs to complete and sell. Cost is determined using the first in first out method. The carrying amount of stock sold is recognised as an expense in the period in which the related revenue is recognised.
Cash and cash equivalents
Cash and cash equivalents are basic financial instruments and include cash in hand and deposits held at call with banks.
Financial instruments
The company has elected to apply the provisions of Section 11 'Basic Financial Instruments' and Section 12 'Other Financial Instrument Issues' of FRS 102 to all its financial instruments. Financial instruments are recognised 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.
Debtors
Short term debtors are measured at transaction price (which is usually the invoice price), less any impairment losses for bad and doubtful debts. Loans and other financial assets are initially recognised at transaction price including any transaction costs and subsequently measured at amortised cost determined using the effective interest method, less any impairment losses for bad and doubtful debts.
Creditors
Short term creditors are measured at transaction price (which is usually the invoice price). Loans and other financial liabilities are initially recognised at transaction price net of any transaction costs and subsequently measured at amortised cost determined using the effective interest method.
Equity instruments
Equity instruments issued by the company are recorded at the fair value of 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.
Taxation
A current tax liability is recognised for the tax payable on the taxable profit of the current and past periods. A current tax asset is recognised in respect of a tax loss that can be carried back to recover tax paid in a previous period. Deferred tax is recognised in respect of all timing differences between the recognition of income and expenses in the financial statements and their inclusion in tax assessments. Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing difference, except for revalued land and investment property where the tax rate that applies to the sale of the asset is used. Current and deferred tax assets and liabilities are not discounted.
Provisions
Provisions (ie liabilities of uncertain timing or amount) are recognised when there is an obligation at the reporting date as a result of a past event, it is probable that economic benefit will be transferred to settle the obligation and the amount of the obligation can be estimated reliably.
Foreign currency translation
Transactions in foreign currencies are initially recognised at the rate of exchange ruling at the date of the transaction. At the end of each reporting period foreign currency monetary items are translated at the closing rate of exchange. Non-monetary items that are measured at historical cost are translated at the rate ruling at the date of the transaction. All differences are charged to profit or loss.
Leased assets
A lease is classified as a finance lease if it transfers substantially all the risks and rewards incidental to ownership. All other leases are classified as operating leases. The rights of use and obligations under finance leases are initially recognised as assets and liabilities at amounts equal to the fair value of the leased assets or, if lower, the present value of the minimum lease payments. Minimum lease payments are apportioned between the finance charge and the reduction in the outstanding liability using the effective interest rate method. The finance charge is allocated to each period during the lease so as to produce a constant periodic rate of interest on the remaining balance of the liability. Leased assets are depreciated in accordance with the company's policy for tangible fixed assets. If there is no reasonable certainty that ownership will be obtained at the end of the lease term, the asset is depreciated over the lower of the lease term and its useful life. Operating lease payments are recognised as an expense on a straight line basis over the lease term.
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense.
Pensions
Contributions to defined contribution plans are expensed in the period to which they relate. Differences between contributions payable in the year and contributions actually paid are shown as either accruals or prepayments.
2 Employees 2023 2022
Number Number
Average number of persons employed by the company 35 38
3 Intangible fixed assets £
Goodwill:
Cost
At 1 November 2022 6,747,917
At 31 October 2023 6,747,917
Amortisation
At 1 November 2022 2,415,961
Provided during the year 149,136
At 31 October 2023 2,565,097
Net book value
At 31 October 2023 4,182,820
At 31 October 2022 4,331,956
4 Tangible fixed assets
Land and buildings (inc Leasehold) Plant and machinery etc Motor vehicles Total
£ £ £ £
Cost
At 1 November 2022 482,448 497,316 56,653 1,036,417
Additions - 145,639 147,809 293,448
At 31 October 2023 482,448 642,955 204,462 1,329,865
Depreciation
At 1 November 2022 83,611 340,786 1,180 425,577
Charge for the year 8,867 46,014 32,344 87,225
At 31 October 2023 92,478 386,800 33,524 512,802
Net book value
At 31 October 2023 389,970 256,155 170,938 817,063
At 31 October 2022 398,837 156,530 55,473 610,840
5 Fixed asset investments
Other
investments
£
Cost
At 1 November 2022 200
Disposals (200)
At 31 October 2023 -
The fixed asset investment which was shares in Clyde Chemist Limited and Tyne Care Holdings Limited has been written off as both entities are no longer in existence.
6 Debtors 2023 2022
£ £
Trade debtors 439,475 427,355
ISAA global holdings 187,067 101,557
Other debtors 92,927 69,779
719,469 598,691
7 Creditors: amounts falling due within one year 2023 2022
£ £
Bank loans and overdrafts 64,527 3,491,039
Obligations under finance lease and hire purchase contracts 39,375 12,303
Trade creditors 245,850 424,131
Taxation and social security costs 119,093 140,805
Other creditors 152,909 25,459
621,754 4,093,737
The bank overdraft and loans are secured by way of an unlimited debenture from Farah Chemists Limited. An omnibus guarantee and set off agreement among the Bank, Farah Chemists Limited and ISAA Holdings Limited together with such other security as the Bank may from time to time hold in respect of the debts and liabilities of any guarantor to the Bank. An all moneys joint and several guarantee from Mr Shakeel Ahmed & Mr Mohammed Ahmed for a principal amount of £744,000 plus interest and other costs as detailed in the guarantee together with such other security as the Bank may from time to time hold in respect of the debts and liabilities of the guarantors to the Bank. A first legal charge from Farah Chemists Limited over the leasehold land and buildings at Burnopfield Pharmacy, Cedar Crescent, Burnopfield, Newcastle upon Tyne, NE16 6HU
8 Creditors: amounts falling due after one year 2023 2022
£ £
Bank loans 3,778,892 37,500
Obligations under finance lease and hire purchase contracts 131,387 36,096
3,910,279 73,596
The bank overdraft and loans are secured by way of an unlimited debenture from Farah Chemists Limited. An omnibus guarantee and set off agreement among the Bank, Farah Chemists Limited and ISAA Holdings Limited together with such other security as the Bank may from time to time hold in respect of the debts and liabilities of any guarantor to the Bank. An all moneys joint and several guarantee from Mr Shakeel Ahmed & Mr Mohammed Ahmed for a principal amount of £744,000 plus interest and other costs as detailed in the guarantee together with such other security as the Bank may from time to time hold in respect of the debts and liabilities of the guarantors to the Bank. A first legal charge from Farah Chemists Limited over the leasehold land and buildings at Burnopfield Pharmacy, Cedar Crescent, Burnopfield, Newcastle upon Tyne, NE16 6HU
9 Related party transactions 2023 2022
£ £
The following amounts were outstanding at the reporting end date:
Amounts due to related parties
Directors 117,966 2,636
The following amounts were outstanding at the reporting end date:
Amounts due from related parties
Related entity 187,067 101,557
10 Parent company
The ultimate controlling party is ISAA Holdings Limited, registered office 136 Armstrong Road, Newcastle upon Tyne NE4 8PR, due to it's ownership of the entire issued share capital.
11 Other information
Farah Chemists Limited is a private company limited by shares and incorporated in England. Its registered office is:
136 Armstrong Road
Newcastle upon Tyne
Tyne & Wear
NE$ 8PR
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