Company registration number 2678291 (England and Wales)
FIDDES PAYNE LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
FIDDES PAYNE LIMITED
COMPANY INFORMATION
Directors
Mr C J V White
RT Hon C H Finch-Knightley
Mrs P A White
Mr B V S White
(Appointed 20 April 2024)
Company number
2678291
Registered office
Unit 3
Network 11
Thorpe Way
Banbury
Oxon
OX16 4XS
Auditor
Ellacotts Audit Services Limited
Countrywide House
23 West Bar
Banbury
Oxfordshire
England
OX16 9SA
Bankers
HSBC Bank Plc
Thames Valley Commerical Centre
2nd Floor Midland House
Seacourt West Way
Botley
Oxfordshire
England
OX2 0PL
Solicitors
BPE Solicitors LLP
St, James' House
St. James' Square
Cheltenham
Gloucestershire
England
GL50 3PR
FIDDES PAYNE LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
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 - 22
FIDDES PAYNE LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 30 JUNE 2023
- 1 -
The directors present the strategic report for the year ended 30 June 2023.
Review of the business
The business sells to all of the major grocers and High Street Discounters in the UK and in some overseas markets and in the period the company continued to build on the strength of existing and new business and made further progress in equipping the company for long term future sustainable growth.
Sales are made in both the Home Baking and Savoury categories. The company sells its own products under the “Cake Angels” and “Full of Goodness” brands but also uses its expertise and production, sourcing and marketing expertise to sell products under third party licencing agreements for BOSH! Jamie Oliver, Disney, and the BBC as well as some retailer own label branded products.
Sales were £9.1 million for the period ended 30 June 2023 (2022: £10.2m) which is a 11.2% decrease from the previous financial year.
In the previous financial year, the company had successfully anticipated many of the consumer driven business impacts of Covid-19 and was able to take advantage of lack of preparedness of competitors.
The challenges of Covid-19 continued into this financial year and even after the cessation of all lock down measures, the return of consumers to physical shops was very slow. There was also a slower than expected return to face to face meetings with customers and that coupled with a reduction in the number of range changes in all key accounts (e.g. Jamie Oliver in J Sainsbury and non-repeat of FY22 ‘spot buys’ in Lidl & Aldi) has made new listings very challenging to realise, despite the enthusiasm shown for our innovation.
Finally, Brexit with a very late agreement and many unknowns has been an issue we and most other international businesses have had to navigate, and this has consumed a great deal of management time as well as making some existing and potential new business unviable. We have been creative in finding solutions to many of these new problems but have had to let some previously viable business go.
Despite these challenges the directors are very pleased to report an increase in operational efficiency year on year which helped mitigate the rapidly rising raw material and labour costs. In addition, the level of overheads also fell.
The company reported an operating loss of £0.6m (2022: operating loss of £0.2m) and retains a positive balance sheet with net assets of £1.0m (2022: £1.4m) and cash of £0.1m at the end of the period (2022: £0.1m).
Future developments
The performance in this financial year has placed the company in a strong position to meet budget and improve profitability in the next 12 months. However, the management team recognises that several material uncertainties exist regarding future trading and macro environments:
In response, the 12 month ‘Headroom Forecast’ has been put in place to monitor the margin of error versus the Invoice Discount Facility to ensure that there is sufficient headroom to allow the Company to operate effectively in the year ahead.
The 12 month ‘Headroom Forecast’ is updated weekly by Management and reviewed regularly by The Board, who continue to support the Company as the major shareholders.
The management team retains the confidence of the board and shareholders to deliver the strategic plan and will continue to sell Home baking and Savoury products across our owned and licensed brands, as well as selected retailer own label.
FIDDES PAYNE LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 2 -
Principal risks and uncertainties
The management of the company and the execution of the company’s strategy are subject to a number of risks. Key risks and mitigations are as follows:
Development and performance
| |
| The company has a varied customer base across both own brand and licensed products and is working to increase this diversity |
| The company tries to maintain options across each category of supply |
| The company reacts extremely quickly to any change in government guidance, in most cases being ahead of the curve to enable thorough planning ensuring no loss in production or sales |
| The company operates in both the Home Baking and Savoury sectors, and, like all companies, performance is partially linked to the wider macro-economic environment |
| Many food manufacturers face the risk of product recall and the company operates a robust production process and maintains insurance cover |
| The company purchases some ingredients and finished goods in US Dollars and Euros and is exposed to changes in exchange rates which are actively managed through forward purchasing of foreign currency |
Key performance indicators
| | |
| | |
| | |
Gross profit as % of sales | | |
| | |
Operating (loss) as % of sales | | |
| | |
Mr B V S White
Director
31 July 2024
FIDDES PAYNE LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2023
- 3 -
The directors present their annual report and financial statements for the year ended 30 June 2023.
Principal activities
The principal activity of the company continued to be that of the supply of home bake and savoury products to the grocery trade in the UK and export markets.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Mr C J V White
RT Hon C H Finch-Knightley
Mr B V White
(Resigned 17 May 2023)
Mrs P A White
Mr B V S White
(Appointed 20 April 2024)
Results and dividends
The results for the year are set out on page 8.
No ordinary dividends were paid. The directors do not recommend payment of a final dividend.
No preference dividends were paid.
Financial instruments
The company manages its liquidity risk through an invoice discounting facility with HSBC plc which ensures that it has sufficient liquid assets to meet its liabilities as they fall due. This facility is secured by a debenture over the company's trade receivables. The directors believe that the risk presented by borrowing against receivables is lower than the corresponding reduction of liquidity risk provided by the facility. The directors understand the risks associated with holding stock and have implemented processes to achieve and maintain appropriate stock levels having regard for the importance of maintaining appropriate levels of customer service.
Auditor
Ellacotts Audit Services Limited were appointed as auditor to the company and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.
FIDDES PAYNE LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 4 -
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.
On behalf of the board
Mr B V S White
Director
31 July 2024
FIDDES PAYNE LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF FIDDES PAYNE LIMITED
- 5 -
Opinion
We have audited the financial statements of Fiddes Payne Limited (the 'company') for the year ended 30 June 2023 which comprise 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:
give a true and fair view of the state of the company's affairs as at 30 June 2023 and of its loss 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.
Material uncertainty related to going concern
We draw attention to note 1.2 in the financial statements, which indicates that there are several events and conditions that may cast significant doubt on the entity's ability to continue as going concern, including loss of a major customer or contract, deterioration of gross margin, or increases to input costs. As stated in note 1.2, these events or conditions indicate that a material uncertainty exists that may cast significant doubt on the company’s ability to continue as a going concern and outline the steps that management have taken to monitor these risks. Our opinion is not modified in respect of this matter.
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.
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.
FIDDES PAYNE LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF FIDDES PAYNE 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.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
As part of an audit in accordance with ISAs (UK), we exercise professional judgement and maintain professional scepticism throughout the audit. We also perform the following procedures:
- Enquiry of management, those charged with governance around actual and potential litigation and claims.
- Enquiry of entity staff in tax and compliance functions to identify any instances of non-compliance with laws and regulations.
- Reviewing minutes of meetings of those charged with governance.
- Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations.
- Auditing the risk of management override of controls, including through testing journal entries and other adjustments for appropriateness, and evaluating the business rationale of significant transactions outside the normal course of business.
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.
FIDDES PAYNE LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF FIDDES PAYNE LIMITED
- 7 -
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.
Charlotte Toemaes BSc FCA
Senior Statutory Auditor
For and on behalf of Ellacotts Audit Services Limited
Chartered Accountants
Statutory Auditor
Countrywide House
23 West Bar
Banbury
Oxfordshire
England
OX16 9SA
1 August 2024
FIDDES PAYNE LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2023
- 8 -
2023
2022
Notes
£
£
Turnover
3
9,068,720
10,217,288
Cost of sales
(6,912,922)
(7,353,933)
Gross profit
2,155,798
2,863,355
Administrative expenses
(2,686,738)
(3,058,944)
Operating loss
4
(530,940)
(195,589)
Interest payable and similar expenses
6
(2,445)
(8,000)
Loss before taxation
(533,385)
(203,589)
Tax on loss
7
5,336
Loss for the financial year
(533,385)
(198,253)
The profit and loss account has been prepared on the basis that all operations are continuing operations.
There has been no other comprehensive income during the year.
FIDDES PAYNE LIMITED
BALANCE SHEET
AS AT 30 JUNE 2023
30 June 2023
- 9 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
8
418,782
475,942
Investments
9
2
2
418,784
475,944
Current assets
Stocks
11
1,346,173
891,630
Debtors
12
2,070,490
1,657,239
Cash at bank and in hand
103,193
86,745
3,519,856
2,635,614
Creditors: amounts falling due within one year
13
(3,029,087)
(1,668,620)
Net current assets
490,769
966,994
Net assets
909,553
1,442,938
Capital and reserves
Called up share capital
16
18,588
18,588
Share premium account
3,798,371
3,798,371
Profit and loss reserves
(2,907,406)
(2,374,021)
Total equity
909,553
1,442,938
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 31 July 2024 and are signed on its behalf by:
Mr B V S White
Director
Company registration number 2678291 (England and Wales)
FIDDES PAYNE LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2023
- 10 -
Share capital
Share premium account
Profit and loss reserves
Total
£
£
£
£
Balance at 1 July 2021
18,588
3,798,371
(2,175,768)
1,641,191
Year ended 30 June 2022:
Loss and total comprehensive income
-
-
(198,253)
(198,253)
Balance at 30 June 2022
18,588
3,798,371
(2,374,021)
1,442,938
Year ended 30 June 2023:
Loss and total comprehensive income
-
-
(533,385)
(533,385)
Balance at 30 June 2023
18,588
3,798,371
(2,907,406)
909,553
FIDDES PAYNE LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2023
- 11 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash absorbed by operations
18
(45,386)
(11,441)
Interest paid
(2,445)
(8,000)
Income taxes refunded
12,189
Net cash outflow from operating activities
(47,831)
(7,252)
Investing activities
Purchase of tangible fixed assets
(22,611)
(17,721)
Proceeds from disposal of tangible fixed assets
1,000
Net cash used in investing activities
(21,611)
(17,721)
Net decrease in cash and cash equivalents
(69,442)
(24,973)
Cash and cash equivalents at beginning of year
39,951
64,924
Cash and cash equivalents at end of year
(29,491)
39,951
Relating to:
Cash at bank and in hand
103,193
86,745
Bank overdrafts included in creditors payable within one year
(132,684)
(46,794)
FIDDES PAYNE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
- 12 -
1
Accounting policies
Company information
Fiddes Payne Limited is a private company limited by shares incorporated in England and Wales. The registered office is Unit 3, Network 11, Thorpe Way, Banbury, Oxon, OX16 4XS.
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 company has taken advantage of the exemption under section 400 of the Companies Act 2006 not to prepare consolidated accounts. The financial statements present information about the company as an individual entity and not about its group.
The principal accounting policies are set out below.
1.2
Going concern
At 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. The Company as at 30trueth June 2024 has a positive Balance Sheet with Net Assets of £0.9m and cash of £0.1m. It also has access to a £2.0m Invoice Discount Facility, with headroom of £0.7m at this date.
In consideration of the continuing adoption of going concern, the directors have reviewed the following material uncertainties:
In response, the FY25 Budget\Forecast for NSV is extremely prudent, with a very tight cost envelope, resulting in enough headroom\margin of error versus the Invoice Discount Facility to allow the Company to operate effectively in the year ahead.
The 12 month ‘Headroom Forecast’ is updated weekly by Management and reviewed regularly by The Board, who continue to support the Company as the major shareholders.
Thus, the directors continue to adopt the going concern basis in preparing the financial statements.
1.3
Reporting period
The company prepares its financial statements on an annual basis for periods which are just longer than or shorter than one year so as to include figures for complete weeks only and to correspond to the company's management accounts. The comparative amounts presented in the financial statements are therefore not necessarily entirely comparable due to the slightly (albeit materially) differing period lengths.
FIDDES PAYNE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 13 -
1.4
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.
1.5
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
Over 5-15 years straight line
Plant and machinery
15-25% reducing balance
Fixtures, fittings and equipment
15-25% reducing balance
Motor vehicles
15-15% 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
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.
1.7
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.
FIDDES PAYNE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 14 -
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.
1.8
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.
1.9
Cash at bank and in hand
Cash at bank and in hand 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.
1.10
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.
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.
FIDDES PAYNE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 15 -
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.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.11
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.
1.12
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.
FIDDES PAYNE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 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.
1.13
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.
1.14
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.15
Leases
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.
1.16
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.
FIDDES PAYNE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 17 -
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.
Critical judgements
Stock provision
Stock levels and values are constantly reviewed and should be there be an indication of impairment or obsolescence, the inventory is written down to its assessed net realisable value.
Promotional spending provision
Levels of spending on licensing are constantly reviewed compared to contractual agreements and any expected additional spending is included as a provision in the accounts.
3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
Home bake and savoury products
9,068,721
10,217,287
2023
2022
£
£
Turnover analysed by geographical market
UK
6,060,873
7,355,339
Europe
3,007,847
2,840,237
Rest of world
-
21,712
9,068,720
10,217,288
4
Operating loss
2023
2022
Operating loss for the year is stated after charging/(crediting):
£
£
Exchange losses/(gains)
21,523
(143,548)
Fees payable to the company's auditor for the audit of the company's financial statements
21,222
12,555
Depreciation of owned tangible fixed assets
78,913
100,948
Profit on disposal of tangible fixed assets
(142)
-
Operating lease charges
334,479
451,069
FIDDES PAYNE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
4
Operating loss
(Continued)
- 18 -
Exchange differences recognised in profit or loss during the year, except for those arising on financial instruments measured at fair value through profit or loss, amounted to £21,523 (2022: (143,548))
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Operational staff
19
19
Administrative staff
41
42
Total
60
61
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
2,030,994
2,356,903
Social security costs
195,661
224,641
Pension costs
135,377
143,232
2,362,032
2,724,776
The total amount of employee benefits (including employer pension contributions) received by key management personnel for their services to the company was £555,960.
6
Interest payable and similar expenses
2023
2022
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
2,445
8,000
7
Taxation
2023
2022
£
£
Current tax
Adjustments in respect of prior periods
(5,336)
FIDDES PAYNE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
7
Taxation
(Continued)
- 19 -
The actual charge/(credit) for the year can be reconciled to the expected credit for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
Loss before taxation
(533,385)
(203,589)
Expected tax credit based on the effective rate of corporation tax in the UK of 20.50% (2022: 19.00%)
(109,344)
(38,682)
Unutilised tax losses carried forward
129,115
21,333
Depreciation add back
16,742
17,422
Capital allowances
(36,513)
(5,409)
Taxation charge/(credit) for the year
-
(5,336)
8
Tangible fixed assets
Leasehold land and buildings
Plant and machinery
Fixtures, fittings and equipment
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 July 2022
162,483
1,684,025
908,458
24,865
2,779,831
Additions
20,084
2,527
22,611
Disposals
(2,200)
(2,200)
At 30 June 2023
162,483
1,701,909
910,985
24,865
2,800,242
Depreciation and impairment
At 1 July 2022
156,871
1,376,173
745,980
24,865
2,303,889
Depreciation charged in the year
2,414
50,904
25,595
78,913
Eliminated in respect of disposals
(1,342)
(1,342)
At 30 June 2023
159,285
1,425,735
771,575
24,865
2,381,460
Carrying amount
At 30 June 2023
3,198
276,174
139,410
418,782
At 30 June 2022
5,612
307,852
162,478
475,942
9
Fixed asset investments
2023
2022
Notes
£
£
Investments in subsidiaries
10
2
2
FIDDES PAYNE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 20 -
10
Subsidiaries
Details of the company's subsidiaries at 30 June 2023 are as follows:
Name of undertaking Registered Nature of business Class of % Held
Office shares held Direct Indirect
Full of Goodness Ltd England Dormant Company Ordinary 100.00
Cake Angels Ltd England Dormant Company Ordinary 100.00
11
Stocks
2023
2022
£
£
Raw materials and consumables
276,133
225,494
Work in progress
32,279
45,443
Finished goods and goods for resale
1,037,761
620,693
1,346,173
891,630
12
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
1,638,283
1,317,991
Corporation tax recoverable
5,336
5,336
Other debtors
135,581
134,467
Prepayments and accrued income
291,290
199,445
2,070,490
1,657,239
13
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Bank loans and overdrafts
14
132,684
46,794
Trade creditors
986,531
343,701
Amounts owed to group undertakings
(1)
(1)
Taxation and social security
49,004
52,450
Other creditors
1,331,115
693,237
Accruals and deferred income
529,754
532,439
3,029,087
1,668,620
FIDDES PAYNE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 21 -
14
Loans and overdrafts
2023
2022
£
£
Bank overdrafts
132,684
46,794
Payable within one year
132,684
46,794
HSBC Plc hold a debenture securing a first fixed charge and a first floating charge over all current and future assets of the Company dated 2 June 2010.
There are also fixed and floating charges covering all of the property or undertakings of the company in favour of Bibby Financial Services Ltd.
15
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
135,377
143,232
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.
16
Share capital
2023
2022
£
£
Ordinary share capital
Issued and fully paid
211,574 Ordinary shares of 5p each
10,579
10,579
47,810 A Ordinary shares of 2p each
956
956
11,535
11,535
Preference share capital
Issued and fully paid
Preference shares classified as equity
7,053
7,053
Total equity share capital
18,588
18,588
FIDDES PAYNE LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 22 -
17
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
199,834
212,293
Between two and five years
508,559
789,525
708,393
1,001,818
18
Cash absorbed by operations
2023
2022
£
£
Loss for the year after tax
(533,385)
(198,253)
Adjustments for:
Taxation charged/(credited)
(5,336)
Finance costs
2,445
8,000
Gain on disposal of tangible fixed assets
(142)
-
Depreciation and impairment of tangible fixed assets
78,913
100,948
Movements in working capital:
Increase in stocks
(454,543)
(73,508)
Increase in debtors
(413,251)
(257,570)
Increase in creditors
1,274,577
414,278
Cash absorbed by operations
(45,386)
(11,441)
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