Company registration number 02200090 (England and Wales)
BATCHELORS OF RIPON LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
BATCHELORS OF RIPON LIMITED
COMPANY INFORMATION
Directors
Mr A M Denton
Mrs K L Denton
Secretary
Mr A M Denton
Company number
02200090
Registered office
Camp Hill Close
Dallamires Lane
Ripon
HG4 1TT
Auditor
Azets Audit Services Limited
Triune Court
Monks Cross Drive
York
YO32 9GZ
BATCHELORS OF RIPON LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2
Directors' responsibilities statement
3
Independent auditor's report
4 - 6
Profit and loss account
7
Statement of comprehensive income
8
Balance sheet
9
Statement of changes in equity
10
Notes to the financial statements
11 - 23
BATCHELORS OF RIPON LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The directors present the strategic report for the year ended 31 December 2023.
Business review and principal activities
The principal activity of the company is that of a motor vehicle dealerships supplying new and used cars and light commercials, along with servicing, repair, MoT, parts, and accessories. There have been no major changes in the company’s principal activities in the year under review and at the date of this report. Batchelors of Ripon Limited represents Suzuki, Nissan and Mitsubishi. The company saw an increase in revenue to £15,649,334 (2022 - £14,791,835). Our gross profit margin is 10.77% (2022 - 10.12%). The availability of new car product has remained challenging and the business suffered reasonably large Electric Vehicle depreciation in Q4 2023. These two points severely affected both our revenue and profitability. Since the turn of the year (2023 to 2024) we have focused our efforts on Used Cars and Aftersales. We anticipate our revenue will continue to grow. Whilst our GP% will remain stable to improving. Costs have been, and remain a challenge but there does appear to be some settling. We are a family business who continue to have remarkable staff retentions levels. Staff are trained well and we utilise apprenticeship schemes where possible. Customer care remains paramount and we continue to carefully monitor major review platforms. |
Principal risks and uncertainties
The directors actively review and monitor risk which is of course an inherent part of being in business. We assess the business regularly by department, have a tight management mechanism and have daily operating controls. The major strategic, business and operational risks which the company faces are:
Competition from other new car franchises and independent dealers
Desirability of our products
Availability of stock
Manufacturer exposure to currency fluctuations
Availability of trained staff
Attack of our IT systems
Franchise agreements and contracts
Funding and stocking loan availability and rates of interest
The company does not use any financial instruments.
Key performance indicators
The company uses a number of KPI’s to monitor a variety of business aspects these include, monthly management accounts, weekly financial operating controls, customer care surveys, staff reviews, website search data and price checks.
Future developments
Sales and profitability are expected to continue to improve as the vehicle parc and our database continue to grow.
Mr A M Denton
Director
21 September 2024
BATCHELORS OF RIPON LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
The directors present their annual report and financial statements for the year ended 31 December 2023.
Principal activities
The principal activity of the company is that of a motor vehicle dealerships supplying new and used cars and light commercials, along with servicing, parts and accessories. There have been no major changes in the company’s principal activities in the year under review and at the date of this report. The company represents Suzuki. Through hard work and having a dedicated team we have made the most of the year. Our loyal customer base have been very supportive and adaptable. We are a family business where customer care remains paramount and we continue to carefully monitor all review platforms. |
Results and dividends
The results for the year are set out on page 7.
Ordinary dividends were paid amounting to £1,216,000. The directors do not recommend payment of a further dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Mr A M Denton
Mrs K L Denton
Auditor
The auditor, Azets Audit Services Limited, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.
On behalf of the board
Mr A M Denton
Director
21 September 2024
BATCHELORS OF RIPON LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
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 company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
BATCHELORS OF RIPON LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF BATCHELORS OF RIPON LIMITED
- 4 -
Opinion
We have audited the financial statements of Batchelors of Ripon Limited (the 'company') for the year ended 31 December 2023 which comprise the profit and loss account, the statement of comprehensive income, the balance sheet, the statement of changes in equity and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
give a true and fair view of the state of the company's affairs as at 31 December 2023 and of its profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
BATCHELORS OF RIPON LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF BATCHELORS OF RIPON LIMITED
- 5 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
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.
BATCHELORS OF RIPON LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF BATCHELORS OF RIPON LIMITED
- 6 -
Extent to which the audit was considered capable of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above and on the Financial Reporting Council’s website, to detect material misstatements in respect of irregularities, including fraud.
We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework. Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.
In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included:
Enquiry of management and those charged with governance around actual and potential litigation and claims as well as actual, suspected and alleged fraud;
Reviewing minutes of meetings of those charged with governance;
Assessing the extent of compliance with the laws and regulations considered to have a direct material effect on the financial statements or the operations of the company through enquiry and inspection;
Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations;
Performing audit work over the risk of management bias and override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for indicators of potential bias.
Performing audit work over the timing and recognition of revenue and in particular whether it has been recorded in the correct accounting period.
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 of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
This report is made solely to the company's member 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 member those matters we are required to state to the member 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 member, for our audit work, for this report, or for the opinions we have formed.
Martin Davey
Senior Statutory Auditor
For and on behalf of Azets Audit Services Limited
23 September 2024
Chartered Accountants
Statutory Auditor
Triune Court
Monks Cross Drive
York
YO32 9GZ
BATCHELORS OF RIPON LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 7 -
2023
2022
Notes
£
£
Turnover
2
15,649,334
14,791,835
Cost of sales
(13,963,433)
(13,294,843)
Gross profit
1,685,901
1,496,992
Administrative expenses
(1,648,810)
(1,508,513)
Other operating income
117,996
152,530
Operating profit
3
155,087
141,009
Interest receivable and similar income
6
146
238
Interest payable and similar expenses
7
(153,997)
(111,537)
Profit before taxation
1,236
29,710
Tax on profit
8
9,575
(8,282)
Profit for the financial year
10,811
21,428
The profit and loss account has been prepared on the basis that all operations are continuing operations.
BATCHELORS OF RIPON LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 8 -
2023
2022
£
£
Profit for the year
10,811
21,428
Other comprehensive income
Revaluation of tangible fixed assets
200,000
Tax relating to other comprehensive income
184,000
(50,000)
Other comprehensive income for the year
184,000
150,000
Total comprehensive income for the year
194,811
171,428
BATCHELORS OF RIPON LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 9 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
10
302,988
1,751,365
Current assets
Stocks
11
2,187,741
1,933,096
Debtors
12
1,885,067
1,700,589
Cash at bank and in hand
175
13
4,072,983
3,633,698
Creditors: amounts falling due within one year
13
(3,757,189)
(3,013,086)
Net current assets
315,794
620,612
Total assets less current liabilities
618,782
2,371,977
Creditors: amounts falling due after more than one year
14
(89,729)
(446,235)
Provisions for liabilities
Deferred tax liability
17
191,500
-
(191,500)
Net assets
529,053
1,734,242
Capital and reserves
Called up share capital
19
130,468
130,468
Revaluation reserve
927,567
Capital redemption reserve
176,532
176,532
Profit and loss reserves
222,053
499,675
Total equity
529,053
1,734,242
The financial statements were approved by the board of directors and authorised for issue on 21 September 2024 and are signed on its behalf by:
Mr A M Denton
Director
Company Registration No. 02200090
BATCHELORS OF RIPON LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 10 -
Share capital
Revaluation reserve
Capital redemption reserve
Profit and loss reserves
Total
Notes
£
£
£
£
£
Balance at 1 January 2022
130,468
777,567
176,532
625,247
1,709,814
Year ended 31 December 2022:
Profit for the year
-
-
-
21,428
21,428
Other comprehensive income:
Revaluation of tangible fixed assets
-
200,000
-
-
200,000
Tax relating to other comprehensive income
-
(50,000)
-
(50,000)
Total comprehensive income for the year
-
150,000
-
21,428
171,428
Dividends
9
-
-
-
(147,000)
(147,000)
Balance at 31 December 2022
130,468
927,567
176,532
499,675
1,734,242
Year ended 31 December 2023:
Profit for the year
-
-
-
10,811
10,811
Other comprehensive income:
Tax relating to other comprehensive income
-
184,000
-
184,000
Total comprehensive income for the year
-
184,000
-
10,811
194,811
Dividends
9
-
-
-
(1,216,000)
(1,216,000)
Transfers
-
(1,111,567)
-
927,567
(184,000)
Balance at 31 December 2023
130,468
176,532
222,053
529,053
BATCHELORS OF RIPON LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
1
Accounting policies
Company information
Batchelors of Ripon Limited is a private company limited by shares incorporated in England and Wales. The registered office is Camp Hill Close, Dallamires Lane, Ripon, HG4 1TT.
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 £1.
The financial statements have been prepared under the historical cost convention, modified to include the revaluation of freehold properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.
This 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:
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
Section 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The ultimate parent company is Batchelors Motor Group Limited, which is the smallest and largest group into which these financial statements are consolidated. The registered office of Batchelors Motor Group Limited is Camp Hill Close, Dallamires Lane, Ripon, HG4 1TT. The consolidated accounts are filed at companies house.
1.2
Going concern
Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
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.
Sale of motor vehicles, parts and accessories are recognised on the earlier of full payment by, or delivery date to, the customer together with the associate manufacturer vehicle bonus income. Any other manufacturer income in relation to achieving targets is recognised on an accruals basis. Servicing and bodyshop revenue is recognised on the completion of agreed work.
BATCHELORS OF RIPON LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 12 -
1.4
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:
Freehold land and buildings
None provided
Leasehold land and buildings
Straight line over the life of the lease
Plant and equipment
Straight line over 10 years
Fixtures and fittings
Straight line over 7 - 10 years
Computers
Straight line over 3 - 5 years
Motor Vehicles
Straight line over 3 - 5 years
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.5
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
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.
1.6
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.
Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
BATCHELORS OF RIPON LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 13 -
Consignment Stock
Consignment vehicles are regarded as being effectively under the control of the company and are included within stock on the balance sheet as the company has the significant risks and rewards of ownership even though legal title has not yet passed. The corresponding liability is within creditors.
1.7
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.8
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
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.
BATCHELORS OF RIPON LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 14 -
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, 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.
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.9
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.10
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
BATCHELORS OF RIPON LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.11
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.
1.12
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.13
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.
BATCHELORS OF RIPON LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 16 -
2
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
Car sales
14,220,864
13,488,733
Parts and services sales
1,428,470
1,303,102
15,649,334
14,791,835
2023
2022
£
£
Other revenue
Interest income
146
238
All revenue is attributable to the United Kingdom.
3
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Fees payable to the company's auditor for the audit of the company's financial statements
9,100
9,100
Depreciation of owned tangible fixed assets
51,576
40,128
Depreciation of tangible fixed assets held under finance leases
16,996
18,163
Profit on disposal of tangible fixed assets
(13,641)
-
Operating lease charges
83,758
41,300
4
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Sales, garage and administration
38
35
Directors
2
2
Total
40
37
BATCHELORS OF RIPON LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
4
Employees
(Continued)
- 17 -
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
1,100,687
954,209
Social security costs
109,310
102,191
Pension costs
23,955
19,946
1,233,952
1,076,346
5
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
14,844
18,344
6
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
146
238
7
Interest payable and similar expenses
2023
2022
£
£
Interest on bank overdrafts and loans
30,254
33,874
Other interest on financial liabilities
108,691
67,300
Interest on finance leases and hire purchase contracts
15,052
10,363
153,997
111,537
8
Taxation
2023
2022
£
£
Current tax
Adjustments in respect of prior periods
(2,075)
782
Deferred tax
Origination and reversal of timing differences
(7,500)
7,500
Total tax (credit)/charge
(9,575)
8,282
BATCHELORS OF RIPON LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
8
Taxation
(Continued)
- 18 -
The actual (credit)/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
1,236
29,710
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2022: 19.00%)
309
5,645
Adjustments in respect of prior years
782
Group relief
12,189
Other
(9,884)
(10,334)
Taxation (credit)/charge for the year
(9,575)
8,282
In addition to the amount (credited)/charged to the profit and loss account, the following amounts relating to tax have been recognised directly in other comprehensive income:
2023
2022
£
£
Deferred tax arising on:
Revaluation of property
(184,000)
50,000
9
Dividends
2023
2022
£
£
Final paid
1,216,000
147,000
During the year the company's land and buildings net of deferred tax, totalling £1,216,000 were transferred up to the parent company as a dividend in specie.
BATCHELORS OF RIPON LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 19 -
10
Tangible fixed assets
Freehold land and buildings
Leasehold land and buildings
Plant and equipment
Fixtures and fittings
Computers
Motor Vehicles
Total
£
£
£
£
£
£
£
Cost or valuation
At 1 January 2023
1,432,977
57,539
260,575
266,240
80,186
84,414
2,181,931
Additions
10,260
11,722
1,570
3,000
26,552
Disposals
(1,400,000)
(31,820)
(1,431,820)
Transfers
(32,977)
32,977
At 31 December 2023
57,539
303,812
277,962
81,756
55,594
776,663
Depreciation and impairment
At 1 January 2023
9,441
27,163
161,306
136,904
63,157
32,595
430,566
Depreciation charged in the year
1,187
18,357
34,034
5,051
9,943
68,572
Eliminated in respect of disposals
(25,463)
(25,463)
Transfers
(9,441)
9,441
At 31 December 2023
28,350
189,104
170,938
68,208
17,075
473,675
Carrying amount
At 31 December 2023
29,189
114,708
107,024
13,548
38,519
302,988
At 31 December 2022
1,423,536
30,376
99,269
129,336
17,029
51,819
1,751,365
BATCHELORS OF RIPON LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 20 -
The carrying value of land and buildings comprises:
2023
2022
£
£
Freehold
1,373,536
Long leasehold
29,189
30,378
29,189
1,403,914
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
2023
2022
£
£
Plant and equipment
36,062
41,006
Motor Vehicles
23,180
35,232
59,242
76,238
Freehold property is carried at valuation. If freehold property were measured using the cost model, the carrying amounts for the company would have been £23,536 (2022 - £92,176), being cost £32,977 (2022 - £288,052 ) less accumulated depreciation £9,441 (2022 - £195,876 ).
11
Stocks
2023
2022
£
£
Consignment stock
899,238
280,154
Vehicle stock
1,240,396
1,600,063
Parts stock
48,107
52,879
2,187,741
1,933,096
The carrying amount of stocks includes £2,083,850 (2022 - £1,781,097) pledged as security for liabilities.
12
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
46,553
60,192
Amounts owed by group undertakings
1,664,902
1,333,216
Other debtors
148,370
266,188
Prepayments and accrued income
25,242
40,993
1,885,067
1,700,589
BATCHELORS OF RIPON LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 21 -
13
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Bank loans and overdrafts
15
118,431
160,149
Obligations under finance leases
16
65,980
91,173
Other borrowings
15
2,083,850
1,966,759
Trade creditors
256,275
291,698
Amounts owed to group undertakings
840,878
265,559
Taxation and social security
189,185
30,278
Other creditors
87,869
94,927
Accruals and deferred income
114,721
112,543
3,757,189
3,013,086
Bank loans and overdrafts totalling £31,678 (2022: £432,771) are secured over the assets of the company.
Included within other borrowings are vehicle stocking finance liabilities of £2,083,850 (2022: £1,966,759) which are secured over the related company and group assets.
Also included within obligations under finance leases are hire purchase liabilities totalling £65,980 (2022: £91,173 ) which are secured against the assets that they relate to. Of this hire purchase liability, £28,888 (2022: £28,888) is secured against an asset held in Batchelors Motor Group Limited.
14
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Bank loans and overdrafts
15
15,171
366,791
Obligations under finance leases
16
74,558
79,444
89,729
446,235
Bank loans and overdrafts totalling £31,678 (2022: £432,771) are secured over the assets of the company. Included within bank loans and overdrafts is an amount of £nil (2022: £182,908) in respect of liabilities payable or repayable by instalments which fall due for payments after more than five years from the reporting date.
Included within obligations under finance leases are HP liabilities totalling £74,558 (2022: £79,444) which are secured over the related assets. The average term of the HP equates to 5 years. Of this HP liability £45,358 (2022: £45,358) is secured against an asset held in Batchelors Motor Group Limited.
BATCHELORS OF RIPON LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 22 -
15
Loans and overdrafts
2023
2022
£
£
Bank loans
31,678
432,771
Bank overdrafts
101,924
94,169
Other loans
2,083,850
1,966,759
2,217,452
2,493,699
Payable within one year
2,202,281
2,126,908
Payable after one year
15,171
366,791
16
Finance lease obligations
2023
2022
Future minimum lease payments due under finance leases:
£
£
Within one year
65,980
104,127
In two to five years
89,610
80,545
155,590
184,672
Less: future finance charges
(15,052)
(14,055)
140,538
170,617
Finance lease payments represent rentals payable by the company for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 4 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
17
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2023
2022
Balances:
£
£
Accelerated capital allowances
-
18,000
Tax losses
-
(9,000)
Revaluations
-
184,000
Provisions
-
(1,500)
-
191,500
BATCHELORS OF RIPON LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
17
Deferred taxation
(Continued)
- 23 -
2023
Movements in the year:
£
Liability at 1 January 2023
191,500
Credit to profit or loss
(7,500)
Credit to other comprehensive income
(184,000)
Liability at 31 December 2023
-
18
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
23,955
19,946
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
19
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
130,468
130,468
130,468
130,468
The company has one class of ordinary shares which carry voting and dividend rights. Additionally, the company has in issue 1 redeemable preference shares of £1 each, classified as equity. These shares do not carry voting rights.
20
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2023
2022
£
£
Within one year
16,407
23,607
Between two and five years
6,836
23,243
23,243
46,850
21
Ultimate controlling party
The ultimate parent company and controlling party is Batchelors Motor Group Limited. Group financial statements for Batchelors Motor Group Limited are prepared and can be obtained from their registered office at Camp Hill Close, Dallamires Lane, Ripon, HG4 1TT. Batchelors Motor Group Limited is the smallest and largest group into which Batchelors of Ripon Limited is consolidated.
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