Registered number: 04936880
LIVE FASHION LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
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LIVE FASHION LIMITED
COMPANY INFORMATION
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Chartered Accountants & Statutory Auditor
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LIVE FASHION LIMITED
CONTENTS
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Independent Auditors' Report
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Statement of Comprehensive Income
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Statement of Financial Position
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Statement of Changes in Equity
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Notes to the Financial Statements
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LIVE FASHION LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 30 JUNE 2023
The director presents her strategic report on the affairs of Live Fashion for the year ended 30 June 2023.
Live Fashion Limited is a fashion wholesale business and has exclusive rights with various contemporary llevel brands to distribute their products within defined territories.
The principal activity of the Company is the wholesaling of these brand’s products to a network of stores across the defined territories. Typically, the Company distributes US brands into UK, Europe and the Middle East.
The director was pleased with the performance for the period, particularly taking into account the political instability in Europe and the continuing recovery of markets after Covid-19.
Sales grew to £16.95m, an increase of 17% from the previous year. This result was generated from penetrating deeper into existing markets (Europe sales saw an increase of 12% from the prior year) as well as breaking into new markets (ROW sales saw an incease of 106% from the prior year). The Company strategy of scaling via agents is gaining traction.
Principal risks and uncertainties
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Consumer confidence
As a wholesale business, servicing the retail industry, our success is to a large extent dependant on consumer confidence and disposition to spend on fashion products.
As a wholesaler of contemporary fashion, we ensure our brand offering is tightly curated. Only working with brands that can deliver high quality products, at competitive prices, with a brand positioning that resonates with our customers.
Currency risk
The Company purchases predominantly in USD. The Company continues to take all reasonable steps to protect its currency position by pricing conservatively on a quarterly basis.
Competitive risk
Live Fashion Limited is a growing company and is well established among its target wholesale customers. The Director is always mindful of ensuring the Company continually offers desirable brands presenting high quality collections to our customers.
With a double focus on maximizing the results of our existing brands the Director maintains an outward look to the market to identify the next rising star.
The Company continues to develop relationships and to strengthen its reputation with the US market as arguably the best-in-class wholesaler within the contemporary space.
The Company has invested in a new ERP system to help streamline its operations.
Fashion risk
Our business revolves around fashion and success is linked to offering collections to our customer base that will resonate with their retail consumers.
Our wholesale customers forward book their orders with us, so largely the risk passes to our customers. We do focus on helping our customers mitigate risk via our experienced sales team analysing all sales prior to sales cut off and communicating anything seen as a risk in advance.
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LIVE FASHION LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
IT Systems
The Company relies on the efficient and uninterrupted operation of our IT Systems and the internet. The Company mitigates these risks by ensuring our IT systems are cloud based with AWS and appropriate back up facility. The Company continues to assess security of our systems and our internal processes to mitigate risk of cybercrime.
Financial key performance indicators
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The Company’s primary financial key performance indicators include gross revenue, gross profit and operating profit.
In addition the Director monitors operational key performances including new customer acquisitions during the year and number of active customers.
During the year our active customers numbers grew by 26%. This growth reflected the effectiveness of our sales agents work in identifying and securing new customers within our markets.
This report was approved by the board and signed on its behalf.
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LIVE FASHION LIMITED
DIRECTOR'S REPORT
FOR THE YEAR ENDED 30 JUNE 2023
The director presents her report and the financial statements for the year ended 30 June 2023.
Director's responsibilities statement
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The director is responsible for preparing the Strategic Report, the Director's Report and the financial statements in accordance with applicable law and regulations.
Company law requires the director to prepare financial statements for each financial year. Under that law the director has elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the director must not approve the financial statements unless she is satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period.
In preparing these financial statements, the director is required to:
∙select suitable accounting policies for the Company's financial statements 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 financial statements;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.
The director is 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 to enable her to ensure that the financial statements comply with the Companies Act 2006. She is 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.
The principal activity of the Company is the wholesaling of these brand’s products to a network of stores across the defined territories. Typically, the Company distributes US brands into UK, Europe and the Middle East.
The profit for the year, after taxation, amounted to £1,023,024 (2022 - £1,181,497).
Dividends totalling £400,000 (2022: £550,000) were paid in the year.
The director who served during the year was:
The Company has continued to grow and intends to continue its current principal activities.
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LIVE FASHION LIMITED
DIRECTOR'S REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
Disclosure of information to auditors
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The director at the time when this Director's Report is approved has confirmed that:
∙so far as she is aware, there is no relevant audit information of which the Company's auditors are unaware, and
∙she has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditors are aware of that information.
Post balance sheet events
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There were no post balance sheet events impacting the business.
Under section 487(2) of the Companies Act 2006, BKL Audit LLP will be deemed to have been reappointed as auditors 28 days after these financial statements were sent to members or 28 days after the latest date prescribed for filing the accounts with the registrar, whichever is earlier.
This report was approved by the board and signed on its behalf.
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LIVE FASHION LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF LIVE FASHION LIMITED
We have audited the financial statements of Live Fashion Limited (the 'Company') for the year ended 30 June 2023, which comprise the Statement of Comprehensive Income, the Statement of Financial Position, the Statement of Cash Flows, the Statement of Changes in Equity and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
∙give a true and fair view of the state of the Company's affairs as at 30 June 2023 and of its profit for the year then ended;
∙have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
∙have been prepared in accordance with the requirements of the Companies Act 2006.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council'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
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In auditing the financial statements, we have concluded that the director's use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the director with respect to going concern are described in the relevant sections of this report.
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LIVE FASHION LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF LIVE FASHION LIMITED (CONTINUED)
The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' Report thereon. The director is 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 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.
Opinion on other matters prescribed by the Companies Act 2006
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In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Strategic Report and the Director's Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
∙the Strategic Report and the Director's Report have been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
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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 Director's Report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
∙adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
∙the financial statements are not in agreement with the accounting records and returns; or
∙certain disclosures of director's 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
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As explained more fully in the Director's Responsibilities Statement set out on page 3, the director is 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 director determines 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 director is 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 director either intends to liquidate the Company or to cease operations, or have no realistic alternative but to do so.
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LIVE FASHION LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF LIVE FASHION LIMITED (CONTINUED)
Auditors' responsibilities for the audit of the financial statements
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Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditors' Report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
∙Enquiring of management around actual and potential litigation and claims;
∙Reviewing financial statement disclosures and testing to supporting documentation with applicable laws and regulations;
∙Performing audit work over the risks of management override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for bias.
Reviewing the general ledger in detail for all transactions with related parties;
Performing walkthrough testing to ensure systems and controls are operating as recorded where
appropriate.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
As part of an audit in accordance with ISAs (UK), we exercise professional judgement 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 of the effectiveness of the Company's internal control.
∙Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the director.
∙Conclude on the appropriateness of the director's 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 Auditors' 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 Auditors' 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
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LIVE FASHION LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF LIVE FASHION LIMITED (CONTINUED)
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.
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.
Myfanwy Neville FCA (Senior Statutory Auditor)
for and on behalf of
BKL Audit LLP
Chartered Accountants
Statutory Auditor
London
25 September 2024
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LIVE FASHION LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2023
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Interest receivable and similar income
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Interest payable and similar expenses
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Profit for the financial year
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There was no other comprehensive income for 2023 (2022:£NIL).
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The notes on pages 13 to 24 form part of these financial statements.
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LIVE FASHION LIMITED
REGISTERED NUMBER: 04936880
STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2023
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Capital redemption reserve
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The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 13 to 24 form part of these financial statements.
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STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2023
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Capital redemption reserve
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Comprehensive income for the year
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Contributions by and distributions to owners
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Dividends: Equity capital
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Comprehensive income for the year
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Contributions by and distributions to owners
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Dividends: Equity capital
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The notes on pages 13 to 24 form part of these financial statements.
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LIVE FASHION LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2023
Cash flows from operating activities
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Profit for the financial year
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Depreciation of tangible assets
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Loss on disposal of tangible assets
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Net cash generated from operating activities
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Cash flows from investing activities
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Purchase of tangible fixed assets
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Purchase of unlisted and other investments
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Net cash from investing activities
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Cash flows from financing activities
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Net cash used in financing activities
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Net increase in cash and cash equivalents
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Cash and cash equivalents at beginning of year
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Cash and cash equivalents at the end of year
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Cash and cash equivalents at the end of year comprise:
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The notes on pages 13 to 24 form part of these financial statements.
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LIVE FASHION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
The principal activity of the Company is that of a clothing wholesale and distributor. The Company operates from their head office in Shoreditch, London with a network of offices and agents that span Europe, the US, Asia Pacific and the Middle East.
The Company is a private company limited by shares and is incorporated in England and Wales.
The registered office is 51-53 Rivington Street, London, EC2A 3QB.
2.Accounting policies
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Basis of preparation of financial statements
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The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the Company's accounting policies.
The following principal accounting policies have been applied:
The Director has assessed whether the Company has adequate resources to meet its obligations as they fall due and beyond the 12 months from the date of the approval of these financial statements. The Director has reviewed their forecasts and cash flow requirements for this period.
The Director is confident that the Company has sufficient working capital available to continue in operational existence for the forseeable future.
The Director believes the going concern basis of accounting is appropriate for these annual financial statements.
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Foreign currency translation
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Functional and presentation currency
The Company's functional and presentational currency is GBP.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
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LIVE FASHION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
2.Accounting policies (continued)
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Foreign currency translation (continued)
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Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Statement of Comprehensive Income except when deferred in other comprehensive income as qualifying cash flow hedges.
Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Statement of Comprehensive Income within 'finance income or costs'. All other foreign exchange gains and losses are presented in the Statement of Comprehensive Income within 'other operating income'.
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.
Revenue is recognised when goods are delivered to the customer, whether sales are fulfilled directly through the Company's own delivery channels, or by trading partners through concession agreements. Revenue is recognised net of a returns provision, based on historical data and trends.
Defined contribution pension plan
The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.
The contributions are recognised as an expense in the Statement of Comprehensive Income when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of Financial Position. The assets of the plan are held separately from the Company in independently administered funds.
Tax is recognised in the Statement of Comprehensive Income except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company operates and generates income.
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LIVE FASHION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
2.Accounting policies (continued)
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the Statement of Comprehensive Income.
Investments in subsidiaries are measured at cost less accumulated impairment.
During the year ended 30 June 2023, the Company made a voluntary change to their accounting policy regarding the basis of cost of stock. This has been changed from the cost being based on the cost of purchase on a weighted average basis to being on a first in, first out basis. The director considered that changing the basis to first in, first out provided a more reliable and relevant reflection of stock valuation in the financial statements.
Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis.
At each reporting date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in the Statement of Comprehensive Income.
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Cash and cash equivalents
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Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.
In the Statement of Cash Flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Company's cash management.
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LIVE FASHION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
2.Accounting policies (continued)
The Company only enters into basic financial instruments transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors.
(i) Financial assets
Basic financial assets, including trade and other debtors, cash and bank balances, are initially recognised at transaction price, 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.
Such assets are subsequently carried at amortised cost using the effective interest method.
At the end of each reporting period financial assets measured at amortised cost are assessed for objective evidence of impairment. 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 the Statement of Comprehensive Income.
If there is 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 the Statement of Comprehensive Income.
Financial assets are derecognised when (a) the contractual rights to the cash flows from the asset expire or are settled, or (b) substantially all the risks and rewards of the ownership of the asset are transferred to another party or (c) despite having retained some significant risks and rewards of ownership, control of the asset has been transferred to another party who has the practical ability to unilaterally sell the asset to an unrelated third party without imposing additional restrictions.
(ii) Financial liabilities
Basic financial liabilities, including trade and other creditors and accruals, 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 receipts discounted at a market rate of interest. 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. Trade creditors 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.
Financial liabilities are derecognised when the liability is extinguished, that is when the contractual obligation is discharged, cancelled or expires.
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LIVE FASHION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
2.Accounting policies (continued)
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Financial instruments (continued)
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(iii) Offsetting
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.
Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting.
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Judgements in applying accounting policies and key sources of estimation uncertainty
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The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported for assets and liabilities as at the balance sheet date and the amounts reported for revenues and expenses during the year. However, the nature of estimation means that actual outcomes could differ from those estimates.
The following judgements have had the most significant effect on amounts recognised in the financial statements.
Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
i) Stock provision
The Company sells clothes that are subject to changing consumer demands and fashion trends. As a result, it is necessary to consider the net realisable value of stock and the associated provision required. When calculating the stock provision, management considers the nature and condition of the stock, as well as applying assumptions around anticipated saleability of the stock. See note 14 for the net carrying amount of the stock.
ii) Debtors
The Company makes an estimate of the recoverable value of trade and other debtors. When assessing impairment of trade and other debtors, management considers factors including the ageing profile of debtors and historical experience. See note 15 for the net carrying amount of the debtors.
iii) Returns provision
The Company sells clothes directly to customers through agents and the internet which are subject to consumer buying trends. As a result, it is necessary to consider a provision for returns made post year end. The potential returns are assessed based on expected consumer buying habits, historical expectations of timing and volume of returns. See note 16 for the returns provision included in other creditors.
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LIVE FASHION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
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The whole turnover is attributable to the sale of clothing to customers.
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Analysis of turnover by country of destination:
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The operating profit is stated after charging:
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Other operating lease rentals
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Depreciation of tangible assets
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Defined contribution pension costs
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LIVE FASHION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
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During the year, the Company obtained the following services from the Company's auditors:
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Fees payable to the Company's auditors for the audit of the Company's financial statements
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Fees payable to the Company's auditors in respect of:
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All non-audit services not included above
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Staff costs, including director's remuneration, were as follows:
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Cost of defined contribution scheme
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The average monthly number of employees, including the director, during the year was as follows:
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The total directors emoluments paid was £68,000 (2022: £156,000).
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LIVE FASHION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
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Current tax on profits for the year
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Factors affecting tax charge for the year
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The tax assessed for the year is lower than (2022 - lower than) the standard rate of corporation tax in the UK of 20.5% (2022 - 19%). The differences are explained below:
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Profit on ordinary activities before tax
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Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 20.5% (2022 - 19%)
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Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
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Capital allowances for year in excess of depreciation
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Adjustments to tax charge in respect of prior periods
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Movement in deferred tax not recognised
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Total tax charge for the year
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Factors that may affect future tax charges
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There were no factors that may affect future tax charges.
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LIVE FASHION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
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Dividends on ordinary shares
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Long-term leasehold property
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Charge for the year on owned assets
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The Company has issued a debenture which has been secured by a fixed and floating charge. The fixed charge is held over book and other debts, chattels, goodwill and uncalled capital, both present and future. The floating charge is over all assets and undertakings both present and future.
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LIVE FASHION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
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Finished goods and goods for resale
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The carrying value of stocks are stated net of impairment losses totalling £609,744 (2022 - £121,945).
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LIVE FASHION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
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Creditors: Amounts falling due within one year
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Other taxation and social security
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Allotted, called up and fully paid
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4 (2022 - 4) Ordinary shares of £1.00 each
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Capital redemption reserve
The capital redemption reserve includes all amounts paid to buy back shares issued in the Company.
Profit and loss account
Includes all current period retained profits and losses.
The bank has a cross-guarantee facility in place, covering the liabilities of this company and a related party company. As at 30 June 2023, the liabilities of the related party company were £1,599,362 (2022: £37,228).
The bank has also agreed to provide a class guarantee facility to certain suppliers, of which only one was in place at the year end totalling £154,521.
The Company operates a Defined Contribution Pension Scheme. The assets of the scheme are held separately from those of the Company in an independently administered fund. The pension contributions payable by the Company to the fund at year end amounted to £2,742 (2022: £2,592). The pension contributions throughout the year amounted to £80,177 (2022: £53,507).
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LIVE FASHION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
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Commitments under operating leases
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At 30 June 2023 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:
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Later than 1 year and not later than 5 years
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Related party transactions
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During the year, the Company paid rent of £168,000 (2022: £134,400) to Sunshine Property Ventures Limited, a Company controlled by C Whiley, a director of the Company. Live Fashion Limited loaned Sunshine Property Ventures Limited £1,835,845 (2022: £1,869,304). The loan was interest free with no fixed date for repayment.
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The ultimate controlling party is C Whiley.
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