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Registered number: 00539713









CLARKES OF WALSHAM LIMITED

ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023






































Whitings LLP
Chartered Accountants
Greenwood House
Greenwood Court
Skyliner Way
Bury St Edmunds
Suffolk
IP32 7GY

 
CLARKES OF WALSHAM LIMITED
 
 
COMPANY INFORMATION


Directors
B L Clarke 
M J Clarke 
H N Clarke 
Mrs I O Clarke 
N J Elers 
R J Balls 




Company secretary
R J Balls



Registered number
00539713



Registered office
The High Street
Walsham-le-Willows

Bury St Edmunds

Suffolk

IP31 3BA




Independent auditors
Whitings LLP

Greenwood House

Greenwood Court

Skyliner Way

Bury St Edmunds

Suffolk

IP32 7GY




Bankers
Lloyds Bank
9 Butter Market

Bury St Edmunds

Suffolk

IP33 1DB




Solicitors
Ashtons Legal
The Long Barn

Fornham Business Centre

Fornham St Martin

Bury St Edmunds

Suffolk

IP31 1SL





 
CLARKES OF WALSHAM LIMITED
 

CONTENTS



Page
Strategic Report
1
Directors' Report
2 - 3
Independent Auditors' Report
4 - 7
Statement of Comprehensive Income
8
Balance Sheet
9 - 10
Statement of Changes in Equity
11
Statement of Cash Flows
12
Analysis of Net Debt
13
Notes to the Financial Statements
14 - 28


 
CLARKES OF WALSHAM LIMITED
 
 
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

Introduction
 
The directors present their strategic report on the company for the year ended 31 December 2023.

Business review
 
The result for the year is disappointing, although mainly influenced by several external factors occurring at the same time.
Price deflation was present throughout the year resulting in the decrease in gross margin of 3.1%. 
Like many businesses, energy and fuel costs rose to record levels, with a 154% increase in 2023.
Wage costs, fuelled by the national minimum wage, increased by 9.68%. 
The sale of an investment property resulted in a loss on disposal based on a previous valuation.
By the year end, gross margin had stabilised with the return of price inflation across many of the company’s main product lines and energy costs had reduced significantly. This, together with prudent management of other overheads, should give a satisfactory result in 2024 despite the challenging economic climate.  

Principal risks and uncertainties
 
The company's performance is influenced by broad economic conditions as well as those in the agricultural and building sectors.
Competition in the builders merchant market is largely from national suppliers. Competitor activity can affect the performance of the company.

Financial key performance indicators
 
The key financial performance indicators are turnover, gross profit margin and net profit before tax. Turnover has increased by 1% from £12,322,785 in 2022 to £12,460,737 and gross profit margin has decreased from 36.3% in 2022 to 33.2%. Net profit/(loss) before tax has decreased from profit of £440,224 in 2022 to a loss of £313,557.

Future Developments
 
Clarkes will continue to build on it’s unique business of serving the agricultural, building and retail sectors as it has done for the past 116 years.
The company continues to trade successfully with ongoing investment in many areas of the business.


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



R J Balls
Director

Date: 7 June 2024

Page 1

 
CLARKES OF WALSHAM 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;

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 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 loss for the year, after taxation, amounted to £243,425 (2022 - profit £341,435).

Particulars of dividends paid are detailed in note 12 to the financial statements.

Directors

The directors who served during the year were:

B L Clarke 
M J Clarke 
H N Clarke 
Mrs I O Clarke 
N J Elers 
R J Balls 


Future developments

Future developments are included in the Strategic Report.

Page 2

 
CLARKES OF WALSHAM 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

There have been no significant events affecting the Company since the year end.

Auditors

The auditorsWhitings LLPwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

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





R J Balls
Director

Date: 7 June 2024

Page 3

 
CLARKES OF WALSHAM LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CLARKES OF WALSHAM LIMITED
 

Opinion


We have audited the financial statements of Clarkes of Walsham Limited (the 'Company') for the year ended 31 December 2023, which comprise the Statement of Comprehensive Income, the Balance Sheet, 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 loss for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


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 4

 
CLARKES OF WALSHAM LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CLARKES OF WALSHAM 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 2, 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 5

 
CLARKES OF WALSHAM LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CLARKES OF WALSHAM 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:
 
Enquiry of management about any known or suspected instances of non-compliance with laws and regulations, accidents in the workplace, and fraud;
Enquiry of management around actual and potential litigation and claims;
Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations;
Challenging assumptions and judgements made by management in their significant accounting estimates; and 
Performing audit work over the risk of management override of controls, including testing of journal entries and other adjustments for appropriateness, and evaluating the business rationale of significant transactions outside the course of normal business.


Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.


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 6

 
CLARKES OF WALSHAM LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CLARKES OF WALSHAM 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.





Jonathan Moore (Senior Statutory Auditor)
  
for and on behalf of
Whitings LLP
 
Greenwood House
Greenwood Court
Skyliner Way
Bury St Edmunds
Suffolk
IP32 7GY

7 June 2024
Page 7

 
CLARKES OF WALSHAM LIMITED
 
 
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
Note
£
£

  

Turnover
 4 
12,460,737
12,322,785

Cost of sales
  
(8,326,063)
(7,858,010)

Gross profit
  
4,134,674
4,464,775

Administrative expenses
  
(4,469,526)
(4,028,277)

Other operating income
 5 
1,680
3,270

Operating (loss)/profit
 6 
(333,172)
439,768

Interest receivable and similar income
 9 
19,811
652

Interest payable and similar expenses
 10 
(196)
(196)

(Loss)/profit before tax
  
(313,557)
440,224

Tax on (loss)/profit
 11 
70,132
(98,789)

(Loss)/profit for the financial year
  
(243,425)
341,435

There were no recognised gains and losses for 2023 or 2022 other than those included in the statement of comprehensive income.

There was no other comprehensive income for 2023 (2022:£NIL).

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

Page 8

 
CLARKES OF WALSHAM LIMITED
REGISTERED NUMBER: 00539713

BALANCE SHEET
AS AT 31 DECEMBER 2023

2023
2022
Note
£
£

Fixed assets
  

Tangible assets
 13 
1,494,673
1,663,037

Investment property
 14 
-
470,000

  
1,494,673
2,133,037

Current assets
  

Stocks
 15 
3,670,092
3,830,485

Debtors: amounts falling due within one year
 16 
998,567
926,483

Cash at bank and in hand
 17 
1,431,737
1,061,703

  
6,100,396
5,818,671

Creditors: amounts falling due within one year
 18 
(1,123,789)
(1,099,993)

Net current assets
  
 
 
4,976,607
 
 
4,718,678

Total assets less current liabilities
  
6,471,280
6,851,715

Creditors: amounts falling due after more than one year
 19 
(4,000)
(4,000)

Provisions for liabilities
  

Deferred tax
 21 
(178,040)
(276,035)

  
 
 
(178,040)
 
 
(276,035)

Net assets
  
6,289,240
6,571,680

Page 9

 
CLARKES OF WALSHAM LIMITED
REGISTERED NUMBER: 00539713
    
BALANCE SHEET (CONTINUED)
AS AT 31 DECEMBER 2023

2023
2022
Note
£
£

Capital and reserves
  

Called up share capital 
 22 
5,100
5,100

Share premium account
 23 
6,350
6,350

Capital redemption reserve
 23 
7,250
7,250

Investment property reserve
 23 
-
376,025

Profit and loss account
 23 
6,270,540
6,176,955

  
6,289,240
6,571,680


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 





H N Clarke
M J Clarke
Director
Director


Date: 7 June 2024

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

Page 10

 

 
CLARKES OF WALSHAM LIMITED


 

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



Share capital
Share premium account
Capital redemption reserve
Investment property revaluation reserve
Profit and loss account
Total equity


£
£
£
£
£
£



At 1 January 2022
5,100
6,350
7,250
392,583
5,857,977
6,269,260





Profit for the year
-
-
-
-
341,435
341,435


Dividends: Equity capital
-
-
-
-
(39,015)
(39,015)


Transfer of non distributable
-
-
-
-
16,558
16,558


  revaluation gains
-
-
-
(16,558)
-
(16,558)





At 1 January 2023
5,100
6,350
7,250
376,025
6,176,955
6,571,680





Loss for the year
-
-
-
-
(243,425)
(243,425)


Surplus on revaluation of freehold property
-
-
-
-
376,025
376,025


Dividends: Equity capital
-
-
-
-
(39,015)
(39,015)


  revaluation gains
-
-
-
(376,025)
-
(376,025)



At 31 December 2023
5,100
6,350
7,250
-
6,270,540
6,289,240



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

Page 11

 
CLARKES OF WALSHAM LIMITED
 

STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
£
£

Cash flows from operating activities

(Loss)/profit for the financial year
(243,425)
341,435

Adjustments for:

Depreciation of tangible assets
314,480
323,723

Loss on disposal of tangible assets
48,006
(25,136)

Interest paid
196
196

Interest received
(19,811)
(652)

Taxation charge
(70,132)
98,789

Decrease/(increase) in stocks
160,393
(365,998)

(Increase)/decrease in debtors
(70,238)
115,827

Increase/(decrease) in creditors
84,843
(343,397)

Corporation tax (paid)
(90,756)
(158,621)

Net cash generated from operating activities

113,556
(13,834)


Cash flows from investing activities

Purchase of tangible fixed assets
(175,823)
(300,949)

Sale of tangible fixed assets
(18,299)
38,350

Sale of investment properties
470,000
-

Interest received
19,811
652

Net cash from investing activities

295,689
(261,947)

Cash flows from financing activities

Dividends paid
(39,015)
(39,015)

Interest paid
(196)
(196)

Net cash used in financing activities
(39,211)
(39,211)

Net increase/(decrease) in cash and cash equivalents
370,034
(314,992)

Cash and cash equivalents at beginning of year
1,061,703
1,376,695

Cash and cash equivalents at the end of year
1,431,737
1,061,703


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
1,431,737
1,061,703


Page 12

 
CLARKES OF WALSHAM LIMITED
 

ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 DECEMBER 2023




At 1 January 2023
Cash flows
At 31 December 2023
£

£

£

Cash at bank and in hand

1,061,703

370,034

1,431,737

Debt due after 1 year

(4,000)

-

(4,000)


1,057,703
370,034
1,427,737

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

Page 13

 
CLARKES OF WALSHAM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

1.


General information

Clarkes of Walsham Limited are builders merchants supplying building, farming and garden materials. 
The company is a private company limited by shares and is incorporated in England. The address of its registered office is The Street, Walsham-Le-Willows, Bury St Edmunds, IP31 3BA.

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).
The following principal accounting policies have been applied:

 
2.2

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue 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 revenue is recognised:

Sale of goods

Revenue 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 revenue 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.

 
2.3

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.

Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.

The Company has taken advantage of the optional exemption available on transition to FRS 102 which allows lease incentives on leases entered into before the date of transition to the standard 01 January 2022 to continue to be charged over the period to the first market rent review rather than the term of the lease.

Page 14

 
CLARKES OF WALSHAM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.4

Interest income

Interest income is recognised in profit or loss using the effective interest method.

 
2.5

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

 
2.6

Pensions

The Company operates a group personal pension scheme for employees and money purchase pension schemes for certain directors. The assets of the scheme are held separately from those of the company. The annual contributions payable are charged to the Profit and Loss Account.

 
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 balance sheet 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 balance sheet 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 balance sheet 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.

Page 15

 
CLARKES OF WALSHAM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)


2.8
Tangible fixed assets (continued)

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method or reducing balance method.

Depreciation is provided on the following basis:

Freehold property
-
Over 50 years
Plant and machinery
-
Straight line method at 10% and 20%
Motor vehicles
-
Reducing balance method at 25%
Office equipment
-
Straight line method at 10%, 20% and 33%

 
2.9

Investment property

Investment properties are carried at fair value determined annually by the directors in conjunction with external valuers where appropriate. The surplus or deficit is recognised in the profit and loss account and accumulated as a non-distributable fair value reserve, other than for any deficit below original cost which is expected to be permanent.

 
2.10

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 first in, first out basis. Work in progress and finished goods include labour and attributable overheads.

At each balance sheet 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.

 
2.11

Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

 
2.12

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

In the Statement of Cash Flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Company's cash management.

 
2.13

Creditors

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

Page 16

 
CLARKES OF WALSHAM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.14

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.

 
2.15

Financial instruments

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.

Impairment of financial assets

Financial assets are assessed for indicators of impairment at each reporting date. 

Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.

If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.

Financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instruments any contract that evidences a residual interest in the assets of the Company after the deduction of all its liabilities.

Basic financial liabilities, which include trade and other payables, bank loans and other loans are initially measured at their transaction price after transaction costs. When this constitutes a financing transaction, whereby the debt instrument 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.

Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.

Page 17

 
CLARKES OF WALSHAM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)


2.15
Financial instruments (continued)

Trade payables are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade payables are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.

Derecognition of financial assets

Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Company transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Company will continue to recognise the value of the portion of the risks and rewards retained.

Derecognition of financial liabilities

Financial liabilities are derecognised when the Company's contractual obligations expire or are discharged or cancelled.

 
2.16

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.

Dividends on shares recognised as liabilities are recognised as expenses and classified within interest payable.


3.


Judgments in applying accounting policies and key sources of estimation uncertainty

Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. 

The company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below.
Investment properties
Investment properties are valued annually by the directors in conjunction with professional valuers. There is, however, an inevitable degree of judgment involved in that each property is unique and value can only ultimately be reliably tested in the market itself.

Page 18

 
CLARKES OF WALSHAM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

4.


Turnover

All turnover arose within the United Kingdom.


5.


Other operating income

2023
2022
£
£

Net rents receivable
1,680
3,270

1,680
3,270



6.


Operating (loss)/profit

The operating (loss)/profit is stated after charging:

2023
2022
£
£

Depreciation charges
314,480
323,723

Fees payable to the Company's auditor and its associates for the audit of the Company's annual accounts
7,970
7,450

Fees payable to the Company's auditor and its associates for other services
5,675
5,168

Other operating lease rentals
118,222
74,866

Page 19

 
CLARKES OF WALSHAM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

7.


Employees

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


2023
2022
£
£

Wages and salaries
2,500,058
2,277,817

Social security costs
207,928
221,281

Cost of defined contribution scheme
102,405
103,882

2,810,391
2,602,980


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


        2023
        2022
            No.
            No.







Manufacturing staff
14
11



Distribution staff
44
41



Office and management staff
27
25

85
77


8.


Directors' remuneration

2023
2022
£
£

Directors' emoluments
398,325
466,498

Company contributions to defined contribution pension schemes
30,000
40,000

428,325
506,498


During the year retirement benefits were accruing to 4 directors (2022 - 4) in respect of defined contribution pension schemes.

The highest paid director received remuneration of £100,438 (2022 - £122,014).

The value of the Company's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to £5,000 (2022 - £10,000).

Page 20

 
CLARKES OF WALSHAM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

9.


Interest receivable

2023
2022
£
£


Other interest receivable
19,811
652


10.


Interest payable and similar expenses

2023
2022
£
£


Preference share dividends
196
196


11.


Taxation


2023
2022
£
£

Corporation tax


Current tax on profits for the year
27,863
88,886


Total current tax
27,863
88,886

Deferred tax


Origination and reversal of timing differences
(97,995)
(6,655)

Changes to tax rates
-
16,558

Total deferred tax
(97,995)
9,903


Taxation on (loss)/profit on ordinary activities
(70,132)
98,789
Page 21

 
CLARKES OF WALSHAM 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 lower than (2022 - higher than) the standard rate of corporation tax in the UK of 19-25% (2022 - 19%). The differences are explained below:

2023
2022
£
£


(Loss)/profit on ordinary activities before tax
(313,557)
440,224


(Loss)/profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 19-25% (2022 - 19%)
(14,895)
83,643

(Loss)/profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25%
(58,855)
-

(73,750)
83,643

Effects of:


Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
6,261
5,781

Short term timing difference leading to an increase (decrease) in taxation
-
6,988

Adjust deferred tax provision to 25% leading to an increase (decrease) in the tax charge
(1,232)
2,377

Marginal relief
(1,411)
-

Total tax charge for the year
(70,132)
98,789


Factors that may affect future tax charges

The main rate of UK corporation tax increased from 19% to a rate between 19% and 25% with effect from 1 April 2023. The corporation tax charge for the year has been calculated at these rates. The deferred tax liability has been provided at 25%.


12.


Dividends

2023
2022
£
£


Paid on ordinary shares

39,015
39,015


Paid on shares classed as debt

196
196

Page 22

 
CLARKES OF WALSHAM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

13.


Tangible fixed assets





Freehold property
Plant and machinery
Motor vehicles
Office equipment
Total

£
£
£
£
£



Cost or valuation


At 1 January 2023
1,516,271
1,088,763
1,566,821
290,209
4,462,064


Additions
-
62,264
102,447
11,112
175,823


Disposals
-
(54,321)
(241,275)
-
(295,596)



At 31 December 2023
1,516,271
1,096,706
1,427,993
301,321
4,342,291



Depreciation


At 1 January 2023
572,452
903,595
1,114,471
208,509
2,799,027


Charge for the year on owned assets
31,699
89,824
131,276
61,681
314,480


Disposals
-
(54,321)
(211,568)
-
(265,889)



At 31 December 2023
604,151
939,098
1,034,179
270,190
2,847,618



Net book value



At 31 December 2023
912,120
157,608
393,814
31,131
1,494,673



At 31 December 2022
943,819
185,168
452,350
81,700
1,663,037

Included in land and buildings is freehold land at cost of £154,429 £ (2022 - £154,429) which is not depreciated.

Page 23

 
CLARKES OF WALSHAM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

14.


Investment property


Freehold investment property

£





At 1 January 2023
470,000


Disposals
(470,000)



At 31 December 2023
-

The 2023 valuations were made by the directors, on an open market value for existing use basis.

2023
2022
£
£

Revaluation reserves


At 1 January 2023
376,025
392,583

Transfer to profit and loss reserve
(376,025)
(16,558)

At 31 December 2023
-
376,025



If the Investment properties had been accounted for under the historic cost accounting rules, the properties would have been measured as follows:

2023
2022
£
£


Historic cost
-
24,988


15.


Stocks

2023
2022
£
£

Raw materials and consumables
5,173
12,612

Finished goods and goods for resale
3,664,919
3,817,873

3,670,092
3,830,485


Page 24

 
CLARKES OF WALSHAM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

16.


Debtors

2023
2022
£
£


Trade debtors
768,450
803,356

Other debtors
2,770
925

Prepayments and accrued income
227,347
122,202

998,567
926,483



17.


Cash and cash equivalents

2023
2022
£
£

Cash at bank and in hand
1,431,737
1,061,703



18.


Creditors: Amounts falling due within one year

2023
2022
£
£

Trade creditors
638,779
483,122

Corporation tax
27,839
88,886

Other taxation and social security
238,724
273,473

Other creditors
218,447
254,512

1,123,789
1,099,993


Disclosure of the terms and conditions attached to the non-equity shares is made in note 22.


19.


Creditors: Amounts falling due after more than one year

2023
2022
£
£

Share capital treated as debt
4,000
4,000


Page 25

 
CLARKES OF WALSHAM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

20.


Financial instruments

2023
2022
£
£

Financial assets


Financial assets measured at fair value through profit or loss
-
470,000




Financial assets measured at fair value through profit or loss comprise investment property.


21.


Deferred taxation




2023
2022


£

£






At beginning of year
(276,035)
(266,132)


Charged to the profit or loss
97,995
(9,903)



At end of year
(178,040)
(276,035)

The provision for deferred taxation is made up as follows:

2023
2022
£
£


Accelerated capital allowances
(128,934)
(157,943)

Revaluation
(49,106)
(118,092)

(178,040)
(276,035)


The net deferred tax expected to reverse next year is £23,621 (2022 - £69,632) relating to the reversal of timing differences on tangible fixed assets.

Page 26

 
CLARKES OF WALSHAM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

22.


Share capital

2023
2022
£
£
Shares classified as equity

Allotted, called up and fully paid



5,100 (2022 - 5,100) Ordinary shares of £1.00 each
5,100
5,100

Shares classified as debt

Allotted, called up and fully paid



4,000 (2022 - 4,000) Preference shares of £1.00 each
4,000
4,000


The preference shares entitle shareholders to one dividend of 4.9% which is deemed to be payable on the 1st day of January each year.
The preference shares have no voting rights unless the dividend thereon is three months in arrears. On winding up the company, assets remaining after payment of all debts and liabilities shall be applied first to the repayment of preference shares.


23.


Reserves

Share premium account

This reserve records the amount above the nominal value received for shares issued, less transaction costs.

Capital redemption reserve

This reserve records the nominal value of shares repurchased by the company.

Investment property revaluation reserve

This reserve records non-distributable gains arising on revaluation of investment properties.

Profit and loss account

The profit and loss account represents retained profits available for distribution.


24.


Pension commitments

The Company operates a defined contributions pension scheme for employees and money purchase pension schemes for certain directors. The assets of the schemes are held separately from those of the Company in independently administered funds. The pension cost charge represents contributions payable by the Company to the funds and amounted to £102,405 (2022 - £103,882).

Page 27

 
CLARKES OF WALSHAM LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

25.


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
80,193
91,609

Later than 1 year and not later than 5 years
259,783
249,418

Later than 5 years
-
36,000

339,976
377,027


26.


Related party transactions

During the year dividends were paid to directors as follows:
Ordinary  £39,015                                               
Preference  £196
 


27.


Controlling party

The company is under the control of its directors who are the shareholders.

 
Page 28