Company registration number 00425506 (England and Wales)
MARSYLKA MANUFACTURING CO. LTD
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
MARSYLKA MANUFACTURING CO. LTD
COMPANY INFORMATION
Directors
R J Hainsworth
J S Hainsworth
A E Hainsworth
Secretary
R J Hainsworth
Company number
00425506
Registered office
Unit 4
Thornbury Industrial Park
Woodhall Road
Bradford
BD3 7AF
Auditor
Buckle Barton
Sanderson House
Station Road
Horsforth
LS18 5NT
MARSYLKA MANUFACTURING CO. LTD
CONTENTS
Page
Strategic report
1
Directors' report
2
Directors' responsibilities statement
3
Independent auditor's report
4 - 6
Profit and loss account
7
Group statement of comprehensive income
8
Group balance sheet
9
Company balance sheet
10
Group statement of changes in equity
11
Company statement of changes in equity
12
Group statement of cash flows
13
Notes to the financial statements
14 - 31
MARSYLKA MANUFACTURING CO. LTD
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The directors present the strategic report for the year ended 31 December 2023.
Review of the business
During the year the investment property was transferred to a newly created Marsylka Holdings.
Marsylka supplies clothing -predominantly ladies nightwear-to retailers who vary in size from large retailers to single shops.
Our main production facilities are two wholly owned factories in Sri Lanka but we also source garments from other manufacturers in China and India.
2023 2022
Sales £8,722,064 £10,138,972
GP% 20.70% 26.99%
Sales at Marsylka Manufacturing declined in the year by 13.97% due in part to the uncertain conditions in Sri Lanka and excess stock holding of some customers. Gross margin declined due to increased price competition and the strengthening of the Sri Lanka rupee which increased garment costs.
Administrative costs reduced during the year by £374,495 but this was due to exchange rate losses in Marsylka Sri Lanka on intercompany loans in 2022. If this was excluded costs would be broadly the same.
This led to a loss before tax of £169,527.
Strategy
Our aim for 2024 is to maintain turnover, keep overheads down, improve margin , and reduce stock.
We will do this by focusing on costs, quality, ethics and compliance, and on time deliveries.
Principal risks and uncertainties
The economic situation in Sri lanka remains uncertain leading to fluctuations in the value of the currency.
R J Hainsworth
Director
9 September 2024
MARSYLKA MANUFACTURING CO. LTD
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 and group continued to be that of the manufacture and retail of women's clothing.
Results and dividends
The results for the year are set out on page 7.
Ordinary dividends were paid amounting to £2,825,000. 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:
R J Hainsworth
J S Hainsworth
A E Hainsworth
Disabled persons
Applications for employment by disabled persons are always fully considered, bearing in mind the aptitudes of the applicant concerned. In the event of members of staff becoming disabled, every effort is made to ensure that their employment within the group continues and that the appropriate training is arranged. It is the policy of the group that the training, career development and promotion of disabled persons should, as far as possible, be identical to that of other employees.
Employee involvement
The group's policy is to consult and discuss with employees, through unions, staff councils and at meetings, matters likely to affect employees' interests.
Information about matters of concern to employees is given through information bulletins and reports which seek to achieve a common awareness on the part of all employees of the financial and economic factors affecting the group's performance.
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.
On behalf of the board
R J Hainsworth
Director
9 September 2024
MARSYLKA MANUFACTURING CO. LTD
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 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:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the ;
prepare the on the going concern basis unless it is inappropriate to presume that the group and company will continue in business.
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.
MARSYLKA MANUFACTURING CO. LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF MARSYLKA MANUFACTURING CO. LTD
- 4 -
Opinion
We have audited the financial statements of Marsylka Manufacturing Co. Ltd (the 'parent company') and its subsidiaries (the 'group') 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 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 group's and the parent company's affairs as at 31 December 2023 and of the group's 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 group and parent 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 group's and parent 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.
MARSYLKA MANUFACTURING CO. LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF MARSYLKA MANUFACTURING CO. LTD
- 5 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the group and the parent company and their 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 by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent company financial statements are not in agreement with the accounting records and returns; or
certain disclosures of directors' remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement, 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 parent 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 parent 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.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
- We obtained an understanding of laws and regulations that affect the company, focusing on those that had a direct effect on the financial statements or that had a fundamental effect on its operations. Key laws and regulations that we identified included the UK Companies Act, tax legislation and occupational health and employment legislation.
- We enquired of the directors for evidence of non compliance with relevant laws and regulations. We also reviewed controls the directors have in place to ensure compliance.
- We gained an understanding of the controls that the directors have in place to prevent and detect fraud. We enquired of the directors about any instances of fraud that had taken place during the accounting period.
- The risk of fraud and non-compliance with laws and regulations and fraud was discussed within the audit team and tests were planned and performed to address these risks.
- We reviewed financial statements disclosures and tested to supporting documentation to assess compliance with relevant laws and regulations discussed above.
- We enquired of the directors about actual and potential litigation and claims.
- We performed analytical procedures to identify any unusual or unexpected relationships that might indicate risks of material misstatement due to fraud.
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.
MARSYLKA MANUFACTURING CO. LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF MARSYLKA MANUFACTURING CO. LTD
- 6 -
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.
Mark Dalton BA FCA (Senior Statutory Auditor)
For and on behalf of Buckle Barton
9 September 2024
Chartered Accountants
Statutory Auditor
Sanderson House
Station Road
Horsforth
Leeds
LS18 5NT
MARSYLKA MANUFACTURING CO. LTD
GROUP PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 7 -
2023
2022
Notes
£
£
Turnover
3
8,722,064
10,138,972
Cost of sales
(6,916,645)
(7,402,131)
Gross profit
1,805,419
2,736,841
Administrative expenses
(1,988,527)
(2,363,023)
Other operating income
132,473
107,727
Operating (loss)/profit
4
(50,635)
481,545
Interest payable and similar expenses
8
(118,892)
(107,213)
Fair value gains and losses on investment properties
14
1,806,714
(Loss)/profit before taxation
(169,527)
2,181,046
Tax on (loss)/profit
10
484,674
(548,422)
Profit for the financial year
315,147
1,632,624
Profit for the financial year is all attributable to the owners of the parent company.
MARSYLKA MANUFACTURING CO. LTD
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 8 -
2023
2022
£
£
Profit for the year
315,147
1,632,624
Other comprehensive income
Currency translation (loss)/gain taken to retained earnings
(74,289)
75,764
Total comprehensive income for the year
240,858
1,708,388
Total comprehensive income for the year is all attributable to the owners of the parent company.
MARSYLKA MANUFACTURING CO. LTD
GROUP BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 9 -
2023
2022
Notes
£
£
£
£
Fixed assets
Goodwill
12
75,833
89,833
Other intangible assets
12
3,490
18,386
Total intangible assets
79,323
108,219
Tangible assets
13
551,541
803,719
Investment property
14
4,825,000
630,864
5,736,938
Current assets
Stocks
17
3,502,677
4,375,668
Debtors
18
2,171,579
1,778,293
Cash at bank and in hand
151,699
30,301
5,825,955
6,184,262
Creditors: amounts falling due within one year
19
(948,687)
(3,139,727)
Net current assets
4,877,268
3,044,535
Total assets less current liabilities
5,508,132
8,781,473
Creditors: amounts falling due after more than one year
20
(479,433)
(481,346)
Provisions for liabilities
Provisions
22
90,865
124,178
Deferred tax liability
23
17,887
509,206
(108,752)
(633,384)
Net assets
4,919,947
7,666,743
Capital and reserves
Called up share capital
25
170,190
170,190
Revaluation reserve
162,654
Capital redemption reserve
108,810
108,810
Profit and loss reserves
4,640,947
7,225,089
Total equity
4,919,947
7,666,743
The financial statements were approved by the board of directors and authorised for issue on 9 September 2024 and are signed on its behalf by:
09 September 2024
R J Hainsworth
Director
Company registration number 00425506 (England and Wales)
MARSYLKA MANUFACTURING CO. LTD
COMPANY BALANCE SHEET
AS AT 31 DECEMBER 2023
31 December 2023
- 10 -
2023
2022
Notes
£
£
£
£
Fixed assets
Intangible assets
12
1
1
Tangible assets
13
157,734
198,058
Investment property
14
4,825,000
Investments
15
203,704
204,764
361,439
5,227,823
Current assets
Stocks
17
2,411,687
3,407,012
Debtors
18
3,116,835
2,221,015
Cash at bank and in hand
137,345
5,665,867
5,628,027
Creditors: amounts falling due within one year
19
(628,202)
(2,528,594)
Net current assets
5,037,665
3,099,433
Total assets less current liabilities
5,399,104
8,327,256
Creditors: amounts falling due after more than one year
20
(479,433)
(481,346)
Provisions for liabilities
Deferred tax liability
23
33,577
485,255
(33,577)
(485,255)
Net assets
4,886,094
7,360,655
Capital and reserves
Called up share capital
25
170,190
170,190
Capital redemption reserve
108,810
108,810
Profit and loss reserves
4,607,094
7,081,655
Total equity
4,886,094
7,360,655
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 £350,439, (2022: £1,605,237)
The financial statements were approved by the board of directors and authorised for issue on 9 September 2024 and are signed on its behalf by:
09 September 2024
R J Hainsworth
Director
Company registration number 00425506 (England and Wales)
MARSYLKA MANUFACTURING CO. LTD
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
Share capital
Revaluation reserve
Capital redemption reserve
Profit and loss reserves
Total
Notes
£
£
£
£
£
Balance at 1 January 2022
170,190
86,890
108,810
5,516,701
5,882,591
Year ended 31 December 2022:
Profit and total comprehensive income
-
-
-
1,632,624
1,632,624
Other movements
-
75,764
-
-
75,764
Balance at 31 December 2022
170,190
162,654
108,810
7,225,089
7,666,743
Year ended 31 December 2023:
Profit for the year
-
-
-
315,147
315,147
Other comprehensive income:
Currency translation differences
-
-
-
(74,289)
(74,289)
Total comprehensive income
-
-
-
240,858
240,858
Dividends
11
-
-
-
(2,825,000)
(2,825,000)
Other movements
-
(162,654)
-
-
(162,654)
Balance at 31 December 2023
170,190
108,810
4,640,947
4,919,947
MARSYLKA MANUFACTURING CO. LTD
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
Share capital
Capital redemption reserve
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 January 2022
170,190
108,810
5,476,418
5,755,418
Year ended 31 December 2022:
Profit and total comprehensive income for the year
-
-
1,605,237
1,605,237
Balance at 31 December 2022
170,190
108,810
7,081,655
7,360,655
Year ended 31 December 2023:
Profit and total comprehensive income
-
-
350,439
350,439
Dividends
11
-
-
(2,825,000)
(2,825,000)
Balance at 31 December 2023
170,190
108,810
4,607,094
4,886,094
MARSYLKA MANUFACTURING CO. LTD
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 13 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
27
88,642
799,759
Interest paid
(118,892)
(107,213)
Income taxes paid
(25,405)
(18,375)
Net cash (outflow)/inflow from operating activities
(55,655)
674,171
Investing activities
Purchase of intangible assets
(1,433)
(2,550)
Purchase of tangible fixed assets
(145,274)
(663,595)
Proceeds from disposal of tangible fixed assets
1,941
56,134
Proceeds from disposal of investment property
4,825,000
-
Net cash generated from/(used in) investing activities
4,680,234
(610,011)
Financing activities
Proceeds from borrowings
-
(490,509)
Repayment of borrowings
(1,913)
-
Repayment of bank loans
(1,586,576)
-
Dividends paid to equity shareholders
(2,825,000)
Net cash used in financing activities
(4,413,489)
(490,509)
Net increase/(decrease) in cash and cash equivalents
211,090
(426,349)
Cash and cash equivalents at beginning of year
(120,837)
229,748
Effect of foreign exchange rates
61,446
75,764
Cash and cash equivalents at end of year
151,699
(120,837)
Relating to:
Cash at bank and in hand
151,699
30,301
Bank overdrafts included in creditors payable within one year
-
(151,138)
MARSYLKA MANUFACTURING CO. LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 14 -
1
Accounting policies
Company information
Marsylka Manufacturing Co. Ltd (“the company”) is a private limited company incorporated in the United Kingdom and registered in England and Wales. The registered office is Unit 4, Thornbury Industrial Park, Woodhall Road, Bradford, BD3 7AF.
The group consists of Marsylka Manufacturing Co. Ltd 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, modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value. 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:
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.
1.2
Business combinations
In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.
Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.
MARSYLKA MANUFACTURING CO. LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -
1.3
Basis of consolidation
The consolidated group financial statements consist of the financial statements of the parent company Marsylka Manufacturing Co. Ltd 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.
Entities in which the group holds an interest and which are jointly controlled by the group and one or more other venturers under a contractual arrangement are treated as joint ventures. Entities other than subsidiary undertakings or joint ventures, in which the group has a participating interest and over whose operating and financial policies the group exercises a significant influence, are treated as associates.
Investments in joint ventures and associates are carried in the group balance sheet at cost plus post-acquisition changes in the group’s share of the net assets of the entity, less any impairment in value. The carrying values of investments in joint ventures and associates include acquired goodwill.
If the group’s share of losses in a joint venture or associate equals or exceeds its investment in the joint venture or associate, the group does not recognise further losses unless it has incurred obligations to do so or has made payments on behalf of the joint venture or associate.
Unrealised gains arising from transactions with joint ventures and associates are eliminated to the extent of the group’s interest in the entity.
1.4
Going concern
At the time of approving the financial statements, the directors have a reasonable expectation that the group 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.
1.5
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.
When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.
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.
MARSYLKA MANUFACTURING CO. LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 16 -
1.6
Intangible fixed assets - goodwill
Goodwill represents the excess of the cost of acquisition of a business over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 10 years.
For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.
1.7
Intangible fixed assets other than goodwill
Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.
Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.
Amortisation 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:
Software
25% straight line
Patents & licences
none
Goodwill
up to 10 years
1.8
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
10% straight line
Plant and equipment
15% straight line
Computers
25% straight line
Motor vehicles
25% straight line
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.
1.9
Investment property
Investment property, which is property held to earn rentals and/or for capital appreciation, is initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Subsequently it is measured at fair value at the reporting end date. Changes in fair value are recognised in profit or loss.
MARSYLKA MANUFACTURING CO. LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 17 -
1.10
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.
An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.
Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the group’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method. Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.
Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.
In the parent company financial statements, investments in associates are accounted for at cost less impairment.
Entities in which the group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.
1.11
Impairment of fixed assets
At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible 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.
MARSYLKA MANUFACTURING CO. LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 18 -
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.
1.12
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.
1.13
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.
1.14
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.
MARSYLKA MANUFACTURING CO. LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 19 -
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.
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.
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.
MARSYLKA MANUFACTURING CO. LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 20 -
Derecognition of financial liabilities
Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.
1.15
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.
1.16
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.
1.17
Provisions
Provisions are recognised when the group has a legal or constructive present obligation as a result of a past event, it is probable that the group will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.
MARSYLKA MANUFACTURING CO. LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 21 -
1.18
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.
1.19
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
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.
As stocks are carried at the lower of cost and net realisable value this requires the estimation of the eventual selling price of goods to customers in the future. A high degree of judgement is applied when estimating the impact on the carrying value of stocks of factors such as slow moving items, shrinkage, damage and obsolescence. The quantity, age and condition of stocks are regularly assessed as part of a range of reviews and stock counts undertake throughout the year. Trade debtors are also assessed for recoverability and bad debts are provided for.
3
Turnover
2023
2022
£
£
Turnover analysed by class of business
Sale of goods
8,722,064
10,138,972
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
8,302,322
7,526,144
Overseas
419,742
2,612,828
8,722,064
10,138,972
MARSYLKA MANUFACTURING CO. LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 22 -
4
Operating (loss)/profit
2023
2022
£
£
Operating (loss)/profit for the year is stated after charging/(crediting):
Exchange (gains)/losses
(386,657)
380,123
Depreciation of owned tangible fixed assets
123,294
125,864
Profit on disposal of tangible fixed assets
(941)
(54,813)
Amortisation of intangible assets
15,626
15,381
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
13,000
17,550
For other services
All other non-audit services
300
1,100
6
Employees
The average monthly number of persons (including directors) employed by the group during the year was:
Group
2023
2022
Number
Number
903
999
Their aggregate remuneration comprised:
Group
2023
2022
£
£
Wages and salaries
1,987,674
1,640,070
Social security costs
57,926
170,103
Pension costs
53,284
51,155
2,098,884
1,861,328
MARSYLKA MANUFACTURING CO. LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 23 -
7
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
174,100
155,759
Company pension contributions to defined contribution schemes
42,800
-
216,900
155,759
8
Interest payable and similar expenses
2023
2022
£
£
Interest on bank overdrafts and loans
118,892
87,723
Other interest on financial liabilities
-
19,490
Total finance costs
118,892
107,213
9
Gain on revaluation of land and buildings
2023
2022
£
£
Fair value gains/(losses) on financial instruments
Gain on fair value adjustment to land and buildings
1,806,714
10
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
(32,996)
548,422
Deferred tax
Origination and reversal of timing differences
(451,678)
Total tax (credit)/charge
(484,674)
548,422
MARSYLKA MANUFACTURING CO. LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
10
Taxation
(Continued)
- 24 -
The actual (credit)/charge for the year can be reconciled to the expected (credit)/charge for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
(Loss)/profit before taxation
(169,527)
2,181,046
Expected tax (credit)/charge based on the standard rate of corporation tax in the UK of 25.00% (2022: 19.00%)
(42,382)
414,399
Tax effect of expenses that are not deductible in determining taxable profit
10,700
Gains not taxable
(235)
Change in unrecognised deferred tax assets
(451,678)
Effect of change in corporation tax rate
-
118,578
Group relief
6,243
Permanent capital allowances in excess of depreciation
(5,204)
Depreciation on assets not qualifying for tax allowances
13,806
Amortisation on assets not qualifying for tax allowances
3,499
Effect of overseas tax rates
(19,423)
15,445
Taxation (credit)/charge
(484,674)
548,422
11
Dividends
2023
2022
Recognised as distributions to equity holders:
£
£
Final paid
2,825,000
-
12
Intangible fixed assets
Group
Goodwill
Software
Total
£
£
£
Cost
At 1 January 2023
140,000
86,744
226,744
Additions
1,433
1,433
Exchange adjustments
(44,367)
(44,367)
At 31 December 2023
140,000
43,810
183,810
Amortisation and impairment
At 1 January 2023
50,167
68,358
118,525
Amortisation charged for the year
14,000
1,626
15,626
Exchange adjustments
(29,664)
(29,664)
At 31 December 2023
64,167
40,320
104,487
MARSYLKA MANUFACTURING CO. LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
12
Intangible fixed assets
(Continued)
- 25 -
Carrying amount
At 31 December 2023
75,833
3,490
79,323
At 31 December 2022
89,833
18,386
108,219
Company
Patents & licences
£
Cost
At 1 January 2023 and 31 December 2023
1
Amortisation and impairment
At 1 January 2023 and 31 December 2023
Carrying amount
At 31 December 2023
1
At 31 December 2022
1
13
Tangible fixed assets
Group
Leasehold improvements
Plant and equipment
Computers
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 January 2023
582,855
911,715
236,772
183,557
1,914,899
Additions
64,274
60,655
20,345
145,274
Disposals
(50,840)
(21,686)
(72,526)
Exchange adjustments
(174,778)
(302,465)
3,370
1,630
(472,243)
At 31 December 2023
472,351
669,905
209,647
163,501
1,515,404
Depreciation and impairment
At 1 January 2023
199,822
607,692
203,252
100,414
1,111,180
Depreciation charged in the year
25,066
50,976
19,144
28,108
123,294
Eliminated in respect of disposals
(50,840)
(20,686)
(71,526)
Exchange adjustments
(46,418)
(161,151)
2,694
5,790
(199,085)
At 31 December 2023
178,470
497,517
174,250
113,626
963,863
Carrying amount
At 31 December 2023
293,881
172,388
35,397
49,875
551,541
At 31 December 2022
383,033
304,023
33,520
83,143
803,719
MARSYLKA MANUFACTURING CO. LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
13
Tangible fixed assets
(Continued)
- 26 -
Company
Leasehold improvements
Plant and equipment
Computers
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 January 2023
76,792
145,804
185,173
163,339
571,108
Additions
2,493
13,409
15,902
Disposals
(50,840)
(21,686)
(72,526)
At 31 December 2023
76,792
148,297
147,742
141,653
514,484
Depreciation and impairment
At 1 January 2023
7,703
117,973
162,004
85,370
373,050
Depreciation charged in the year
7,702
5,661
14,769
27,094
55,226
Eliminated in respect of disposals
(50,840)
(20,686)
(71,526)
At 31 December 2023
15,405
123,634
125,933
91,778
356,750
Carrying amount
At 31 December 2023
61,387
24,663
21,809
49,875
157,734
At 31 December 2022
69,089
27,831
23,169
77,969
198,058
14
Investment property
Group
Company
2023
2023
£
£
Fair value
At 1 January 2023
4,825,000
4,825,000
Disposals
(4,825,000)
(4,825,000)
At 31 December 2023
-
-
The fair value of the investment property has been arrived at on the basis of a valuation carried out on 11 January 2023 by Knight Frank, an independent firm of commercial real estate agents. The valuation was made on an open market value basis by reference to market evidence of transaction prices for similar properties. The directors consider this to be the appropriate value to use in the financial statements.
15
Fixed asset investments
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Investments in subsidiaries
16
203,704
204,764
MARSYLKA MANUFACTURING CO. LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
15
Fixed asset investments
(Continued)
- 27 -
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 January 2023
204,764
Disposals
(1,060)
At 31 December 2023
203,704
Carrying amount
At 31 December 2023
203,704
At 31 December 2022
204,764
16
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
Marsylka Manufacturing Lanka (Pvt)
Sri Lanka
Ordinary
100.00
17
Stocks
Group
Company
2023
2022
2023
2022
£
£
£
£
Raw materials and consumables
785,801
190,859
-
-
Work in progress
100,227
517,580
-
-
Finished goods and goods for resale
2,616,649
3,667,229
2,411,687
3,407,012
3,502,677
4,375,668
2,411,687
3,407,012
18
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade debtors
2,001,735
1,515,273
1,706,190
1,398,244
Corporation tax recoverable
2,491
Amounts owed by group undertakings
-
-
1,245,132
688,687
Other debtors
7,614
102,786
5,774
5,774
Prepayments and accrued income
159,739
160,234
159,739
128,310
2,171,579
1,778,293
3,116,835
2,221,015
MARSYLKA MANUFACTURING CO. LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 28 -
19
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans and overdrafts
21
135,007
1,872,721
135,007
1,872,279
Other borrowings
21
75,000
75,000
75,000
75,000
Trade creditors
377,256
518,863
58,362
76,440
Amounts owed to group undertakings
1,000
Corporation tax payable
182
24,558
182
24,558
Other taxation and social security
212,070
301,323
212,070
301,323
Other creditors
1,591
33,032
Accruals and deferred income
147,581
314,230
147,581
177,994
948,687
3,139,727
628,202
2,528,594
20
Creditors: amounts falling due after more than one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Other borrowings
21
479,433
481,346
479,433
481,346
21
Loans and overdrafts
Group
Company
2023
2022
2023
2022
£
£
£
£
Bank loans
135,007
1,721,583
135,007
1,721,141
Bank overdrafts
151,138
151,138
Other loans
554,433
556,346
554,433
556,346
689,440
2,429,067
689,440
2,428,625
Payable within one year
210,007
1,947,721
210,007
1,947,279
Payable after one year
479,433
481,346
479,433
481,346
22
Provisions for liabilities
Group
Company
2023
2022
2023
2022
£
£
£
£
90,865
124,178
-
-
MARSYLKA MANUFACTURING CO. LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
22
Provisions for liabilities
(Continued)
- 29 -
Movements on provisions:
Group
£
At 1 January 2023
141,108
Exchange difference
(50,243)
At 31 December 2023
90,865
23
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
17,887
509,206
Liabilities
Liabilities
2023
2022
Company
£
£
Accelerated capital allowances
33,577
485,255
Group
Company
2023
2023
Movements in the year:
£
£
Liability at 1 January 2023
509,206
485,255
Credit to profit or loss
(32,996)
-
Credit to equity
(8,107)
-
Transfer on disposal
(451,678)
(451,678)
Other
1,462
-
Liability at 31 December 2023
17,887
33,577
The deferred tax liability set out above is expected to reverse within 12 months and relates to accelerated capital allowances that are expected to mature within the same period. The transfer on disposal relates to the investment property disposed of in the year.
MARSYLKA MANUFACTURING CO. LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 30 -
24
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
53,284
51,155
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.
25
Share capital
Group and company
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary of £1 each
170,190
170,190
170,190
170,190
26
Disposals
On 24 October 2023 the group disposed of its 100% holding in Northern Lingerie Limited, which was previously dormant and dissolved on the date of disposal.
27
Cash generated from group operations
2023
2022
£
£
Profit for the year after tax
315,147
1,632,624
Adjustments for:
Taxation (credited)/charged
(484,674)
548,422
Finance costs
118,892
107,213
Gain on disposal of tangible fixed assets
(941)
(54,813)
Fair value gain on investment properties
(1,806,714)
Amortisation and impairment of intangible assets
15,626
15,381
Depreciation and impairment of tangible fixed assets
123,294
125,864
(Decrease)/increase in provisions
(52,763)
13,557
Movements in working capital:
Decrease/(increase) in stocks
872,991
(1,133,239)
(Increase)/decrease in debtors
(390,795)
1,426,516
Decrease in creditors
(428,135)
(6,274)
Decrease in deferred income
-
(68,778)
Cash generated from operations
88,642
799,759
MARSYLKA MANUFACTURING CO. LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 31 -
28
Analysis of changes in net debt - group
1 January 2023
Cash flows
31 December 2023
£
£
£
Cash at bank and in hand
30,301
121,398
151,699
Bank overdrafts
(151,138)
151,138
(120,837)
272,536
151,699
Borrowings excluding overdrafts
(2,277,929)
1,588,489
(689,440)
(2,398,766)
1,861,025
(537,741)
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