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THE DOUBLE A TRADING COMPANY LIMITED
DIRECTORS' REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

 
THE DOUBLE A TRADING COMPANY LIMITED
 

COMPANY INFORMATION


Directors
Mr A Armit 
Mrs A Armit 
Mr R Kelly (appointed 1 June 2023)




Company secretary
Mrs A Armit



Registered number
SC205889



Registered office
14 City Quay

Dundee

DD1 3JA




Trading Address
Eden Valley Business Park
East Road

Cupar

Fife

KY15 4RB






Independent auditors
Sumer Auditco Limited
Chartered Accountants & Statutory Auditors

14 City Quay

Dundee

DD1 3JA





 
THE DOUBLE A TRADING COMPANY LIMITED
 

CONTENTS



Page
Strategic Report
1 - 2
Directors' Report
3 - 4
Independent Auditors' Report
5 - 8
Statement of Comprehensive Income
9
Statement of Financial Position
10
Statement of Changes in Equity
11
Statement of Cash Flows
12
Analysis of Net Debt
13
Notes to the Financial Statements
14 - 28


 
THE DOUBLE A TRADING COMPANY LIMITED
 

STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

Introduction
 
The Company's principal activity continues to be the sale of ground care equipment, together with related parts and servicing. There have been no significant changes in the Company's principal activities in the year under review. 

Business review
 
We are pleased to report another strong year of results. Turnover has increased by £2,941,175 to £15,510,077 (2022: £12,568,902) and the net profit before tax has increased by £544,996 to £967,714 (2022: £422,718). The business continues to supply our customers with a premium product supported by our highly skilled team, allowing us to retain, and attract new customers. Overall, the Directors were pleased with the overall performance. 

Principal risks and uncertainties
 
Commercial risks
Competitive pressures in the local area is a continuing risk for the Company, which could result in it losing sales to competitors.  The Company manages this risk by providing added value services to its customers, having fast response times not only in supplying products but in handling all customer queries and by maintaining strong relationships with its customers. The Company has franchise agreements with good quality suppliers and these agreements ensure that the company has exclusivity of supply of strong brand named goods in the local area.
Environmental risks
The Company recognises the importance of its environmental responsibilities and monitors its impact on the environment by implementing any policies necessary to reduce any damage that might be caused by the Company's activities.
Health and safety legislation
The Company recognises the importance and implications of the Health & Safety at Work Act 1974, the Environmental Protection Legislation and all new Health and Safety legislation, including those being introduced through EU derivatives.  The Company holds regular meetings in which health and safety matters are discussed and any relevant information is filtered down to staff.
Liquidity and cash flow risks 
Management accounts are prepared and reviewed on a monthly basis, whilst cash flow is monitored on a weekly basis to ensure the business has adequate liquid resources to meet the ongoing operating needs of the business. 
The business has an overdraft facility for day-to-day trading and uses HP and long-term loans to finance capital expenditure. 

Page 1

 
THE DOUBLE A TRADING COMPANY LIMITED
 

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Financial key performance indicators
 
The business uses KPI’s to measure monthly and cumulative performance against budget and previous periods. Management will review performance by 3 key divisions of sales (wholegoods), parts and service. These are then split by individual depot with comparisons across all geography. These KPI’s include turnover, gross margin, operating profit and absorption. 
Overall, turnover has increased in the year. This is primarily from the inclusion of a newly acquired depot. For existing depots, there has still been growth, reflecting the increase in demand for high quality wholegoods and the ongoing maintenance of existing machinery within our geography. Margins overall have been maintained, which is reflective of continued cost control. 


This report was approved by the board on 21 August 2024 and signed on its behalf.



Mr A Armit
Director

Page 2

 
THE DOUBLE A TRADING COMPANY LIMITED
 

 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

The directors present their report and the financial statements for the year ended 31 December 2023.

Directors' responsibilities statement

The directors are responsible for preparing the Strategic Report, 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 for the Company's financial statements and then apply them consistently;

make judgments 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 to enable them to ensure that the financial statements comply with the Companies Act 2006They 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.

Results and dividends

The profit for the year, after taxation, amounted to £735,190 (2022 - £310,464).

No dividends are recommended to be paid.  Dividends of £115,387 (2022 - £72,400) were paid in the year.

Directors

The directors who served during the year were:

Mr A Armit 
Mrs A Armit 
Mr R Kelly (appointed 1 June 2023)

Future developments

As part of the continued vision for growth in the West of Scotland the business purchased land in East Kilbride in May 2023 and plans to build a new depot on this land to replace the rented premises currently being used. Whilst growth is planned in the West of Scotland, the business will also continue to maintain the prominent position held in Fife and Aberdeenshire.

Page 3

 
THE DOUBLE A TRADING COMPANY LIMITED
 

 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Disclosure of information to auditors

Each of the persons who are directors at the time when this Directors' Report is approved has confirmed that:
 
so far as the director is aware, there is no relevant audit information of which the Company's auditors are unaware, and

the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditors are aware of that information.

Post balance sheet events

The business started construction of their new depot in the West of Scotland during May 2024 with plans to complete the project during 2025. The construction of the new depot will be financed with bank loans secured against other business properties. 

Auditors

The auditorsSumer Auditco Limitedwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board on 21 August 2024 and signed on its behalf.
 





Mr A Armit
Director

Page 4

 
THE DOUBLE A TRADING COMPANY LIMITED
 

 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THE DOUBLE A TRADING COMPANY LIMITED
 

Opinion


We have audited the financial statements of The Double A Trading Company Limited (the 'Company') for the year ended 31 December 2023, which comprise the Statement of Comprehensive Income, the Statement of Financial Position, the Statement of Cash Flows, the Statement of Changes in Equity and the related notes, including a summary of significant accounting policiesThe 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 December 2023 and of its profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


Basis for opinion


We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' 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 United Kingdom, including the Financial Reporting Council'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.


Page 5

 
THE DOUBLE A TRADING COMPANY LIMITED
 

 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THE DOUBLE A TRADING COMPANY LIMITED (CONTINUED)


Other information


The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' Report thereon. The directors are responsible for the other information contained within the Annual ReportOur 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.


Opinion on other matters prescribed by the Companies Act 2006
 

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


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 directors' 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 set out on page 3, 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.


Page 6

 
THE DOUBLE A TRADING COMPANY LIMITED
 

 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THE DOUBLE A TRADING COMPANY LIMITED (CONTINUED)


Auditors' 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 Auditors' 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 the company and the industry in
which it operates, and considered the risk of acts by the company that were contrary to applicable laws and
regulations, including fraud. We designed audit procedures to respond to the risk, 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 or intentional misrepresentations, or through
collusion.
We focussed on laws and regulations which could give rise to a material misstatement in the financial
statements, including, but not limited to, the Companies Act 2006 and UK tax legislation. Our tests included
agreeing the financial statement disclosures to underlying supporting documentation, enquiries with
management and enquiries of legal counsel. There are inherent limitations in the audit procedures described
above 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 would become aware of it.  As in all our audits, we also addressed the risk of management override of internal controls, including testing journals and evaluating whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud.


A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' Report.


Page 7

 
THE DOUBLE A TRADING COMPANY LIMITED
 

 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THE DOUBLE A TRADING COMPANY LIMITED (CONTINUED)


Use of our report
 

This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006Our 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 Auditors' 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.





Douglas Rae (Senior Statutory Auditor)
  
for and on behalf of
Sumer Auditco Limited
 
Chartered Accountants & Statutory Auditors
  
14 City Quay
Dundee
DD1 3JA

22 August 2024
Page 8

 
THE DOUBLE A TRADING COMPANY LIMITED
 

STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
£
£

  

Turnover
 4 
15,510,077
12,568,902

Cost of sales
  
(13,264,755)
(11,012,901)

Gross profit
  
2,245,322
1,556,001

Administrative expenses
  
(1,512,090)
(1,186,571)

Other operating income
 5 
318,927
105,101

Operating profit
 6 
1,052,159
474,531

Interest payable and similar expenses
 10 
(84,445)
(51,813)

Profit before taxation
  
967,714
422,718

Tax on profit
 11 
(232,524)
(112,254)

Profit for the financial year
  
735,190
310,464

  

Total comprehensive income for the year
  
735,190
310,464

The notes on pages 14 to 28 form part of these financial statements.

Page 9

 
THE DOUBLE A TRADING COMPANY LIMITED
REGISTERED NUMBER: SC205889

STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2023

2023
2022
£
£

Fixed assets
  

Tangible assets
 13 
2,244,065
1,866,659

  
2,244,065
1,866,659

Current assets
  

Stocks
 15 
5,581,777
3,904,129

Debtors: amounts falling due within one year
 16 
1,151,487
1,288,881

Cash at bank and in hand
  
330,825
1,070

  
7,064,089
5,194,080

Creditors: amounts falling due within one year
 17 
(4,238,992)
(3,001,579)

Net current assets
  
 
 
2,825,097
 
 
2,192,501

Total assets less current liabilities
  
5,069,162
4,059,160

Creditors: amounts falling due after more than one year
 18 
(1,394,621)
(1,015,041)

Provisions for liabilities
  

Deferred tax
 22 
(159,193)
(148,574)

  
 
 
(159,193)
 
 
(148,574)

Net assets
  
3,515,348
2,895,545


Capital and reserves
  

Called up share capital 
 23 
100
100

Profit and loss account
 24 
3,515,248
2,895,445

  
3,515,348
2,895,545


The financial statements were approved and authorised for issue by the board and were signed on its behalf on 21 August 2024.




Mr A Armit
Director

The notes on pages 14 to 28 form part of these financial statements.

Page 10

 
THE DOUBLE A TRADING COMPANY LIMITED
 

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023


Called up share capital
Profit and loss account
Total equity

£
£
£


At 1 January 2022
100
2,657,381
2,657,481


Comprehensive income for the year

Profit for the year
-
310,464
310,464


Contributions by and distributions to owners

Dividends: Equity capital
-
(72,400)
(72,400)



At 1 January 2023
100
2,895,445
2,895,545


Comprehensive income for the year

Profit for the year
-
735,190
735,190


Contributions by and distributions to owners

Dividends: Equity capital
-
(115,387)
(115,387)


At 31 December 2023
100
3,515,248
3,515,348


The notes on pages 14 to 28 form part of these financial statements.

Page 11

 
THE DOUBLE A TRADING COMPANY LIMITED
 

STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
£
£

Cash flows from operating activities

Profit for the financial year
735,190
310,464

Adjustments for:

Depreciation of tangible assets
167,745
161,304

Loss on disposal of tangible assets
(26,196)
(16,294)

Interest paid
90,123
51,813

Taxation charge
232,524
112,254

(Increase) in stocks
(1,677,648)
(1,561,759)

Decrease/(increase) in debtors
137,394
(90,349)

Increase/(decrease) in creditors
402,990
(53,921)

Corporation tax (paid)
(82,233)
(53,920)

Net cash generated from operating activities

(20,111)
(1,140,408)


Cash flows from investing activities

Purchase of tangible fixed assets
(596,901)
(203,495)

Sale of tangible fixed assets
77,946
34,888

Net cash from investing activities

(518,955)
(168,607)

Cash flows from financing activities

Repayment of loans
(75,201)
(74,740)

Other new loans
791,703
440,846

Repayment of/new hire purchases and finance leases
463,742
53,629

Dividends paid
(115,387)
(72,400)

Interest paid
(90,123)
(51,813)

Net cash used in financing activities
974,734
295,522

Net increase/(decrease) in cash and cash equivalents
435,668
(1,013,493)

Cash and cash equivalents at beginning of year
(104,843)
908,650

Cash and cash equivalents at the end of year
330,825
(104,843)


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
330,825
1,070

Bank overdrafts
-
(105,913)

330,825
(104,843)


The notes on pages 14 to 28 form part of these financial statements.

Page 12

 
THE DOUBLE A TRADING COMPANY LIMITED
 

ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 DECEMBER 2023





At 1 January 2023
Cash flows
New finance leases
At 31 December 2023
£

£

£

£

Cash at bank and in hand

1,070

329,755

-

330,825

Bank overdrafts

(105,913)

105,913

-

-

Debt due after 1 year

(938,647)

72,450

-

(866,197)

Debt due within 1 year

(520,056)

(789,536)

-

(1,309,592)

Finance leases & hire purchase

(250,054)

263,432

(727,174)

(713,796)


(1,813,600)
(17,986)
(727,174)
(2,558,760)

The notes on pages 14 to 28 form part of these financial statements.

Page 13

 
THE DOUBLE A TRADING COMPANY LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

1.


General information

The entity is a private company limited by shares, registered in Scotland.  The registered office is 14 City Quay, Dundee, DD1 3JA and the primary trading address is Eden Valley Business Park, East Road, Cupar, KY15 4RB.
The principal activity of the company is the sale of groundcare machinery, equipment and supplies.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies (see note 3).

No consolidated accounts are prepared for the group headed by The Double A Trading Company Limited in accordance with s402 of Companies Act 2006 since all subsidiary undertakings are eligible for exclusion from consolidation.

The following principal accounting policies have been applied:

 
2.2

Foreign currency translation

Functional and presentation currency

The Company's functional and presentational currency is GBP.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.

At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.

Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.

Page 14

 
THE DOUBLE A TRADING COMPANY LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.3

Turnover

Turnover is recognised to the extent that it is probable that the economic benefits will flow to the Company and the turnover can be reliably measured. Turnover is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before turnover is recognised:

Sale of goods

Turnover from the sale of goods is recognised when all of the following conditions are satisfied:
the Company has transferred the significant risks and rewards of ownership to the buyer;
the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
the amount of turnover can be measured reliably;
it is probable that the Company will receive the consideration due under the transaction; and
the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Rendering of services

Turnover from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
the amount of turnover can be measured reliably;
it is probable that the Company will receive the consideration due under the contract;
the stage of completion of the contract at the end of the reporting period can be measured reliably; and
the costs incurred and the costs to complete the contract can be measured reliably.

 
2.4

Operating leases: the Company as lessor

Rental income from operating leases is credited to profit or loss on a straight-line basis over the lease term.

 
2.5

Operating leases: the Company as lessee

Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.

 
2.6

Pensions

Defined contribution pension plan

The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.

The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of Financial Position. The assets of the plan are held separately from the Company in independently administered funds.

Page 15

 
THE DOUBLE A TRADING COMPANY LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.7

Current and deferred taxation

The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company operates and generates income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the reporting date, except that:
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.

 
2.8

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

Land is not depreciated. Depreciation on other assets is charged so as to allocate the cost of assets less their residual value over their estimated useful lives.

Depreciation is provided on the following basis:

Land & buildings
-
2% straight line
Plant and machinery & office equipment
-
20 - 25% reducing balance
Motor vehicles
-
25% reducing balance
Tenant's improvements
-
20% straight line

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

Page 16

 
THE DOUBLE A TRADING COMPANY LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.9

Impairment of fixed assets and goodwill

Assets that are subject to depreciation or amortisation are assessed at each reporting date to determine whether there is any indication that the assets are impaired. Where there is any indication that an asset may be impaired, the carrying value of the asset (or cash-generating unit to which the asset has been allocated) is tested for impairment. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's (or CGU's) fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (CGUs). Non-financial assets that have been previously impaired are reviewed at each reporting date to assess whether there is any indication that the impairment losses recognised in prior periods may no longer exist or may have decreased.

 
2.10

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

 
2.11

Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a weighted average basis. Work in progress and finished goods include labour and attributable overheads.

At each reporting date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.

 
2.12

Provisions for liabilities

Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
 
Increases in provisions are generally charged as an expense to profit or loss.

Page 17

 
THE DOUBLE A TRADING COMPANY LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.13

Financial instruments

The Company has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the Company's Statement of Financial Position 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 trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.

Discounting is omitted where the effect of discounting is immaterial. The Company's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.

 
2.14

Dividends

Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting.


3.


Judgements in applying accounting policies and key sources of estimation uncertainty

Tangible Fixed Assets 
Tangible fixed assets are depreciated over their useful lives, taking into account residual values where appropriate.  The actual lives of the assets are assessed annually and may vary depending on a number of factors.  In re-assessing asset lives, factors including technological innovation, asset life cycles and maintenance programmes are taken into account.  Residual value assessmnets consider issues such as future market conditions, the remaining life of the asset and projected disposal values.

Assets are considered for indications of impairment.  If required, an impairment review will be carried out and a decision made on possible impairment.  Factors taken into consideration in reaching such a decision include the economic viability and expected future performance of the asset.

Net Realisable Value of Stock
Stock is held at the lower of cost or net realisable value.  The relevant manager reviews all stock items on an ongoing basis and, where there is evidence of a reduction in net realisable value below cost, the relevant provision is made. 

Page 18

 
THE DOUBLE A TRADING COMPANY LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

4.


Turnover

An analysis of turnover by class of business is as follows:


2023
2022
£
£

Wholegood sales
12,212,311
9,632,920

Parts sales
1,794,797
1,691,252

Servicing
1,269,089
1,078,902

Equipment hire
233,880
165,828

15,510,077
12,568,902


Analysis of turnover by country of destination:

2023
2022
£
£

United Kingdom
15,293,531
12,430,632

Rest of Europe
216,546
138,270

15,510,077
12,568,902



5.


Other operating income

2023
2022
£
£

Manufacturer incentives received
317,717
105,101

Other operating income
1,210
-

318,927
105,101



6.


Operating profit

The operating profit is stated after charging:

2023
2022
£
£

Depreciation of tangible fixed assets
167,745
162,009

Exchange differences
(529)
13,601

Other operating lease rentals
65,053
50,093

Page 19

 
THE DOUBLE A TRADING COMPANY LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

7.


Auditors' remuneration

During the year, the Company obtained the following services from the Company's auditors:


2023
2022
£
£

Fees payable to the Company's auditors for the audit of the Company's financial statements
13,500
12,000

8.


Employees

Staff costs, including directors' remuneration, were as follows:


2023
2022
£
£

Wages and salaries
1,853,479
1,611,645

Social security costs
168,215
167,265

Cost of defined contribution scheme
108,963
43,800

2,130,657
1,822,710


The average monthly number of employees, including the directors, during the year was as follows:


        2023
        2022
            No.
            No.







Employees
48
46


9.


Directors' remuneration

2023
2022
£
£

Directors' emoluments
149,411
110,000

Company contributions to defined contribution pension schemes
61,902
3,300

211,313
113,300


During the year retirement benefits were accruing to 3 directors (2022 - 2) in respect of defined contribution pension schemes.

The highest paid director received remuneration of £58,208 (2022 - £68,435).

The value of the Company's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to £59,152 (2022 - £1,950).

Page 20

 
THE DOUBLE A TRADING COMPANY LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

10.


Interest payable and similar expenses

2023
2022
£
£


Bank interest payable
74,107
40,994

Finance leases and hire purchase contracts
10,338
10,819

84,445
51,813


11.


Taxation


2023
2022
£
£

Corporation tax


Current tax on profits for the year
221,905
71,269


Total current tax
221,905
71,269

Deferred tax


Origination and reversal of timing differences
10,619
7,010

Changes to tax rates
-
33,975

Total deferred tax
10,619
40,985


Tax on profit
232,524
112,254
Page 21

 
THE DOUBLE A TRADING COMPANY LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
 
11.Taxation (continued)


Factors affecting tax charge for the year

The tax assessed for the year is higher than (2022 - higher than) the standard rate of corporation tax in the UK of 23.52% (2022 - 19%). The differences are explained below:

2023
2022
£
£


Profit on ordinary activities before tax
967,714
422,616


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 23.52% (2022 - 19%)
227,606
80,297

Effects of:


Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
1,802
2,482

Capital allowances for year in excess of depreciation
(1,534)
(6,234)

Short-term timing difference leading to an increase (decrease) in taxation
192
(489)

Other timing differences leading to an increase (decrease) in taxation
10,619
40,985

Book profit on chargeable assets
(6,161)
(3,096)

Changes in provisions leading to an increase (decrease) in the tax charge
-
(1,691)

Total tax charge for the year
232,524
112,254


Factors that may affect future tax charges

There were no factors that may affect future tax charges.




12.


Dividends

2023
2022
£
£


Ordinary shares
115,387
72,400

115,387
72,400

Page 22

 
THE DOUBLE A TRADING COMPANY LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

13.


Tangible fixed assets





Land & buildings
Plant and machinery & office equipment
Motor vehicles
Tenant's improvements
Total

£
£
£
£
£



Cost or valuation


At 1 January 2023
1,614,480
633,292
618,535
7,183
2,873,490


Additions
392,390
28,345
176,166
-
596,901


Disposals
(3,052)
(942)
(160,353)
-
(164,347)



At 31 December 2023

2,003,818
660,695
634,348
7,183
3,306,044



Depreciation


At 1 January 2023
240,594
422,975
342,449
813
1,006,831


Charge for the year on owned assets
25,859
56,376
21,548
719
104,502


Charge for the year on financed assets
-
-
63,243
-
63,243


Disposals
-
(133)
(112,464)
-
(112,597)



At 31 December 2023

266,453
479,218
314,776
1,532
1,061,979



Net book value



At 31 December 2023
1,737,365
181,477
319,572
5,651
2,244,065



At 31 December 2022
1,373,886
210,317
276,086
6,370
1,866,659

Included within land and buildings is £294,145 (2021 - £291,718) of land which is not depreciated.  All land and buildings are freehold.

The net book value of assets held under finance leases or hire purchase contracts, included above, are as follows:


2023
2022
£
£



Motor vehicles
253,607
195,007

253,607
195,007

Page 23

 
THE DOUBLE A TRADING COMPANY LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

14.


Fixed asset investments





Investments in subsidiary companies

£





At 1 January 2023
100


Disposals
(100)



At 31 December 2023

-





At 1 January 2023
100


Reversal of impairment losses
(100)



At 31 December 2023

-


15.


Stocks

2023
2022
£
£

Parts
611,306
605,013

Rental fleet
607,292
-

Wholegoods
4,363,179
3,299,116

5,581,777
3,904,129



16.


Debtors

2023
2022
£
£


Trade debtors
735,229
895,411

Other debtors
264,587
278,687

Prepayments and accrued income
151,671
114,783

1,151,487
1,288,881


Page 24

 
THE DOUBLE A TRADING COMPANY LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

17.


Creditors: Amounts falling due within one year

2023
2022
£
£

Bank overdrafts
-
105,913

Bank loans
64,592
67,343

Other loans
1,232,549
440,846

Trade creditors
1,362,117
1,401,677

Taxation and social security
755,325
333,791

Obligations under finance lease and hire purchase contracts
185,372
173,660

Other creditors
12,451
11,867

Accruals and deferred income
626,586
466,482

4,238,992
3,001,579



18.


Creditors: Amounts falling due after more than one year

2023
2022
£
£

Bank loans
866,197
938,647

Net obligations under finance leases and hire purchase contracts
528,424
76,394

1,394,621
1,015,041



19.


Creditors: Security

Hire purchase contracts are secured against the assets to which they relate.
Included in other loans is an amount of £1,232,549 (2022 - £440,846)  which is secured against specific stock items.
In addition, standard securities have been granted to The Royal Bank of Scotland plc over the sites at Eden Valley Business Park and Kintore Business Park, along with a bond and floating charge over all assets of the company.  These securities cover the entirety of the bank loans and the bank overdraft.

Page 25

 
THE DOUBLE A TRADING COMPANY LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

20.


Loans


Analysis of the maturity of loans is given below:


2023
2022
£
£

Amounts falling due within one year

Bank loans
64,592
67,343

Other loans
1,232,549
440,846


1,297,141
508,189

Amounts falling due 1-2 years

Bank loans
837,030
68,450


837,030
68,450

Amounts falling due 2-5 years

Bank loans
29,167
870,197


29,167
870,197


2,163,338
1,446,836



21.


Hire purchase and finance leases


Minimum lease payments under hire purchase fall due as follows:

2023
2022
£
£


Within one year
178,652
173,660

Between 1-5 years
509,382
76,394

688,034
250,054


22.


Deferred taxation




2023
2022


£

£






At beginning of year
(148,574)
(107,589)


Charged to profit or loss
(10,619)
(40,985)



At end of year
(159,193)
(148,574)

Page 26

 
THE DOUBLE A TRADING COMPANY LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
 
22.Deferred taxation (continued)

The provision for deferred taxation is made up as follows:

2023
2022
£
£


Accelerated capital allowances
(159,193)
(148,574)

(159,193)
(148,574)


23.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



100 (2022 - 100) Ordinary shares of £1.00 each
100
100



24.


Reserves

Profit and loss account

The profit and loss account is a distributable reserve which includes all current and prior year retained profits and losses.


25.


Pension commitments

The Company operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Company  in an independently administered fund. The pension cost charge represents contributions payable by the Company to the fund and amounted to £108,963 (2022 - £43,800). Contributions totalling £12,451 (2022 - £11,867) were payable to the fund at the balance sheet date and are included in creditors.


26.


Commitments under operating leases

At 31 December 2023 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:

2023
2022
£
£


Not later than 1 year
65,086
62,186

Later than 1 year and not later than 5 years
42,609
104,795

107,695
166,981

Page 27

 
THE DOUBLE A TRADING COMPANY LIMITED
 

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

27.


Transactions with directors

The following loans are repayable on demand.  No interest is charged on the loans and no provision has been made against the outstanding balances.



Opening balance
Amounts advanced
Amounts repaid
Closing balance

Director 1
77,492
17,287
(6,193)
88,586

Director 2
74,225
23,837
(6,193)
91,869

151,717
41,124
(12,386)
180,455


28.


Related party transactions

The directors consider themselves to be the only key management personnel and their remuneration for the period is disclosed at note 9.  Transactions with directors are disclosed at note 27.


29.


Post balance sheet events

The business started construction of their new depot in the West of Scotland during May 2024 with plans to complete the project during 2025. The construction of the new depot will be financed with bank loans secured against other business properties. 


Page 28