33 01/01/2023 31/12/2023 2023-12-31 false false false false true false false false false false true false false true false false false false false false false No description of principal activities is disclosed 2023-01-01 Sage Accounts Production 23.1 - FRS102_2023 xbrli:pure xbrli:shares iso4217:GBP NI607675 2023-01-01 2023-12-31 NI607675 2023-12-31 NI607675 2022-12-31 NI607675 2022-01-01 2022-12-31 NI607675 2022-12-31 NI607675 2021-12-31 NI607675 core:NetGoodwill 2023-01-01 2023-12-31 NI607675 core:LandBuildings core:ShortLeaseholdAssets 2023-01-01 2023-12-31 NI607675 core:PlantMachinery 2023-01-01 2023-12-31 NI607675 core:MotorVehicles 2023-01-01 2023-12-31 NI607675 bus:RegisteredOffice 2023-01-01 2023-12-31 NI607675 bus:OrdinaryShareClass1 2023-01-01 2023-12-31 NI607675 bus:OrdinaryShareClass2 2023-01-01 2023-12-31 NI607675 bus:LeadAgentIfApplicable 2023-01-01 2023-12-31 NI607675 bus:Agent1 2023-01-01 2023-12-31 NI607675 bus:Director1 2023-01-01 2023-12-31 NI607675 bus:Director2 2023-01-01 2023-12-31 NI607675 bus:Director3 2023-01-01 2023-12-31 NI607675 core:NetGoodwill 2023-12-31 NI607675 core:LandBuildings core:ShortLeaseholdAssets 2022-12-31 NI607675 core:PlantMachinery 2022-12-31 NI607675 core:MotorVehicles 2022-12-31 NI607675 core:LandBuildings core:ShortLeaseholdAssets 2023-12-31 NI607675 core:PlantMachinery 2023-12-31 NI607675 core:MotorVehicles 2023-12-31 NI607675 core:DeferredTaxation 2023-01-01 2023-12-31 NI607675 core:WithinOneYear 2023-12-31 NI607675 core:WithinOneYear 2022-12-31 NI607675 core:RetainedEarningsAccumulatedLosses 2022-01-01 2022-12-31 NI607675 core:ShareCapital 2023-01-01 2023-12-31 NI607675 core:RetainedEarningsAccumulatedLosses 2023-01-01 2023-12-31 NI607675 core:AfterOneYear 2023-12-31 NI607675 core:UKTax 2023-01-01 2023-12-31 NI607675 core:UKTax 2022-01-01 2022-12-31 NI607675 bus:AllOrdinaryShares 2023-01-01 2023-12-31 NI607675 bus:AllOrdinaryShares 2022-01-01 2022-12-31 NI607675 core:ShareCapital 2023-12-31 NI607675 core:ShareCapital 2022-12-31 NI607675 core:RetainedEarningsAccumulatedLosses 2023-12-31 NI607675 core:RetainedEarningsAccumulatedLosses 2022-12-31 NI607675 core:ShareCapital 2021-12-31 NI607675 core:RetainedEarningsAccumulatedLosses 2021-12-31 NI607675 core:PreviouslyStatedAmount core:ShareCapital 2023-12-31 NI607675 bus:OrdinaryShareClass1 core:ShareCapital 2023-12-31 NI607675 bus:OrdinaryShareClass1 core:ShareCapital 2022-12-31 NI607675 bus:OrdinaryShareClass2 core:ShareCapital 2023-12-31 NI607675 core:NetGoodwill 2022-12-31 NI607675 core:AcceleratedTaxDepreciationDeferredTax 2023-12-31 NI607675 core:AcceleratedTaxDepreciationDeferredTax 2022-12-31 NI607675 core:LandBuildings core:ShortLeaseholdAssets 2022-12-31 NI607675 core:PlantMachinery 2022-12-31 NI607675 core:MotorVehicles 2022-12-31 NI607675 core:LeasedAssetsHeldAsLessee core:MotorVehicles 2022-12-31 NI607675 core:DeferredTaxation 2022-12-31 NI607675 core:DeferredTaxation 2023-12-31 NI607675 bus:MediumEntities 2023-01-01 2023-12-31 NI607675 bus:Audited 2023-01-01 2023-12-31 NI607675 bus:Medium-sizedCompaniesRegimeForAccounts 2023-01-01 2023-12-31 NI607675 bus:PrivateLimitedCompanyLtd 2023-01-01 2023-12-31 NI607675 bus:FullAccounts 2023-01-01 2023-12-31
Company registration number: NI607675
COWAN BROS. NI LTD
Financial statements
31 December 2023
COWAN BROS. NI LTD
Contents
Directors and other information
Strategic report
Directors report
Independent auditor's report to the members
Statement of comprehensive income
Statement of financial position
Statement of changes in equity
Statement of cash flows
Notes to the financial statements
COWAN BROS. NI LTD
Directors and other information
Directors George Oliver Cowan
David Cowan
Martha Cowan
Company number NI607675
Registered office 2 Carrakeel Drive
Maydown Industrial Estate
Co. Londonderry
BT47 6UQ
Business address 2 Carrakeel Drive
Maydown Industrial Estate
Co. Londonderry
BT47 6UQ
Auditor McDaid McCullough Moore
28/32 Clarendon Street
Londonderry
BT48 7HD
Bankers HSBC
12 - 14 The Diamond
Londonderry
BT48 6HW
Danske Bank
Donegal Square West
Belfast
BT1 6JS
COWAN BROS. NI LTD
Strategic report
Year ended 31 December 2023
Principal activities
The Company's principal activities are that of retailing wholegood plant and machinery and related services.
Review of activities and future developments
The results for the year are set out on the following pages. Due to the straightforward nature of the business the directors are of the opinion that analysis of performance of the company using key performance indicators is not necessary. The directors are satisfied with the performance of the company and expect to increase turnover and profitability in future years. Profit for the year was £842,652 (2022 : £996,275). Net assets at the balance sheet date were £3,728,048 (2022 : £2,960,366).
Principal risks and uncertainties
The principal risks affecting the company are maintaining income and keeping direct and indirect costs at a sustainable level to promote company profitability.
Financial risk management
The company's operations expose it to financial risks that include the effects of stock turnover risk, credit risk, interest rate risk and liquidity risk. The company has in place a risk management programme to monitor its exposure to financial risk. Due to the size of the company, the directors have not delegated responsibility of monitoring financial risk to a sub committee of the board.
The company maintains significant stock levels as part of its operations. Stock control procedures are in place to minimise the risk of stock obsolescence.
The company makes sales in both cash and credit and has in place credit control procedures to minimise the risk of selling by credit.
The company manages liquidity risk by constantly monitoring cash/credit levels and has available adequate banking facilities to absorb unusual cash flow problems.
This report was approved by the board of directors on 12 August 2024 and signed on behalf of the board by:
George Oliver Cowan
Director
COWAN BROS. NI LTD
Directors report
Year ended 31 December 2023
The directors present their report and the financial statements of the company for the year ended 31 December 2023.
Directors
The directors who served the company during the year were as follows:
George Oliver Cowan
David Cowan
Martha Cowan
Dividends
Particulars of recommended dividends are detailed in note 11 to the financial statements.
Directors responsibilities statement
The directors are responsible for preparing the strategic report, directors report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with 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 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 judgments and accounting estimates that are reasonable and prudent; and
- 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.
Auditor
Each of the persons who is a director at the date of approval of this report confirms that:
- so far as they are aware, there is no relevant audit information of which the company's auditor is unaware; and - they have taken all steps that they ought to have taken as a director to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information.
The auditor is deemed to have been re-appointed in accordance with section 487 of the Companies Act 2006.
This report was approved by the board of directors on 12 August 2024 and signed on behalf of the board by:
George Oliver Cowan
Director
COWAN BROS. NI LTD
Independent auditor's report to the members of
COWAN BROS. NI LTD
Year ended 31 December 2023
Opinion
We have audited the financial statements of COWAN BROS. NI LTD (the 'company') for the year ended 31 December 2023 which comprise the statement of comprehensive income, statement of financial position, statement of changes in equity, statement of cash flows and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including 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: - give a true and fair view of the state of the company's affairs as at 31 December 2023 and of its profit for the year then ended; - have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and - have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the 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.
Other Information
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. 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.
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 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 has been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.
We have nothing to report in respect of the following matters where 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 the returns; or
- certain disclosures of directors' remuneration specified by law are not made; or
- we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement, 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. 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 the environment in which it operates, we identified that the principal risk was of non-compliance with laws and regulations related to medium sized companies and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006, corporation tax, vat and payroll tax. Audit procedures performed included the following:- Inspecting correspondence with tax authorities;- Discussions with management including consideration of known or suspected instances of non-compliance with laws and regulations and fraud;- Considering the internal controls in place to mitigate risks of fraud and non- compliance with laws and regulations;- Identifying and testing of transactions and the rationale behiind significant or unusual transactions, in particular journal entries posted with unusual account combinations, postings by unusual users or with unusual descriptions;- Challenging assumptions and judgements made by management in their critical accounting estimates.Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. As part of an audit in accordance with ISAs (UK), we exercise professional judgment and maintain professional scepticism throughout the audit. we also: - 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. 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. - Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the internal control. - Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors. - Conclude on the appropriateness of the directors use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the company to cease to continue as a going concern. - Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
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 auditors report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.
Patrick Moore (Senior Statutory Auditor)
For and on behalf of
McDaid McCullough Moore
Chartered Accountants
28/32 Clarendon Street
Londonderry
BT48 7HD
12 August 2024
COWAN BROS. NI LTD
Statement of comprehensive income
Year ended 31 December 2023
2023 2022
Note £ £
Turnover 4 18,676,735 18,291,529
Cost of sales ( 15,878,199) ( 15,380,516)
_______ _______
Gross profit 2,798,536 2,911,013
Administrative expenses ( 1,735,667) ( 1,764,615)
Other operating income 5 63,755 69,349
_______ _______
Operating profit 6 1,126,624 1,215,747
Interest payable and similar expenses 9 ( 4,574) ( 3,282)
_______ _______
Profit before taxation 1,122,050 1,212,465
Tax on profit 10 ( 279,398) ( 216,190)
_______ _______
Profit for the financial year and total comprehensive income 842,652 996,275
_______ _______
All the activities of the company are from continuing operations.
COWAN BROS. NI LTD
Statement of financial position
31 December 2023
2023 2022
Note £ £ £ £
Fixed assets
Intangible assets 12 - -
Tangible assets 13 475,192 686,893
_______ _______
475,192 686,893
Current assets
Stocks 14 4,677,695 3,430,192
Debtors:
Amounts falling due within one year 15 844,527 545,129
Cash at bank and in hand 958,591 1,182,155
_______ _______
6,480,813 5,157,476
Creditors: amounts falling due
within one year 16 ( 3,058,903) ( 2,772,611)
_______ _______
Net current assets 3,421,910 2,384,865
_______ _______
Total assets less current liabilities 3,897,102 3,071,758
Creditors: amounts falling due
after more than one year 17 ( 82,934) -
Provisions for liabilities 18 ( 86,120) ( 111,392)
_______ _______
Net assets 3,728,048 2,960,366
_______ _______
Capital and reserves
Called up share capital 22 300 100
Profit and loss account 3,727,748 2,960,266
_______ _______
Shareholders funds 3,728,048 2,960,366
_______ _______
These financial statements were approved by the board of directors and authorised for issue on 12 August 2024 , and are signed on behalf of the board by:
George Oliver Cowan
Director
Company registration number: NI607675
COWAN BROS. NI LTD
Statement of changes in equity
Year ended 31 December 2023
Called up share capital Profit and loss account Total
£ £ £
At 1 January 2022 100 1,972,991 1,973,091
Profit for the year 996,275 996,275
_______ _______ _______
Total comprehensive income for the year - 996,275 996,275
Dividends paid and payable ( 9,000) ( 9,000)
_______ _______ _______
Total investments by and distributions to owners - ( 9,000) ( 9,000)
_______ _______ _______
At 31 December 2022 and 1 January 2023 100 2,960,266 2,960,366
Profit for the year 842,652 842,652
_______ _______ _______
Total comprehensive income for the year - 842,652 842,652
Issue of bonus shares 200 - 200
Dividends paid and payable ( 75,170) ( 75,170)
_______ _______ _______
Total investments by and distributions to owners 200 ( 75,170) ( 74,970)
_______ _______ _______
At 31 December 2023 300 3,727,748 3,728,048
_______ _______ _______
COWAN BROS. NI LTD
Statement of cash flows
Year ended 31 December 2023
2023 2022
£ £
Cash flows from operating activities
Profit for the financial year 842,652 996,275
Adjustments for:
Depreciation of tangible assets 215,156 250,600
Government grant income - ( 2,229)
Interest payable and similar expenses 4,574 3,282
Gain/(loss) on disposal of tangible assets ( 17,248) -
Tax on profit 279,398 216,190
Changes in:
Stocks ( 1,247,503) 338,714
Trade and other debtors ( 299,398) 554,759
Trade and other creditors 241,009 ( 685,025)
_______ _______
Cash generated from operations 18,640 1,672,566
Interest paid ( 4,574) ( 3,282)
Tax paid ( 259,200) ( 66,000)
_______ _______
Net cash (used in)/from operating activities ( 245,134) 1,603,284
_______ _______
Cash flows from investing activities
Purchase of tangible assets ( 86,333) ( 106,520)
Proceeds from sale of tangible assets 100,126 -
_______ _______
Net cash from/(used in) investing activities 13,793 ( 106,520)
_______ _______
Cash flows from financing activities
Proceeds from borrowings ( 20,116) 64,262
Government grant income - 2,229
Payment of finance lease liabilities 103,063 ( 42,193)
Equity dividends paid ( 75,170) ( 9,000)
_______ _______
Net cash from financing activities 7,777 15,298
_______ _______
Net increase/(decrease) in cash and cash equivalents ( 223,564) 1,512,062
Cash and cash equivalents at beginning of year 1,182,155 (329,907)
_______ _______
Cash and cash equivalents at end of year 958,591 1,182,155
_______ _______
COWAN BROS. NI LTD
Notes to the financial statements
Year ended 31 December 2023
1. General information
The company is a private company limited by shares, registered in Northern Ireland (Registration No. NI607675 ). The address of the registered office is Cowan Bros. NI Ltd, 2 Carrakeel Drive, Maydown Industrial Estate, Co. Londonderry, BT47 6UQ.
2. Statement of compliance
These financial statements have been prepared in compliance with FRS 102, 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'.
3. Accounting policies
Basis of preparation
The financial statements have been prepared on the historical cost basis.The financial statements are prepared in sterling, which is the functional currency of the entity.
Judgements and key sources of estimation uncertainty
In applying company accounting policies the directors are required to make judgements and estimates on an ongoing basis about the carrying value of assets and liabilities. If revision is required the revision is recognised in that period together with future periods if necessary. The depreciation charge in respect of tangible fixed assets is based on the estimated useful life of each group of assets. Revision of estimated useful life of each grouping will affect the estimates charged in the financial statements.
Turnover
Turnover is measured at the fair value of the consideration received or receivable for goods supplied and services rendered, net of discounts and Value Added Tax.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership have transferred to the buyer (usually on despatch of the goods); the amount of revenue can be measured reliably; it is probable that the associated economic benefits will flow to the entity; and the costs incurred or to be incurred in respect of the transactions can be measured reliably.
Taxation
The taxation expense represents the aggregate amount of current and deferred tax recognised in the reporting period. Tax is recognised in the statement of comprehensive income, except to the extent that it relates to items recognised in other comprehensive income or directly in capital and reserves. In this case, tax is recognised in other comprehensive income or directly in capital and reserves, respectively. Current tax is recognised on taxable profit for the current and past periods. Current tax is measured at the amounts of tax expected to pay or recover using the tax rates and laws that have been enacted or substantively enacted at the reporting date.
Deferred tax is recognised in respect of all timing differences at the reporting date. Unrelieved tax losses and other 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. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date that are expected to apply to the reversal of the timing difference.
Foreign currencies
Foreign currency transactions are initially recorded in the functional currency, by applying the spot exchange rate as at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the exchange rate ruling at the reporting date, with any gains or losses being taken to the profit and loss account.
Amortisation
Amortisation is calculated so as to write off the cost of an asset, less its estimated residual value, over the useful life of that asset as follows:
Goodwill - 25 % straight line
If there is an indication that there has been a significant change in amortisation rate, useful life or residual value of an intangible asset, the amortisation is revised prospectively to reflect the new estimates.
Tangible assets
Tangible assets are initially recorded at cost, and are subsequently stated at cost less any accumulated depreciation and impairment losses.
Depreciation
Depreciation is calculated so as to write off the cost or valuation of an asset, less its residual value, over the useful economic life of that asset as follows:
Short leasehold property - 10 % straight line
Plant and machinery - 20 % straight line
Motor vehicles - 25 % straight line
If there is an indication that there has been a significant change in depreciation rate, useful life or residual value of tangible assets, the depreciation is revised prospectively to reflect the new estimates.
Impairment
A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date.When it is not possible to estimate the recoverable amount of an individual asset, an estimate is made of the recoverable amount of the cash-generating unit to which the asset belongs. The cash-generating unit is the smallest identifiable group of assets that includes the asset and generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets.For impairment testing of goodwill, the goodwill acquired in a business combination is, from the acquisition date, allocated to each of the cash-generating units that are expected to benefit from the synergies of the combination, irrespective of whether other assets or liabilities of the company are assigned to those units.
Stocks
Stocks are measured at the lower of cost and estimated selling price less costs to complete and sell on a first in first out basis. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing the stocks to their present location and condition. Provision is made for damaged, obsolete and slow moving stock whre appropriate.
Hire purchase and finance leases
Assets held under finance leases are recognised in the statement of financial position as assets and liabilities at the lower of the fair value of the assets and the present value of the minimum lease payments, which is determined at the inception of the lease term. Any initial direct costs of the lease are added to the amount recognised as an asset. Lease payments are apportioned between the finance charges and reduction of the outstanding lease liability using the effective interest method. Finance charges are allocated to each period so as to produce a constant rate of interest on the remaining balance of the liability.
Government grants
Government grants are recognised at the fair value of the asset received or receivable. Grants are not recognised until there is reasonable assurance that the company will comply with the conditions attaching to them and the grants will be received.Government grants are recognised using the accrual model.Grants relating to assets are recognised in income on a systematic basis over the expected useful life of the asset.Where part of a grant relating to an asset is deferred, it is recognised as deferred income and not deducted from the carrying amount of the asset.
Provisions
Provisions are recognised when the entity has an obligation at the reporting date as a result of a past event; it is probable that the entity will be required to transfer economic benefits in settlement and the amount of the obligation can be estimated reliably. Provisions are recognised as a liability in the statement of financial position and the amount of the provision as an expense.
Financial instruments
A financial asset or a financial liability is recognised only when the company becomes a party to the contractual provisions of the instrument.
Defined contribution plans
Contributions to defined contribution plans are recognised as an expense in the period in which the related service is provided. Prepaid contributions are recognised as an asset to the extent that the prepayment will lead to a reduction in future payments or a cash refund. When contributions are not expected to be settled wholly within 12 months of the end of the reporting date in which the employees render the related service, the liability is measured on a discounted present value basis. The unwinding of the discount is recognised in finance costs in profit or loss in the period in which it arises.
4. Turnover
Turnover arises from:
2023 2022
£ £
Sale of goods 18,642,560 18,229,328
Commissions 34,175 62,201
_______ _______
18,676,735 18,291,529
_______ _______
The whole of the turnover is attributable to the principal activity of the company wholly undertaken in the United Kingdom.
5. Other operating income
2023 2022
£ £
Rental income 63,180 51,410
Government grant income - 2,229
Other operating income 575 15,710
_______ _______
63,755 69,349
_______ _______
6. Operating profit
Operating profit is stated after charging/(crediting):
2023 2022
£ £
Depreciation of tangible assets 215,156 250,600
(Gain)/loss on disposal of tangible assets ( 17,248) -
Impairment of trade debtors 3,139 21,640
Foreign exchange differences 1,275 4,534
Fees payable for the audit of the financial statements 9,000 8,000
_______ _______
7. Staff costs
The average number of persons employed by the company during the year, including the directors, amounted to:
2023 2022
Selling / Workshop staff 28 28
Administrative staff 5 5
_______ _______
33 33
_______ _______
The aggregate payroll costs incurred during the year were:
2023 2022
£ £
Wages and salaries 1,018,350 993,094
Social security costs 96,842 94,705
Other pension costs 13,588 16,595
_______ _______
1,128,780 1,104,394
_______ _______
8. Directors remuneration
The directors aggregate remuneration in respect of qualifying services was:
2023 2022
£ £
Remuneration 36,000 36,000
_______ _______
9. Interest payable and similar expenses
2023 2022
£ £
Bank loans and overdrafts 3,351 1,209
Other loans made to the company:
Finance leases and hire purchase contracts 1,223 2,073
_______ _______
4,574 3,282
_______ _______
10. Tax on profit
Major components of tax expense
2023 2022
£ £
Current tax:
UK current tax expense 302,127 257,890
Adjustments in respect of previous periods 2,543 -
_______ _______
Deferred tax:
Origination and reversal of timing differences ( 25,272) ( 41,700)
_______ _______
Tax on profit 279,398 216,190
_______ _______
Reconciliation of tax expense
The tax assessed on the profit for the year is higher than (2022: lower than) the standard rate of corporation tax in the UK of 23.50 % (2022: 19.00%).
2023 2022
£ £
Profit before taxation 1,122,050 1,212,465
_______ _______
Profit multiplied by rate of tax 263,682 230,368
Adjustments in respect of prior periods 2,543 -
Effect of expenses not deductible for tax purposes 235 570
Effect of capital allowances and depreciation 12,938 ( 14,748)
_______ _______
Tax on profit 279,398 216,190
_______ _______
11. Dividends
Equity dividends
2023 2022
£ £
Dividends paid during the year (excluding those for which a liability existed at the end of the prior year) 75,170 9,000
_______ _______
12. Intangible assets
Goodwill Total
£ £
Cost
At 1 January 2023 and 31 December 2023 820,000 820,000
_______ _______
Amortisation
At 1 January 2023 and 31 December 2023 820,000 820,000
_______ _______
Carrying amount
At 31 December 2023 - -
_______ _______
At 31 December 2022 - -
_______ _______
13. Tangible assets
Short leasehold property Plant and machinery Motor vehicles Total
£ £ £ £
Cost
At 1 January 2023 167,153 604,034 646,046 1,417,233
Additions - - 86,333 86,333
Disposals - - ( 284,692) ( 284,692)
_______ _______ _______ _______
At 31 December 2023 167,153 604,034 447,687 1,218,874
_______ _______ _______ _______
Depreciation
At 1 January 2023 16,660 241,139 472,541 730,340
Charge for the year 8,330 115,968 90,858 215,156
Disposals - - ( 201,814) ( 201,814)
_______ _______ _______ _______
At 31 December 2023 24,990 357,107 361,585 743,682
_______ _______ _______ _______
Carrying amount
At 31 December 2023 142,163 246,927 86,102 475,192
_______ _______ _______ _______
At 31 December 2022 150,493 362,895 173,505 686,893
_______ _______ _______ _______
Obligations under finance leases
Included within the carrying value of tangible assets are the following amounts relating to assets held under finance leases or hire purchase agreements:
Motor vehicles
£
At 31 December 2023 -
_______
At 31 December 2022 61,715
_______
14. Stocks
2023 2022
£ £
Stocks for resale 4,677,695 3,430,192
_______ _______
15. Debtors
Debtors falling due within one year are as follows:
2023 2022
£ £
Trade debtors 782,700 465,275
Prepayments and accrued income 11,324 10,999
Other debtors 50,503 68,855
_______ _______
844,527 545,129
_______ _______
16. Creditors: amounts falling due within one year
2023 2022
£ £
Trade creditors 2,144,384 1,946,192
Corporation tax 302,861 257,391
Social security and other taxes 157,923 200,562
Obligations under finance leases 115,289 95,160
Director loan accounts 43,946 64,262
Other creditors 294,500 209,044
_______ _______
3,058,903 2,772,611
_______ _______
Bank borrowings are secured by: A fixed and floating charge over all company assets
The directors account is unsecured and interest free.
17. Creditors: amounts falling due after more than one year
2023 2022
£ £
Obligations under finance leases 82,934 -
_______ _______
18. Provisions
Deferred tax (note 19) Total
£ £
At 1 January 2023 111,392 111,392
Additions ( 25,272) ( 25,272)
_______ _______
At 31 December 2023 86,120 86,120
_______ _______
19. Deferred tax
The deferred tax included in the statement of financial position is as follows:
2023 2022
£ £
Included in provisions (note 18) 86,120 111,392
_______ _______
The deferred tax account consists of the tax effect of timing differences in respect of:
2023 2022
£ £
Accelerated capital allowances 86,120 111,392
_______ _______
20. Employee benefits
The amount recognised in profit or loss in relation to defined contribution plans was £ 13,588 (2022: £ 16,595 ).
21. Government grants
The amounts recognised in the financial statements for government grants are as follows:
2023 2022
£ £
Recognised in other operating income:
Government grants released to profit or loss - 2,229
_______ _______
22. Called up share capital
Issued and called up
2023 2022
No £ No £
Ordinary shares of £ 1.00 each 100 100 100 100
Non participating ordinary shares of £ 1.00 each 200 200 - -
_______ _______ _______ _______
300 300 100 100
_______ _______ _______ _______
23. Analysis of changes in net debt
At 1 January 2023 Cash flows At 31 December 2023
£ £ £
Cash and cash equivalents 1,182,155 (223,564) 958,591
Debt due within one year (159,422) 187 (159,235)
Debt due after one year - (82,934) (82,934)
_______ _______ _______
1,022,733 ( 306,311) 716,422
_______ _______ _______
24. Controlling party
George Oliver Cowan , director & major shareholder, is considered to be the Company's controlling interest.