Company registration number 01518084 (England and Wales)
LOUDSPEAKER TECHNOLOGY LTD
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
LOUDSPEAKER TECHNOLOGY LTD
COMPANY INFORMATION
Directors
R Polley
William Woodman
Leanne J Woodman
(Appointed 31 July 2023)
Company number
01518084
Registered office
Gypsy Lane
Aston Down
Stroud
Glos
GL6 8HR
Auditor
Griffiths Marshall
Beaumont House
172 Southgate Street
Gloucester
Glos
GL1 2EZ
Bankers
Lloyds TSB
Villiers House
48-49 The Strand
London
WC2E 7JB
LOUDSPEAKER TECHNOLOGY LTD
CONTENTS
Page
Strategic report
1
Directors' report
2
Directors' responsibilities statement
3
Independent auditor's report
4 - 6
Statement of comprehensive income
7
Balance sheet
8
Statement of changes in equity
9
Statement of cash flows
10
Notes to the financial statements
11 - 26
LOUDSPEAKER TECHNOLOGY LTD
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2024
- 1 -
The directors present the strategic report for the year ended 31 March 2024.
Fair Review of Business
The company is a supplier of loudspeakers and operates from Aston Down, Stroud.
Principal risks and uncertainties
The process of risk acceptance and risk management is addressed through a framework of policies, procedures and controls, all of which are subject to board approval and ongoing review by management.
The principal financial risks is the company's dependence on demand for its product. This is largely affected by social factors and conditions.
Liquidity risk has been considered and is deemed to be at a low level of risk due to the strong financial position of the company.
Development and performance
The results for the company are set out pages 7 to 26. They show a profit after taxation of £897,848 (2023 - £1,628,421). The company held shareholders' funds of £8,703,487 (2023 - £7,807,639) as at 31 March 2024.
Despite a decrease in turnover and small decrease in margins, the performance of the company for the financial year was still strong, resulting in a healthy bottom line result of £908,010.
Key performance indicators
The board monitors the progress of the company by reference to the following KPI's:
2024 2023
Sales 8,246,532 11,511,605
Gross Profit 3,635,119 5,241,216
Gross Profit Margin 44.1% 45.5%
Net Profit Margin 13.5% 17.6%
The above indicators show an reduction in all metrics, which can be attributed to the settling of the market following a back log of orders that accumulated during Covid-19. The sales for 2024 show a more stable level at which sales are expected to continue moving forward.
William Woodman
Director
7 August 2024
LOUDSPEAKER TECHNOLOGY LTD
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2024
- 2 -
The directors present their annual report and financial statements for the year ended 31 March 2024.
Principal activities
The principal activity of the company is that of loudspeaker manufacturing.
Results and dividends
The results for the year are set out on page 7.
Ordinary dividends were paid amounting to £2,000. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
R Polley
M M Graham
(Resigned 31 July 2023)
William Woodman
Leanne J Woodman
(Appointed 31 July 2023)
Auditor
The auditor, Griffiths Marshall, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.
Medium-sized companies exemption
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
On behalf of the board
William Woodman
Director
7 August 2024
LOUDSPEAKER TECHNOLOGY LTD
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 MARCH 2024
- 3 -
The directors are responsible for preparing the Directors' 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;
- state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
- 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.
The directors are responsible for the maintenance and integrity of the company website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.
LOUDSPEAKER TECHNOLOGY LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF LOUDSPEAKER TECHNOLOGY LTD
- 4 -
Opinion
We have audited the financial statements of Loudspeaker Technology Ltd (the 'company') for the year ended 31 March 2024 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 31 March 2024 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.
LOUDSPEAKER TECHNOLOGY LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF LOUDSPEAKER TECHNOLOGY LTD (CONTINUED)
- 5 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the 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.
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 gained an understanding of the legal and regulatory framework applicable to Loudspeaker Technology Limited and the industry in which it operates and, considered the risk of acts by Management and directors of Loudspeaker Technology Limited which were contrary to applicable laws and regulations, including fraud. These included but were not limited to compliance with the Companies Act 2006 and Employment Law. We made enquiries of the Directors to obtain further understanding of risks of non-compliance.
We focused on laws and regulations that could give rise to a material misstatement in the financial statements. Our tests included, but were not limited to:
agreement of the financial statement disclosures to underlying supporting documentation;
enquiries of management regarding known or suspected instances of non-compliance with laws and regulations;
review of minutes of the Board meetings throughout the year; and
obtaining an understanding of the control environment in place to prevent and detect irregularities.
Our audit procedures were designed to respond to risks of material misstatement in the financial statements, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery, misrepresentations or through collusion. There are inherent limitations in the audit procedures performed and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we are to become aware of it.
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.
LOUDSPEAKER TECHNOLOGY LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF LOUDSPEAKER TECHNOLOGY LTD (CONTINUED)
- 6 -
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.
Stephen Humphries
Senior Statutory Auditor
For and on behalf of Griffiths Marshall
7 August 2024
Chartered Accountants
Statutory Auditor
Beaumont House
172 Southgate Street
Gloucester
Glos
GL1 2EZ
LOUDSPEAKER TECHNOLOGY LTD
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2024
- 7 -
2024
2023
Notes
£
£
Turnover
3
8,246,532
11,511,605
Cost of sales
(4,611,413)
(6,270,389)
Gross profit
3,635,119
5,241,216
Administrative expenses
(2,630,565)
(3,212,459)
Other operating income
3,750
Exceptional item
4
173
Operating profit
5
1,008,304
2,028,930
Interest receivable and similar income
8
114,362
8,664
Interest payable and similar expenses
9
(5,737)
(6,232)
Profit before taxation
1,116,929
2,031,362
Tax on profit
10
(208,919)
(402,941)
Profit for the financial year
908,010
1,628,421
LOUDSPEAKER TECHNOLOGY LTD
BALANCE SHEET
AS AT 31 MARCH 2024
31 March 2024
- 8 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
12
4,860,717
2,225,192
Investments
13
95
95
4,860,812
2,225,287
Current assets
Stocks
15
3,000,188
3,061,989
Debtors
16
728,843
1,083,785
Cash at bank and in hand
1,922,048
3,554,334
5,651,079
7,700,108
Creditors: amounts falling due within one year
17
(1,461,217)
(1,795,350)
Net current assets
4,189,862
5,904,758
Total assets less current liabilities
9,050,674
8,130,045
Creditors: amounts falling due after more than one year
18
(123,228)
(120,412)
Provisions for liabilities
Deferred tax liability
21
213,797
201,994
(213,797)
(201,994)
Net assets
8,713,649
7,807,639
Capital and reserves
Called up share capital
22
61,111
61,111
Share premium account
63,889
63,889
Profit and loss reserves
8,588,649
7,682,639
Total equity
8,713,649
7,807,639
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 7 August 2024 and are signed on its behalf by:
William Woodman
Director
Company registration number 01518084 (England and Wales)
LOUDSPEAKER TECHNOLOGY LTD
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2024
- 9 -
Share capital
Share premium account
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 April 2022
61,111
63,889
6,058,218
6,183,218
Year ended 31 March 2023:
Profit and total comprehensive income for the year
-
-
1,628,421
1,628,421
Dividends
11
-
-
(4,000)
(4,000)
Balance at 31 March 2023
61,111
63,889
7,682,639
7,807,639
Year ended 31 March 2024:
Profit and total comprehensive income for the year
-
-
908,010
908,010
Dividends
11
-
-
(2,000)
(2,000)
Balance at 31 March 2024
61,111
63,889
8,588,649
8,713,649
LOUDSPEAKER TECHNOLOGY LTD
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2024
- 10 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
26
1,418,035
2,137,563
Interest paid
(5,737)
(6,232)
Income taxes paid
(292,679)
(308,473)
Net cash inflow from operating activities
1,119,619
1,822,858
Investing activities
Purchase of tangible fixed assets
(2,858,363)
(462,240)
Proceeds from disposal of tangible fixed assets
58,121
1,690
Repayment of loans
(430)
Interest received
114,362
8,664
Net cash used in investing activities
(2,686,310)
(451,886)
Financing activities
Repayment of borrowings
2,816
120,412
Repayment of bank loans
(247,663)
Payment of finance leases obligations
(66,411)
(18,190)
Dividends paid
(2,000)
(4,000)
Net cash used in financing activities
(65,595)
(149,441)
Net (decrease)/increase in cash and cash equivalents
(1,632,286)
1,221,531
Cash and cash equivalents at beginning of year
3,554,334
2,332,803
Cash and cash equivalents at end of year
1,922,048
3,554,334
LOUDSPEAKER TECHNOLOGY LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
- 11 -
1
Accounting policies
Company information
Loudspeaker Technology Ltd is a private company limited by shares incorporated in England and Wales. The registered office is Gypsy Lane, Aston Down, Stroud, Glos, GL6 8HR.
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.
The company has taken advantage of the exemption under section 399 of the Companies Act 2006 not to prepare consolidated accounts, on the basis that the group of which this is the parent qualifies as a small group. The financial statements present information about the company as an individual entity and not about its group.
1.2
Business combinations
The cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill.
The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date.
Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date.
Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.
1.3
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. The coronavirus pandemic has significantly disrupted individuals’ personal lives and businesses’ economic prospects in the UK and across the globe. The UK entered lockdown in January 2021 and some restrictions and social distancing provisions remain in place. We have continued to prepare the accounts on a going concern basis and deem this appropriate. We do not consider that a material uncertainty about our going concern status currently exists. In making this assessment we have considered the likely trading conditions for a period of twelve months from the date of our approval of these accounts.
1.4
Turnover
Turnover represents amounts receivable for goods and services net of VAT and trade discounts. Turnover is generated through the companies principal activities, noted in the directors report. Revenue is recognised at the point where all significant risks and rewards of ownership of the goods are no longer considered to be held by Loudspeaker Technology Limited.
LOUDSPEAKER TECHNOLOGY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 12 -
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer, 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
Research and development expenditure
Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.
1.6
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:
Land and buildings Freehold
Nil
Land and buildings Short Leasehold
10 Year Straight Line
Plant and machinery
10 Year Straight Line
Fixtures, fittings & equipment
10 Year/4 Year Straight Line
Computer equipment
3 Year Straight Line
Motor vehicles
6 Year Straight Line
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.
1.7
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.
1.8
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.
LOUDSPEAKER TECHNOLOGY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 13 -
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.9
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell on a first in first out basis. 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 replacement cost and 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.
1.10
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.11
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
LOUDSPEAKER TECHNOLOGY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 14 -
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, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
LOUDSPEAKER TECHNOLOGY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 15 -
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.12
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.
1.13
Derivatives
Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently remeasured to fair value at each reporting end date. The resulting gain or loss is recognised in profit or loss immediately unless the derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on the nature of the hedge relationship.
A derivative with a positive fair value is recognised as a financial asset, whereas a derivative with a negative fair value is recognised as a financial liability.
1.14
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.
LOUDSPEAKER TECHNOLOGY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
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.
1.15
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.
1.16
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.17
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.
Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.
1.18
Foreign exchange
Monetary assets and liabilities denominated in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. All differences are taken to profit and loss account.
LOUDSPEAKER TECHNOLOGY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 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.
3
Turnover and other revenue
An analysis of the company's turnover is as follows:
2024
2023
£
£
Turnover analysed by class of business
Hi-Fi
3,781,255
4,282,691
Pro
4,452,156
7,168,556
Other
13,121
60,358
8,246,532
11,511,605
2024
2023
£
£
Turnover analysed by geographical market
UK
1,620,468
2,154,152
Europe
2,042,321
2,734,859
USA
2,157,940
2,505,059
Rest of the World
2,425,803
4,117,535
8,246,532
11,511,605
2024
2023
£
£
Other revenue
Interest income
114,362
8,664
4
Exceptional item
2024
2023
£
£
Expenditure
Write off of inter-company loan
-
(173)
Other operating income consists of rental income for the period of £3,750 (2023 - £nil).
LOUDSPEAKER TECHNOLOGY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 18 -
5
Operating profit
2024
2023
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange (gains)/losses
(2,238)
45,582
Research and development costs
86,453
97,737
Fees payable to the company's auditor for the audit of the company's financial statements
11,615
8,220
Depreciation of owned tangible fixed assets
157,181
179,436
Loss on disposal of tangible fixed assets
7,534
439
Operating lease charges
36,217
86,756
6
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2024
2023
Number
Number
Directors
2
2
Senior Management
3
3
Research & Development
5
5
Sales
3
3
Admin
3
5
Production
54
73
Total
70
91
Their aggregate remuneration comprised:
2024
2023
£
£
Wages and salaries
3,325,862
3,849,443
Pension costs
27,825
26,683
3,353,687
3,876,126
7
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
673,340
953,417
LOUDSPEAKER TECHNOLOGY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
7
Directors' remuneration
(Continued)
- 19 -
Remuneration disclosed above include the following amounts paid to the highest paid director:
2024
2023
£
£
Remuneration for qualifying services
355,952
392,176
8
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
114,362
8,664
2024
2023
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
114,362
8,664
9
Interest payable and similar expenses
2024
2023
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
5,737
6,232
10
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
197,116
292,679
Adjustments in respect of prior periods
222
Total current tax
197,116
292,901
Deferred tax
Origination and reversal of timing differences
11,803
110,040
Total tax charge
208,919
402,941
LOUDSPEAKER TECHNOLOGY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
10
Taxation
(Continued)
- 20 -
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:
2024
2023
£
£
Profit before taxation
1,116,929
2,031,362
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 19.00%)
279,232
385,959
Tax effect of expenses that are not deductible in determining taxable profit
(10,267)
79,902
Adjustments in respect of prior years
222
Permanent capital allowances in excess of depreciation
9,135
(49,516)
Research and development tax credit
(82,868)
(123,717)
Profit/loss on disposal of assets
1,884
83
Write off of intercompany debt
(32)
Deferred tax movement
11,803
110,040
Taxation charge for the year
208,919
402,941
From the 1 April 2023, the main rate of corporation tax in the UK increased from 19% to 25%.
11
Dividends
2024
2023
£
£
Interim paid
2,000
4,000
LOUDSPEAKER TECHNOLOGY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 21 -
12
Tangible fixed assets
Land and buildings Freehold
Land and buildings Short Leasehold
Plant and machinery
Fixtures, fittings & equipment
Computer equipment
Motor vehicles
Total
£
£
£
£
£
£
£
Cost
At 1 April 2023
1,278,615
263,409
714,918
423,010
145,063
414,800
3,239,815
Additions
2,631,439
49,723
11,716
165,484
2,858,362
Disposals
(109,953)
(109,953)
At 31 March 2024
3,910,054
263,409
764,641
423,010
156,779
470,331
5,988,224
Depreciation and impairment
At 1 April 2023
152,707
250,444
312,490
90,705
208,277
1,014,623
Depreciation charged in the year
15,227
44,845
19,881
34,489
42,739
157,181
Eliminated in respect of disposals
(44,297)
(44,297)
At 31 March 2024
167,934
295,289
332,371
125,194
206,719
1,127,507
Carrying amount
At 31 March 2024
3,910,054
95,475
469,352
90,639
31,585
263,612
4,860,717
At 31 March 2023
1,278,615
110,702
464,474
110,520
54,358
206,523
2,225,192
LOUDSPEAKER TECHNOLOGY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 22 -
13
Fixed asset investments
2024
2023
Notes
£
£
Investments in subsidiaries
14
95
95
14
Subsidiaries
Details of the company's subsidiaries at 31 March 2024 are as follows:
Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Cabtech Limited
Beaumont House, 172 Southgate Street, Gloucester, United Kingdom, GL1 2EZ
Ordinary
100.00
The aggregate capital and reserves and the result for the year of the subsidiaries noted above was as follows:
Name of undertaking
Capital and Reserves
Profit/(Loss)
£
£
Cabtech Limited
15
Stocks
2024
2023
£
£
Raw materials and consumables
2,153,893
2,662,705
Work in progress
492,969
257,943
Finished goods and goods for resale
353,326
141,341
3,000,188
3,061,989
16
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
641,209
836,068
Other debtors
34,003
212,825
Prepayments and accrued income
53,631
34,892
728,843
1,083,785
LOUDSPEAKER TECHNOLOGY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 23 -
17
Creditors: amounts falling due within one year
2024
2023
Notes
£
£
Obligations under finance leases
19
66,411
Trade creditors
319,710
465,215
Corporation tax
197,116
292,679
Other taxation and social security
104,984
186,051
Other creditors
79,746
168,271
Accruals and deferred income
759,661
616,723
1,461,217
1,795,350
18
Creditors: amounts falling due after more than one year
2024
2023
Notes
£
£
Other borrowings
20
123,228
120,412
19
Finance lease obligations
2024
2023
Future minimum lease payments due under finance leases:
£
£
Within one year
66,411
Finance lease payments represented repayments by the company for a motor vehicle with a carrying amount at 31st March 2023 of £66,291. The asset has been disposed of in the financial year to 31st March 2024.
20
Loans and overdrafts
2024
2023
£
£
Other loans
123,228
120,412
Payable after one year
123,228
120,412
LOUDSPEAKER TECHNOLOGY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 24 -
21
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2024
2023
Balances:
£
£
Accelerated capital allowances
213,797
201,994
2024
Movements in the year:
£
Liability at 1 April 2023
201,994
Charge to profit or loss
11,803
Liability at 31 March 2024
213,797
22
Share capital
2024
2023
2024
2023
Ordinary shares issued and fully paid
£
£
Ordinary Shares of £1 each
61,111
61,111
61,111
61,111
23
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2024
2023
£
£
Within one year
39,003
30,000
Between two and five years
20,705
10,000
59,708
40,000
Operating lease payments represent payments by the company for rent of a premises and vehicles. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent repayments.
LOUDSPEAKER TECHNOLOGY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 25 -
24
Related party transactions
Remuneration of key management personnel
The remuneration of key management personnel is as follows.
2024
2023
£
£
Aggregate compensation
836,777
1,014,084
Other information
During the year the company incurred rent charges of £nil (2023 - £18,583) in respect of its business premises payable to Mrs M.M.Graham. At 31 March 2024 the company owed Mrs M. M Graham £nil (2023 - £nil). All transactions have been conducted at an arms length basis.
Loudspeaker holds 100% of the share capital in Cabtech Limited, a supplier to Loudspeaker who manufacture cabinets used in their speakers. W Woodman is also a director of Cabtech Limited. Purchases made from Cabtech Limited during the year totalled £nil (2023 - £nil). Amounts owing to Cabtech at the year end was £nil (2023 - £nil).
Loudspeaker had previously loaned monies to Cabtech Limited to help finance the trade. In 2023, £173 was deemed recoverable, after the write off of £261,815 in 2022. The remaining balance owing to Loudspeaker at 31st March 2024 was £nil (2023 - £nil).
At 31 March 2024 the company accrued for director bonuses of £364,160 (2023 - £171,569). This is expected to be posted and paid post year end. The company owed £141,723 (2023 - £18,978) to the directors. Sales during the year to directors totalled £nil (2023 - £nil).
25
Analysis of changes in net funds
1 April 2023
Cash flows
31 March 2024
£
£
£
Cash at bank and in hand
3,554,334
(1,632,286)
1,922,048
Borrowings excluding overdrafts
(120,412)
(2,816)
(123,228)
Obligations under finance leases
(66,411)
66,411
-
3,367,511
(1,568,691)
1,798,820
LOUDSPEAKER TECHNOLOGY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 26 -
26
Cash generated from operations
2024
2023
£
£
Profit for the year after tax
908,010
1,628,421
Adjustments for:
Taxation charged
208,919
402,941
Finance costs
5,737
6,232
Investment income
(114,362)
(8,664)
Loss on disposal of tangible fixed assets
7,534
439
Depreciation and impairment of tangible fixed assets
157,181
179,436
Movements in working capital:
Decrease/(increase) in stocks
61,801
(360,228)
Decrease/(increase) in debtors
355,373
(12,985)
(Decrease)/increase in creditors
(172,158)
301,971
Cash generated from operations
1,418,035
2,137,563
2024-03-312023-04-01falseCCH SoftwareCCH Accounts Production 2024.100R PolleyM M GrahamWilliam WoodmanLeanne J Woodmanfalsefalse015180842023-04-012024-03-3101518084bus:Director12023-04-012024-03-3101518084bus:Director32023-04-012024-03-3101518084bus:Director42023-04-012024-03-3101518084bus:Director22023-04-012024-03-3101518084bus:RegisteredOffice2023-04-012024-03-3101518084bus:Agent12023-04-012024-03-31015180842024-03-31015180842022-04-012023-03-310151808412023-04-012024-03-310151808412022-04-012023-03-3101518084core:RetainedEarningsAccumulatedLosses2022-04-012023-03-3101518084core:RetainedEarningsAccumulatedLosses2023-04-012024-03-31015180842023-03-3101518084core:LandBuildingscore:OwnedOrFreeholdAssets2024-03-3101518084core:LandBuildingscore:LeasedAssetsHeldAsLessee2024-03-3101518084core:PlantMachinery2024-03-3101518084core:FurnitureFittings2024-03-3101518084core:ComputerEquipment2024-03-3101518084core:MotorVehicles2024-03-3101518084core:LandBuildingscore:OwnedOrFreeholdAssets2023-03-3101518084core:LandBuildingscore:LeasedAssetsHeldAsLessee2023-03-3101518084core:PlantMachinery2023-03-3101518084core:FurnitureFittings2023-03-3101518084core:ComputerEquipment2023-03-3101518084core:MotorVehicles2023-03-3101518084core:CurrentFinancialInstrumentscore:WithinOneYear2024-03-3101518084core:CurrentFinancialInstrumentscore:WithinOneYear2023-03-3101518084core:Non-currentFinancialInstrumentscore:AfterOneYear2024-03-3101518084core:Non-currentFinancialInstrumentscore:AfterOneYear2023-03-3101518084core:CurrentFinancialInstruments2024-03-3101518084core:CurrentFinancialInstruments2023-03-3101518084core:ShareCapital2024-03-3101518084core:ShareCapital2023-03-3101518084core:SharePremium2024-03-3101518084core:SharePremium2023-03-3101518084core:RetainedEarningsAccumulatedLosses2024-03-3101518084core:RetainedEarningsAccumulatedLosses2023-03-3101518084core:ShareCapital2022-03-3101518084core:SharePremium2022-03-3101518084core:RetainedEarningsAccumulatedLosses2022-03-31015180842023-03-31015180842022-03-3101518084core:LandBuildingscore:OwnedOrFreeholdAssets2023-04-012024-03-3101518084core:LandBuildingscore:LongLeaseholdAssets2023-04-012024-03-3101518084core:PlantMachinery2023-04-012024-03-3101518084core:FurnitureFittings2023-04-012024-03-3101518084core:ComputerEquipment2023-04-012024-03-3101518084core:MotorVehicles2023-04-012024-03-3101518084core:UKTax2023-04-012024-03-3101518084core:UKTax2022-04-012023-03-310151808422023-04-012024-03-310151808422022-04-012023-03-310151808432023-04-012024-03-310151808432022-04-012023-03-3101518084core:LandBuildingscore:OwnedOrFreeholdAssets2023-03-3101518084core:LandBuildingscore:LeasedAssetsHeldAsLessee2023-03-3101518084core:PlantMachinery2023-03-3101518084core:FurnitureFittings2023-03-3101518084core:ComputerEquipment2023-03-3101518084core:MotorVehicles2023-03-3101518084core:LandBuildingscore:LeasedAssetsHeldAsLessee2023-04-012024-03-3101518084core:Non-currentFinancialInstruments2024-03-3101518084core:Non-currentFinancialInstruments2023-03-310151808412023-04-012024-03-3101518084core:WithinOneYear2024-03-3101518084core:WithinOneYear2023-03-3101518084core:BetweenTwoFiveYears2024-03-3101518084core:BetweenTwoFiveYears2023-03-3101518084bus:PrivateLimitedCompanyLtd2023-04-012024-03-3101518084bus:FRS1022023-04-012024-03-3101518084bus:Audited2023-04-012024-03-3101518084bus:FullAccounts2023-04-012024-03-31xbrli:purexbrli:sharesiso4217:GBP