Company registration number:
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COMPANY INFORMATION
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CONTENTS
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GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 MAY 2023
The directors present their strategic report of the company and the group for the year ended 31 May 2023.
There has been a significant increase in turnover and gross profit margins following the acquisition of a new subsidiary, Cropnosys India Private Limited in the prior year.The financial year ended 31 May 2023 sees a full year of Cropnosys India Private Limited's results in the Group financial statements.
The group's key financial and other performance indicators during the year were as follows:
The directors have considered the principal risks and uncertainties affecting the group as at the balance sheet date and up to the date of this report.
The group's operations expose it to a variety of financial risks that include the effects of changes in credit risk and liquidity risk. The group has debt finance but does not use derivative financial instruments to manage interest rates and as such, no hedge accounting is applied. The group's financial instruments comprise cash and liquid resources, various items such as trade debtors, trade creditors etc, that arise directly from its operations. The main purpose of these financial instruments is to raise finance for the group's operations. It is, and has been throughout the period under review, the group's policy that no trading in financial instruments shall be undertaken. The main risks arising from the group's financial instruments are market risk, credit risk, business and operational risk. Market risk Market risk includes failure to anticipate the pricing and market changes. External influences, such as fluctuations in commodity prices, foreign currency exchange rates and currency values could have a material adverse effect on our result of operation and financial position. The group seeks to manage the risk through diversification of its portfolio of products, geographies into which it sells and the currencies in which it operates. Credit risk The group trades only with recognised, creditworthy third parties. It is the group's policy that all customers who wish to trade on credit terms are subject to credit vetting procedures. In addition, receivables balances are monitored on an ongoing basis with the result that the group's exposure to bad debts is not significant. Business and Operational risk We sell our products in competitive markets, and the success of our competitive strategy depends on our products and retaining customers and distributors. The group manages business and operational risk by ensuring adequate operating margins are maintained.
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GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
Section 172 of the Companies Act requires Directors to take into consideration the interests of stakeholders and other matters in their decision making. The Board considers that the decisions they have made during the financial year and the way they have acted have been in the best interests of stakeholders and related parties, having regard for matters set out in s172(1) (a-f) of the Act.
The Board acts in good faith and in a manner that they consider promotes the long-term success of the business for the benefit of its stakeholders. The directors are constantly exploring opportunities to generate additional business. The company’s key stakeholders are its internal staff, clients, and suppliers. The company engages with its employees, clients and suppliers through several means including:
∙Employees: internal updates on the company’s development, client relationship building, and employee training and development
∙Clients: providing support and advice to clients to build sustainable long-term business relationships to help them achieve their goals and objectives.
∙Suppliers: Effective communications and updates on contracts to develop sustainable long-term business relationships.
This report was approved by the board and signed on its behalf.
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DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MAY 2023
The directors present their report and the financial statements for the year ended 31 May 2023.
The directors are responsible for preparing the Group strategic report, the Directors' report and the consolidated financial statements in accordance with applicable law and regulations.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the Group's financial statements and then apply them consistently;
∙make judgements and accounting estimates that are reasonable and prudent;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group 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 the Group and to 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 the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The profit for the year, after taxation and minority interests, amounted to £10,137,198 (2022: £4,100,519).
Dividends paid in the year amounted to £40,800 (2022: £73,800).
The directors who served during the year were:
It is Group policy to agree and clearly communicate the terms of payment as part of commercial arrangements negotiated with suppliers and then to pay according to those terms based upon the timely receipt of an accurate invoice.
Trade creditor days of the Group for the year ended 31 May 2023 were 66 days (2022: 158 days), calculated as the ratio, expressed in days, between the amounts invoiced to the Company by its suppliers in the year and the amounts due to trade creditors at the year end.
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DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
The provision of high-level information to staff is maintained through regular communications. Members of the management team regularly visit branches and discuss relevant business issues with members of staff and a programme of regular staff consultative committee meetings is followed.
The directors regularly monitor key supplier relationships, relevant developments and engagement activities. Contracts and activity with customers have been reviewed by the directors in the context of the relevant transactions.
The directors have always paid special attention to issues related to customers and suppliers. During the year ended 31 May 2023, the directors regularly monitor the performance of customers and suppliers and the impacts on them of the wider macroeconomic and geopolitical environment.
The Group's greenhouse gas emissions and energy consumption for the year are:
2023 2022 Energy consumption kWh kWh Aggregate of energy consumption in the year 2,959,429 2,755,402 2023 2022 Emissions of CO2 equivalent metric tonnes metric tonnes Scope 1 - direct emissions - Production of products 8,452 8,464 Intensity ratio Total gross (CO2e/Turnover (£m) 76 202
The reporting period is the most recent financial year 01/06/2022 to 31/05/2023. This report has been compiled in line with the March 2019 BEIS 'Environmental Reporting Guidelines: Including streamlined energy and carbon reporting guidance', and the EMA methodology for SECR Reporting.
All measured emissions from activities which the organisation has financial control over are included as required under The Companies (Directors' Report) and Limitation Liability Partnerships (Energy and Carbon Report) Regulations 2018, unless otherwise stated in the exclusions statement below. The carbon figures have been calculated using the Department for Business Energy and Industrial Strategy 2023 carbon conversion factors for all fuels, other than the market-based electricity which has been taken from the relevant UK suppliers.
The chosen intensity measurement ratio is total gross emissions in metric tonnes CO2e per £1m turnover.
The principal risks and uncertainties that the group is exposed to in respect of foreign currency risk, liquidity risk and credit risk have been disclosed in the strategic report.
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DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
The auditors, Menzies LLP, will 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.
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF WIDECOVER LIMITED
We were engaged to audit the financial statements of Widecover Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 May 2023, which comprise the Consolidated income statement, the Consolidated statement of comprehensive income, the Consolidated balance sheet, the Company balance sheet, the Consolidated statement of cash flows, the Consolidated statement of changes in equity, the Company statement of changes in equity and the related notes, including a summary of 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 relation to the Group’s subsidiary, Cropnosys India Private Limited, we were unable to obtain sufficient appropriate audit evidence regarding the work undertaken on this significant component by the component auditor. The component auditor refused to share audit working papers meaning we were unable to review the audit work completed in respect of the significant component. We were unable to satisfy ourselves by alternative means concerning the component auditor's work or the financial information of the component. Consequently, we were unable to determine whether any adjustments might have been necessary in respect of the component's financial information included in the consolidated financial statements.
We have issued a disclaimer of opinion on the basis that the Group’s subsidiary, Cropnosys India Private Limited, is deemed a significant component to the Group, as the subsidiary represents 66% of Group turnover and 84% of the Group’s gross assets.
Because of the significance of the matter described in the basis for disclaimer of opinion section of our report, we have been unable to form an opinion, whether based on the work undertaken in the course of the audit:
∙the information given in the strategic report and 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.
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF WIDECOVER LIMITED (CONTINUED)
Notwithstanding our disclaimer of an opinion on the financial statements, in the light of the knowledge and understanding of the Group and the parent Company and its environment obtained in the course of the audit performed subject to the pervasive limitation described above, we have not identified material misstatements in the Group strategic report and the Directors' report.
Arising from the limitation of our work referred to above:
∙we have not obtained all the information and explanations that we considered necessary for the purposes of our audit; and
∙returns adequate for our audit have not been received from branches not visited by us.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you, if in our opinion:
∙adequate accounting records have not been kept by the parent Company;
∙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.
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF WIDECOVER LIMITED (CONTINUED)
Our responsibility is to conduct an audit of the statements in accordance with International Standards on Auditing (UK) and to issue an auditor’s report.
However, because of the matter described in the basis for disclaimer of opinion section of our report, we were not able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on these financial statements.
We are independent of the Group and 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.
Other matters
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:
The Group is subject to laws and regulations that directly affect the financial statements including financial reporting legislation. We determined that the following laws and regulations were most significant including:
∙The Companies Act 2006;
∙Financial Reporting Standard 102;
∙UK employment legislation
∙General Data Protection Regulations; and
∙UK tax legislation
We assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items.
We understood how the Group is complying with those legal and regulatory frameworks by, making inquiries to management and those responsible for legal and compliance procedures.
The engagement partner assessed whether the engagement team collectively had the appropriate competence and capabilities to identify or recognize non-compliance with laws and regulations. The assessment did not identify any issues in this area.
We assessed the susceptibility of the Group’s financial statements to material misstatement, including how fraud might occur. Audit procedures performed by the engagement team included:
∙Identifying and assessing the design effectiveness of controls management has in place to prevent and detect fraud;
∙Understanding how those charged with governance considered and addressed the potential for override of controls other inappropriate influence over the financial reporting process;
∙Challenging assumptions and judgements made by management in its significant accounting estimates; and
∙Identifying and testing journal entries, in particular any journal entries posted with unusual account combinations.
As a result of the above procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in the following areas:
∙The application of inappropriate judgements or estimation to manipulate the Group’s financial position;
∙Posting unusual journals and complex transactions, particularly in the period during which adequate accounting records were not maintained; and
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INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF WIDECOVER LIMITED (CONTINUED)
∙The use of management override of controls to manipulate results, or to cause the Group to enter into transactions not in its best interests.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation. As outlined in the basis for disclaimer of opinion section of our report, there have been limitations to the information available to us during the course of our audit of the Group's financial statements for the year ended 31 May 2023, which have further limited our ability to detect and identify 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.
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 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.
for and on behalf of
Chartered Accountants
Statutory Auditor
Lynton House
7-12 Tavistock Square
London
WC1H 9LT
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CONSOLIDATED INCOME STATEMENT
FOR THE YEAR ENDED 31 MAY 2023
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CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MAY 2023
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CONSOLIDATED BALANCE SHEET
AS AT 31 MAY 2023
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CONSOLIDATED BALANCE SHEET (CONTINUED)
AS AT 31 MAY 2023
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 20 to 41 form part of these financial statements.
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COMPANY BALANCE SHEET
AS AT 31 MAY 2023
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 20 to 41 form part of these financial statements.
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CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MAY 2023
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COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MAY 2023
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CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MAY 2023
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CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
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CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 MAY 2023
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2023
Widecover Limited is a private company, limited by shares, registered in England and Wales. The company's registered number and registered office address can be found on the General Information page.
2.Accounting policies
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 Group management to exercise judgement in applying the Group's accounting policies (see note 3).
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Income statement in these financial statements.
The following principal accounting policies have been applied:
The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Balance sheet, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated income statement from the date on which control is obtained. They are deconsolidated from the date control ceases.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2023
2.Accounting policies (continued)
Functional and presentation currency
Transactions and balances
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2023
2.Accounting policies (continued)
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2023
2.Accounting policies (continued)
Goodwill
Other intangible assets
All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the following methods..
Depreciation is provided on the following basis:
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.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2023
2.Accounting policies (continued)
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
Financial instruments are recognised in the Group's Balance sheet when the Group 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
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2023
2.Accounting policies (continued)
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 Group's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.
Other financial assets
Other financial assets, which includes investments in equity instruments which are not classified as subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the recognised transaction price. Such assets are subsequently measured at fair value with the changes in fair value being recognised in the profit or loss. Where other financial assets are not publicly traded, hence their fair value cannot be measured reliably, they are measured at cost less impairment.
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 Group after the deduction of all its liabilities.
Basic financial liabilities, which include trade and other payables, bank loans, other loans and loans due to fellow group companies 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.
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.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2023
Significant judgements Management are of the opinion that there are no significant judgements (apart from those involving estimations) made in the process of applying the entity's accounting policies. Key sources of estimation uncertainty Accounting estimates and assumptions are made concerning the future and, by their nature, will rarely equal the related actual outcome. The key assumptions and other sources of estimation uncertainty that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are as follows: Impairment of subsidiary Determining whether an investment is impaired requires an estimation of its fair value. This is based on the future operating performance of the individual entities. Tangible fixed assets
Analysis of turnover by country of destination:
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NOTES TO THE FINANCIAL STATEMENTS
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2023
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2023
12.Taxation (continued)
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Income statement in these financial statements. The profit after tax of the parent Company for the year was £
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NOTES TO THE FINANCIAL STATEMENTS
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2023
16.Tangible fixed assets (continued)
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FOR THE YEAR ENDED 31 MAY 2023
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2023
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2023
Amounts above within Trade creditors are due to HSBC invoice discounting account and is secured on the company Trade debtors.
Details of the security provided for bank loans can be found in note 24.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2023
Details of the security provided for bank loans can be found in note 24.
Please provide details of the terms of payment or repayment and the rates of any interest payable on the amounts repayable more than five years after the balance sheet date.
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FOR THE YEAR ENDED 31 MAY 2023
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2023
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2023
Profit and loss account
A Group guarantee has been given in favour of HSBC Bank by Widecover Limited, Cropthetics Limited, JT Agro Limited, J T Grosvenor Limited and Widecover Holdings Limited guaranteeing the obligations for each other to the bank.
A Group guarantee has also been given in favour of HSBC Bank by Widecover Limited and Widecover Holdings Limited guaranteeing the obligations for each other to the bank. Cropthetics Limited and JT Agro Limited are related by virtue of common control.
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2023
The parent company has a combined limit for export and import line facility of USD $6,500,000 with HSBC Bank Plc. These are secured by debentures including fixed charge over all recent freehold and leasehold property; first fixed charge over book and other debts, chattels, goodwill and uncalled capital, both present and future; and first floating charge over all assets and undertaking both present and future.
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