Company Registration No. 06961589 (England and Wales)
SOFAS & STUFF LIMITED
ANNUAL REPORT AND CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
SOFAS & STUFF LIMITED
COMPANY INFORMATION
Directors
A J Cussins
B M Cussins
J H Cussins
S J Cussins
(Appointed 22 April 2024)
G A Cussins
(Appointed 22 April 2024)
Secretary
E T Whitley
Company number
06961589
Registered office
The Dairy
Tripp Hill Farm Buildings
Fittleworth
Pulborough
West Sussex
RH20 1ER
Auditor
PKF Francis Clark
Unit 18 23, Melville Building East
Royal William Yard
Plymouth
Devon
PL1 3GW
SOFAS & STUFF LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Directors' responsibilities statement
5
Independent auditor's report
6 - 9
Profit and loss account
10
Group statement of comprehensive income
11
Group balance sheet
12
Company balance sheet
13
Group statement of changes in equity
14
Company statement of changes in equity
15
Group statement of cash flows
16
Notes to the financial statements
17 - 33
SOFAS & STUFF LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -

The directors present the strategic report for the year ended 31 December 2023.

Fair review of the business

 

Sofas & Stuff is a family business, run single mindedly for the long term. This means we take decisions that are right for the medium term, whilst not being obsessed with the next 6 to 12 months results. Getting the building blocks in place to create a world class company is our only raison d’etre.

In essence we have three divisions - retail, logistics, and manufacturing. 2023 was a year that our industry saw trading levels very much fall back to pre-lockdown numbers. At S&S our retail division traded somewhat better than the industry in general, which is a pattern that has continued well into the first half of 2024. We put this down to our extremely high levels of service in store, our unique brand, and the fact that our better off customers have been less hard hit by the well advertised national “spending crisis.”

Our logistics division, based in Milton Keynes, continues to offer a great delivery experience to our customers. We view this as essential, this being the last physical touch point we have with them, and a poor service at this point can undo all the good work put in by retail earlier in the buying process. Our customer reviews of this service, like all aspects of the business, are monitored weekly, and continue to pleasantly surprise with their tone of voice.

Finally, to manufacturing, our most recent serious investment. Being in control of product quality and delivery lead times, was the reason we decided to set up from scratch some two and a half years ago a manufacturing plant in Preston. Now making nearly 70 % of everything retail requires, and following a tough couple of years getting everything right, our manufacturing unit is now one of the things that makes the board most proud, because it has given the business another tool to enable it to answer our beloved customers needs.

 

Principal risks and uncertainties

 

The principal risk must be a drop in consumer confidence driven by rapidly rising inflation and increased interest costs. Being at the premium end of the sofa and fabric market may mean that these factors will play out less strongly than for some players where being the cheapest is their only point of difference.

 

Sales may also be affected in the summer months by the desire of our core customer to leave our shores for sunnier climes, as opposed to spending their holiday money on home improvements as has been the case over the last 24 months.

 

Sofas & Stuff is a business built on colleagues offering the very highest level of customer service it is possible to achieve. We are a people business pure and simple, and colleagues, customers and suppliers are what we are all about. As such, I personally would like to thank every one of my 195 colleagues for their endless supply of humour, hard work resilience and sheer talent, over the last 12 months. You are a constant source of inspiration.

Key performance indicators

 

The directors monitor the performance of the company on the following Key Performance Indicators ("KPl's") - sales, profit margins, overall company profitability and cash generated.

 

Sales - sales have reduced from £26.8m to £25.9m.

 

Gross profit margin has increased from 61.8% to 62.1%

 

Operating profit decreased from £2,022,822 to £966,337.

 

Bank and cash balances at the year end decreased from £3,108,276 to £1,065,768.

 

Net assets have decreased from £4,120,863 to £3,662,350.

SOFAS & STUFF LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -

On behalf of the board

A J Cussins
Director
3 September 2024
SOFAS & STUFF LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -

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

Principal activities

The principal activity of the company and group continued to be that of the production and sale of household furniture.

Results and dividends

The results for the year are set out on page 10.

Dividends paid to minority shareholders of subsidiary companies amounted to £135,000 for the year (2022 £183,000).

 

During the year a dividend of £1,000,000 was paid to the ordinary shareholders of the company.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

A J Cussins
B M Cussins
J H Cussins
S J Cussins
(Appointed 22 April 2024)
G A Cussins
(Appointed 22 April 2024)
Auditor

In accordance with the company's articles, a resolution proposing that PKF Francis Clark be reappointed as auditor of the group will be put at a General Meeting.

Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the auditor of the company is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the auditor of the company is aware of that information.

Going Concern

The financial statements have been prepared on a going concern basis. The Group has made a profit of £676,487 for the year ended 31 December 2023 (2022: profit of £1,332,798) and is in a net asset position of £3,662,350 (2022: £4,120,863).

The directors have reviewed the Group's forecast and projections for 2024 including assumptions concerning forecast sales, capital expenditure and expenditure commitments and their impact on cash flows, and have a reasonable expectation that the Group has adequate financial resources to continue its operations for the foreseeable future.

The directors have run various scenarios and stress tests for the coming year, depending on different levels of demand and therefore sales. They conclude that even if there is considerable downside to the 2024 budget, the Group will still have the necessary liquidity to continue trading.

The major long term creditor is a bank loan secured under the coronavirus business interruption loan scheme and the repayments on this is not a problem under the current forecasts.

The Directors are closely monitoring the impact of the cost of living crisis on the Group's performance and its ability to continue as a going concern. To date, indicators are that performance be strong and with the measures that management have put in place the Directors judge that the Group will continue to operate as a going concern.

SOFAS & STUFF LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 4 -
Medium-sized companies exemption

This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.

On behalf of the board
A J Cussins
Director
3 September 2024
SOFAS & STUFF LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 5 -

The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the group and company, and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

 

 

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

SOFAS & STUFF LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF SOFAS & STUFF LIMITED
- 6 -
Opinion

We have audited the financial statements of Sofas & Stuff Limited (the 'parent company') for the year ended 31 December 2023, which comprise the group profit and loss account, the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 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:

 

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 Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

 

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the director's 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 original financial statements were 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.

 

Other information

The directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

 

In connection with our audit of the financial statements, 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 audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. 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.

 

SOFAS & STUFF LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SOFAS & STUFF LIMITED
- 7 -

Opinions 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 Directors' Report for the financial period for which the financial statements are prepared is consistent with the financial statements; and

• the Directors' Report has been prepared in accordance with applicable legal requirements.

 

Matters on which we are required to report by exception

In the light of our knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Directors' Report.

 

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:

 

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page 5, 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.

 

SOFAS & STUFF LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SOFAS & STUFF LIMITED
- 8 -
Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

 

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

 

Based on our understanding of the company and industry, we identified that the principal risks of non-compliance with laws and regulations related to acts by the company which were contrary to applicable laws and regulations, including fraud.

 

We considered those laws and regulations that have a direct impact on the preparation of the financial statements, including, but not limited to the reporting framework (FRS 102 and Companies Act 2006) and the relevant tax compliance regulations in the UK. We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to fraudulent financial reporting.

 

Audit procedures performed by the engagement team include, but were not limited to, discussion and inquiries with management of compliance with laws and regulations and review of correspondence and contracts with third parties. We also addressed the risk of management override of internal controls, including testing of journals and evaluating whether there was evidence of bias by the Directors that represented a risk of material misstatement due to fraud.

 

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. This risk increases the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements as we are less likely to be come aware of instances of non-compliance. 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, collusion, omission or misrepresentation.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

 

 

 

 

 

 

 

 

 

SOFAS & STUFF LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SOFAS & STUFF LIMITED
- 9 -

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 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

 

Duncan Leslie (Senior Statutory Auditor)
For and on behalf of PKF Francis Clark
5 September 2024
Chartered Accountants
Statutory Auditor
Unit 18 23, Melville Building East
Royal William Yard
Plymouth
Devon
PL1 3GW
SOFAS & STUFF LIMITED
GROUP PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 10 -
2023
2022
Notes
£
£
Turnover
3
25,959,848
26,790,322
Cost of sales
(9,848,403)
(10,224,217)
Gross profit
16,111,445
16,566,105
Distribution costs
(681,065)
(695,124)
Administrative expenses
(14,464,043)
(13,856,155)
Other operating income
3
-
7,996
Operating profit
4
966,337
2,022,822
Interest receivable and similar income
8
18,893
349
Interest payable and similar expenses
9
(22,879)
(52,835)
Amounts written off investments
10
(52,770)
(245,231)
Profit before taxation
909,581
1,725,105
Tax on profit
11
(233,094)
(392,307)
Profit for the financial year
676,487
1,332,798
Profit for the financial year is attributable to:
- Owners of the parent company
609,804
1,219,579
- Non-controlling interests
66,683
113,219
676,487
1,332,798
SOFAS & STUFF LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
2023
2022
£
£
Profit for the year
676,487
1,332,798
Other comprehensive income
-
-
Total comprehensive income for the year
676,487
1,332,798
Total comprehensive income for the year is attributable to:
- Owners of the parent company
609,804
1,219,579
- Non-controlling interests
66,683
113,219
676,487
1,332,798
SOFAS & STUFF LIMITED
GROUP BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 12 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
13
4,211,394
4,106,858
Investments
14
52,771
105,541
4,264,165
4,212,399
Current assets
Stocks
16
2,688,502
2,882,927
Debtors
17
2,050,155
2,338,194
Cash at bank and in hand
1,065,768
3,108,276
5,804,425
8,329,397
Creditors: amounts falling due within one year
18
(5,564,276)
(7,439,954)
Net current assets
240,149
889,443
Total assets less current liabilities
4,504,314
5,101,842
Creditors: amounts falling due after more than one year
19
(64,321)
(219,214)
Provisions for liabilities
Deferred tax liability
21
777,643
761,765
(777,643)
(761,765)
Net assets
3,662,350
4,120,863
Capital and reserves
Called up share capital
23
25,781
25,781
Profit and loss reserves
3,606,630
4,063,967
Equity attributable to owners of the parent company
3,632,411
4,089,748
Non-controlling interests
29,939
31,115
3,662,350
4,120,863

These financial statements have been prepared in accordance with the provisions relating to medium-sized groups.

The financial statements were approved by the board of directors and authorised for issue on 3 September 2024 and are signed on its behalf by:
03 September 2024
A J Cussins
Director
Company registration number 06961589 (England and Wales)
SOFAS & STUFF LIMITED
COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2023
31 December 2023
- 13 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
13
4,210,169
4,104,948
Investments
14
63,871
116,641
4,274,040
4,221,589
Current assets
Stocks
16
2,688,502
2,882,927
Debtors
17
2,031,659
2,320,736
Cash at bank and in hand
1,056,502
3,104,079
5,776,663
8,307,742
Creditors: amounts falling due within one year
18
(5,610,528)
(7,526,355)
Net current assets
166,135
781,387
Total assets less current liabilities
4,440,175
5,002,976
Creditors: amounts falling due after more than one year
19
(64,321)
(219,214)
Provisions for liabilities
Deferred tax liability
21
777,643
761,765
(777,643)
(761,765)
Net assets
3,598,211
4,021,997
Capital and reserves
Called up share capital
23
25,781
25,781
Profit and loss reserves
3,572,430
3,996,216
Total equity
3,598,211
4,021,997

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £576,214 (2022 - £1,048,748 profit).

These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.

The financial statements were approved by the board of directors and authorised for issue on 3 September 2024 and are signed on its behalf by:
03 September 2024
A J Cussins
Director
Company registration number 06961589 (England and Wales)
SOFAS & STUFF LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 14 -
Share capital
Profit and loss reserves
Total controlling interest
Non-controlling interest
Total
Notes
£
£
£
£
£
Balance at 1 January 2022
25,781
2,901,286
2,927,067
53,998
2,981,065
Year ended 31 December 2022:
Profit and total comprehensive income
-
1,219,579
1,219,579
113,219
1,332,798
Dividends
12
-
(46,898)
(46,898)
(136,102)
(183,000)
Purchase of shares in subsidiary from non-controlling interest
-
(10,000)
(10,000)
-
(10,000)
Balance at 31 December 2022
25,781
4,063,967
4,089,748
31,115
4,120,863
Year ended 31 December 2023:
Profit and total comprehensive income
-
609,804
609,804
66,683
676,487
Dividends
12
-
(1,067,141)
(1,067,141)
(67,859)
(1,135,000)
Balance at 31 December 2023
25,781
3,606,630
3,632,411
29,939
3,662,350
SOFAS & STUFF LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 15 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 January 2022
25,781
2,947,468
2,973,249
Year ended 31 December 2022:
Profit and total comprehensive income for the year
-
1,048,748
1,048,748
Balance at 31 December 2022
25,781
3,996,216
4,021,997
Year ended 31 December 2023:
Profit and total comprehensive income
-
576,214
576,214
Dividends
12
-
(1,000,000)
(1,000,000)
Balance at 31 December 2023
25,781
3,572,430
3,598,211
SOFAS & STUFF LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 16 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
27
173,176
1,501,706
Interest paid
(22,879)
(52,835)
Income taxes refunded/(paid)
115
(387,041)
Net cash inflow from operating activities
150,412
1,061,830
Investing activities
Purchase of investment
-
(10,000)
Purchase of tangible fixed assets
(796,319)
(2,291,178)
Increase in loans made
-
(442)
Interest received
18,893
349
Net cash used in investing activities
(777,426)
(2,301,271)
Financing activities
Repayment of bank loans
(166,667)
(213,115)
Payment of finance leases obligations
(114,988)
(94,730)
Dividends paid to equity shareholders
(1,000,000)
-
Dividends paid to non-controlling interests
(135,000)
(183,000)
Net cash used in financing activities
(1,416,655)
(490,845)
Net decrease in cash and cash equivalents
(2,043,669)
(1,730,286)
Cash and cash equivalents at beginning of year
3,108,276
4,838,562
Cash and cash equivalents at end of year
1,064,607
3,108,276
Relating to:
Cash at bank and in hand
1,065,768
3,108,276
Bank overdrafts included in creditors payable within one year
(1,161)
-
SOFAS & STUFF LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 17 -
1
Accounting policies
Company information

Sofas & Stuff Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is The Dairy, Tripp Hill Farm Buildings, Fittleworth, Pulborough, West Sussex, RH20 1ER.

 

The group consists of Sofas & Stuff Limited and all of its subsidiaries.

1.1
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:

 

1.2
Basis of consolidation

The consolidated group financial statements consist of the financial statements of the parent company Sofas & Stuff Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.

 

All financial statements are made up to 31 December 2023. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

 

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.

SOFAS & STUFF LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 18 -
1.3
Going concern

The financial statements have been prepared on a going concern basis. The Group has made a profit of £676,487 for the year ended 31 December 2023 (2022: profit of £1,332,798) and is in a net asset position of £3,662,350 as at 31 December 2023 (2022: £ 4,120,863).

The directors have reviewed the Group's forecast and projections for 2024, including assumptions concerning forecast sales, capital expenditure and expenditure commitments and their impact on cash flows, and have a reasonable expectation that the Group has adequate financial resources to continue its operations for the foreseeable future.

The directors have run various scenarios and stress tests for the coming year, depending on different levels of demand and therefore sales. They conclude that even if there is considerable downside to the 2024 budget, the Group will still have the necessary liquidity to continue trading.

The major long term creditor is a bank loan secured under the coronavirus business interruption loan scheme and the repayments on this is not a problem under the current forecasts.

The Directors are closely monitoring the impact of the cost of living crisis on the Group's performance and its ability to continue as a going concern. To date, indicators are that performance be strong and with the measures that management have put in place the Directors judge that the Group will continue to operate as a going concern.

1.4
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

1.5
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Leasehold improvements
Over remaining term of the lease
Fixtures and fittings
25% reducing balance
Computer equipment
25% reducing balance
Motor vehicles
25% on cost
Website development
20% reducing balance

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.

SOFAS & STUFF LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 19 -
1.6
Fixed asset investments

Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.

 

In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

1.7
Impairment of fixed assets

At each reporting period end date, the group reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

 

The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

1.8
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

1.9
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

SOFAS & STUFF LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 20 -
1.10
Financial instruments

The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

 

Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Classification of financial liabilities

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

SOFAS & STUFF LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 21 -
Basic financial liabilities

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

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

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Derecognition of financial liabilities

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

1.11
Equity instruments

Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.

1.12
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

SOFAS & STUFF LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 22 -
1.13
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

 

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.14
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.15
Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

 

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

1.16
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

2
Judgements and key sources of estimation uncertainty

In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

 

 

 

 

 

 

 

 

 

 

SOFAS & STUFF LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 23 -
3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
25,522,750
26,680,482
Europe
105,161
106,478
Rest of the world
331,937
3,362
25,959,848
26,790,322

All the turnover relates to the production and sale of household furniture.

4
Operating profit
2023
2022
£
£
Operating profit for the year is stated after charging:
Exchange differences arising on trading tranactions
1,890
8,283
Depreciation of owned tangible fixed assets
606,896
364,353
Depreciation of tangible fixed assets held under finance leases
84,887
68,260
Operating lease charges
1,677,323
1,296,074
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
15,000
14,750
6
Employees

The average monthly number of persons (including directors) employed by the group and company during the year was:

Group
Company
2023
2022
2023
2022
Number
Number
Number
Number
195
158
169
130
SOFAS & STUFF LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
6
Employees
(Continued)
- 24 -

Their aggregate remuneration comprised:

Group
Company
2023
2022
2023
2022
£
£
£
£
Wages and salaries
7,494,441
7,044,126
6,945,015
6,404,281
Social security costs
794,516
810,218
745,605
749,054
Pension costs
178,096
209,926
170,141
199,427
8,467,053
8,064,270
7,860,761
7,352,762
7
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
817,073
1,677,949
Company pension contributions to defined contribution schemes
62,055
116,730
879,128
1,794,679

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 3 (2022 - 3).

Remuneration disclosed above includes the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
347,460
1,313,129
Company pension contributions to defined contribution schemes
10,000
10,440
8
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
16,909
349
Other interest income
1,984
-
Total income
18,893
349
SOFAS & STUFF LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 25 -
9
Interest payable and similar expenses
2023
2022
£
£
Interest on bank overdrafts and loans
14,429
20,466
Other interest on financial liabilities
8,450
32,369
Total finance costs
22,879
52,835
10
Amounts written off investments
2023
2022
£
£
Amounts written off current loans
(52,770)
(245,231)
11
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
217,216
(114)
Adjustments in respect of prior periods
-
0
(77,363)
Total current tax
217,216
(77,477)
Deferred tax
Origination and reversal of timing differences
15,878
469,784
Total tax charge
233,094
392,307

The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:

2023
2022
£
£
Profit before taxation
909,581
1,725,105
Expected tax charge based on the standard rate of corporation tax in the UK of 23.50% (2022: 19.00%)
213,752
327,770
Tax effect of expenses that are not deductible in determining taxable profit
13,811
47,643
Tax effect of utilisation of tax losses not previously recognised
-
0
(2,044)
Unutilised tax losses carried forward
7,378
12,734
Adjustments in respect of financial assets
(3,034)
(3,153)
Deferred tax adjustment
1,187
9,357
Taxation charge
233,094
392,307
SOFAS & STUFF LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 26 -
12
Dividends
2023
2022
Recognised as distributions to equity holders:
£
£
Interim dividend paid of 37.79p oer ordinary share
1,000,000
-
13
Tangible fixed assets
Group
Leasehold improvements
Fixtures and fittings
Computer equipment
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 January 2023
3,905,954
361,845
1,046,315
278,006
5,592,120
Additions
470,973
233,253
92,093
-
0
796,319
At 31 December 2023
4,376,927
595,098
1,138,408
278,006
6,388,439
Depreciation and impairment
At 1 January 2023
702,227
200,032
493,767
89,236
1,485,262
Depreciation charged in the year
406,676
76,068
139,537
69,502
691,783
At 31 December 2023
1,108,903
276,100
633,304
158,738
2,177,045
Carrying amount
At 31 December 2023
3,268,024
318,998
505,104
119,268
4,211,394
At 31 December 2022
3,203,727
161,813
552,548
188,770
4,106,858
Company
Leasehold improvements
Fixtures and fittings
Computer equipment
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 January 2023
3,905,954
353,323
1,041,537
278,006
5,578,820
Additions
470,973
233,253
92,093
-
0
796,319
At 31 December 2023
4,376,927
586,576
1,133,630
278,006
6,375,139
Depreciation and impairment
At 1 January 2023
702,227
193,134
489,275
89,236
1,473,872
Depreciation charged in the year
406,676
75,526
139,394
69,502
691,098
At 31 December 2023
1,108,903
268,660
628,669
158,738
2,164,970
Carrying amount
At 31 December 2023
3,268,024
317,916
504,961
119,268
4,210,169
At 31 December 2022
3,203,727
160,189
552,262
188,770
4,104,948
SOFAS & STUFF LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
13
Tangible fixed assets
(Continued)
- 27 -

The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.

Group
Company
2023
2022
2023
2022
£
£
£
£
Fixtures and fittings
1,453
1,937
1,453
1,937
Motor vehicles
110,498
184,101
110,498
184,101
Computer equipment
62,698
117,016
62,698
117,016
174,649
303,054
174,649
303,054
14
Fixed asset investments
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Investments in subsidiaries
15
-
0
-
0
11,100
11,100
Other investments
52,771
105,541
52,771
105,541
52,771
105,541
63,871
116,641
Movements in fixed asset investments
Group
Other Investments
£
Cost or valuation
At 1 January 2023 and 31 December 2023
350,772
Impairment
At 1 January 2023
245,231
Impairment losses
52,770
At 31 December 2023
298,001
Carrying amount
At 31 December 2023
52,771
At 31 December 2022
105,541
SOFAS & STUFF LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
14
Fixed asset investments
(Continued)
- 28 -
Movements in fixed asset investments
Company
Shares in subsidiaries
Loans
Total
£
£
£
Cost or valuation
At 1 January 2023 and 31 December 2023
11,100
350,772
361,872
Impairment
At 1 January 2023
-
245,231
245,231
Impairment losses
-
52,770
52,770
At 31 December 2023
-
298,001
298,001
Carrying amount
At 31 December 2023
11,100
52,771
63,871
At 31 December 2022
11,100
105,541
116,641
SOFAS & STUFF LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 29 -
15
Subsidiaries

Details of the company's subsidiaries at 31 December 2023 are as follows:

Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Sofa Partners (Gloucestershire) Ltd
The Dairy, Tripp Hill Farm Buildings, Fittleworth, RH20 1ER
Ordinary A & B
100.00
Sofa Partners (Hampshire) Limited
As above
Ordinary B
50.00
Sofa Partners (Hertfordshire) Ltd
As above
Ordinary A & B
100.00
Sofa Partners (Kent) Ltd
As above
Ordinary B
50.00
Sofa Partners (Lancashire) Ltd
As above
Ordinary A & B
100.00
Sofa Partners (Lothian) Ltd
As above
Ordinary A & B
100.00
Sofa Partners (Redbrick) Ltd
As above
Ordinary B
50.00
Sofa Partners (Yorkshire) Ltd
As above
Ordinary B
50.00
Sofa Partners Ltd
As above
Ordinary B
50.00

Sofas & Stuff Limited has given guarantees under section 479C of the Companies Act 2006 ("the Act") in respect of the year ended 31 December 2023 for the above companies, and therefore they are exempt from the requirements of the Act relating to the audit of the individual financial statements by virtue of section 479A of the Companies Act 2006.

16
Stocks
Group
Company
2023
2022
2023
2022
£
£
£
£
Work in progress
563,001
958,308
563,001
958,308
Finished goods and goods for resale
2,125,501
1,924,619
2,125,501
1,924,619
2,688,502
2,882,927
2,688,502
2,882,927
17
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Corporation tax recoverable
146,250
198,982
146,250
198,982
Other debtors
938,542
1,239,805
920,750
1,234,025
Prepayments and accrued income
965,363
899,407
964,659
887,729
2,050,155
2,338,194
2,031,659
2,320,736
SOFAS & STUFF LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 30 -
18
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans and overdrafts
20
69,879
165,940
68,718
165,940
Obligations under finance leases
88,396
117,936
88,396
117,936
Trade creditors
1,896,734
2,646,226
1,891,342
2,638,671
Amounts owed to group undertakings
-
0
-
0
191,211
238,859
Corporation tax payable
217,217
52,618
175,989
-
0
Other taxation and social security
835,399
1,214,237
751,663
1,134,133
Other creditors
2,269,092
3,001,231
2,268,207
2,999,978
Accruals and deferred income
187,559
241,766
175,002
230,838
5,564,276
7,439,954
5,610,528
7,526,355
19
Creditors: amounts falling due after more than one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans and overdrafts
20
-
0
69,445
-
0
69,445
Obligations under finance leases
64,321
149,769
64,321
149,769
64,321
219,214
64,321
219,214
20
Loans and overdrafts
Group
Company
2023
2022
2023
2022
£
£
£
£
Bank loans
68,718
235,385
68,718
235,385
Bank overdrafts
1,161
-
0
-
0
-
0
69,879
235,385
68,718
235,385
Payable within one year
69,879
165,940
68,718
165,940
Payable after one year
-
0
69,445
-
0
69,445

The bank loans are secured by a debenture.

The long term bank loan is supported by the Coronavirus Business Interruption Loan Scheme and repayable by regular instalments with an interest margin of 5%. The final redemption date is May 2024.

SOFAS & STUFF LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 31 -
21
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:

Liabilities
Liabilities
2023
2022
Group
£
£
Accelerated capital allowances
789,154
771,076
Retirement benefit obligations
(11,511)
(9,311)
777,643
761,765
Liabilities
Liabilities
2023
2022
Company
£
£
Accelerated capital allowances
789,154
771,076
Retirement benefit obligations
(11,511)
(9,311)
777,643
761,765
Group
Company
2023
2023
Movements in the year:
£
£
Liability at 1 January 2023
761,765
761,765
Charge to profit or loss
15,878
15,878
Liability at 31 December 2023
777,643
777,643

Deferred tax has been calculated at 25%.

 

22
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
178,096
209,926

A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

The pension contributions unpaid at the end of the year were £48,934 (2022 - £37,244).

SOFAS & STUFF LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 32 -
23
Share capital
Group and company
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of 1p each
2,578,095
2,578,095
25,781
25,781
24
Operating lease commitments
Lessee

At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

Group
Company
2023
2022
2023
2022
£
£
£
£
Within one year
1,835,172
1,223,723
1,835,172
1,223,723
Between two and five years
3,965,035
2,553,329
3,965,035
2,553,329
In over five years
1,612,393
951,454
1,612,393
951,454
7,412,600
4,728,506
7,412,600
4,728,506
25
Directors' transactions

A loan was granted to Mr A J Cussins in the year ended 31 December 2021 for £450,000 and remains outstanding at 31 December 2023. The loan is interest free with no fixed repayment date.

26
Controlling party

In the directors opinion the company is ultimately controlled by its directors by virtue of their shareholding in the company.

SOFAS & STUFF LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 33 -
27
Cash generated from group operations
2023
2022
£
£
Profit for the year after tax
676,487
1,332,798
Adjustments for:
Taxation charged
233,094
392,307
Finance costs
22,879
52,835
Investment income
(18,893)
(349)
Depreciation and impairment of tangible fixed assets
691,783
432,613
Other gains and losses
52,770
245,231
Movements in working capital:
Decrease/(increase) in stocks
194,425
(356,837)
Decrease in debtors
235,307
23,273
Decrease in creditors
(1,914,676)
(620,165)
Cash generated from operations
173,176
1,501,706
28
Analysis of changes in net funds - group
1 January 2023
Cash flows
31 December 2023
£
£
£
Cash at bank and in hand
3,108,276
(2,042,508)
1,065,768
Bank overdrafts
-
0
(1,161)
(1,161)
3,108,276
(2,043,669)
1,064,607
Borrowings excluding overdrafts
(235,385)
166,667
(68,718)
Obligations under finance leases
(267,705)
114,988
(152,717)
2,605,186
(1,762,014)
843,172
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