Company registration number 06991936 (England and Wales)
GARFORD FARM MACHINERY LTD
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
GARFORD FARM MACHINERY LTD
COMPANY INFORMATION
Directors
R Zurn
J C A Henry
Company number
06991936
Registered office
36 Tyndall Court
Commerce Road
Lynch Wood
Peterborough
PE2 6LR
Auditor
Price Bailey LLP
36 Tyndall Court
Commerce Road
Lynchwood
Peterborough
PE2 6LR
Business address
Hards Lane
Frognall
Deeping St James
PE6 8RR
GARFORD FARM MACHINERY LTD
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Independent auditor's report
4 - 6
Statement of income and retained earnings
7
Balance sheet
8
Notes to the financial statements
9 - 20
GARFORD FARM MACHINERY 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
The loss before tax for the period was £70,933 compared to a profit before tax of £730,059 for the year ended 31 December 2022.
Net assets as at period end have decreased to £4,845,678 from £4,858,728 in 2022.
During the year we have experienced lower demand for our products which has resulted in a reduction in revenue and subsequent margin to the business, we have also experienced cost increases from suppliers on the back of energy cost spikes and post covid supply chain issues, although this levelled out in the second half of the fiscal year.
Principal risks and uncertainties
Key market segments that Garford Farm Machinery Ltd serve have been investing less due to lower farm margins on the back of higher input costs and lower farm gate prices. Furthermore Garford Farm Machinery Ltd will continue to monitor the implications of changes in agricultural subsidy payments on future farm income, farm income is considered one of the main drivers in determining the size of the agricultural machinery market.
Development and performance
Garford Farm Machinery Ltd continues to monitor the impact of policy and regulatory changes on the use of herbicides, changes here are expected to increase the mid to long term size of the markets that Garford participate in. In early 2024 the business implemented a restructure to match the cost base of the business to the soft market conditions.
Key performance indicators
Turnover, gross profit and (loss)/profit before tax have all reduced for 2023 compared to 2022.
J C A Henry
Director
20 September 2024
GARFORD FARM MACHINERY 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 continued to be that of manufacturing and retail of agricultural machinery.
Results and dividends
The results for the year are set out on page 7.
No ordinary dividends were paid. The directors do not recommend payment of a final 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 Zurn
J C A Henry
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.
Medium-sized companies exemption
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
GARFORD FARM MACHINERY LTD
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
On behalf of the board
J C A Henry
Director
20 September 2024
GARFORD FARM MACHINERY LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF GARFORD FARM MACHINERY LTD
- 4 -
Opinion
We have audited the financial statements of Garford Farm Machinery Ltd (the 'company') for the year ended 31 December 2023 which comprise the statement of income and retained earnings, the balance sheet and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
give a true and fair view of the state of the company's affairs as at 31 December 2023 and of its loss for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
GARFORD FARM MACHINERY LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF GARFORD FARM MACHINERY LTD
- 5 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
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.
- in addressing the risk of fraud through management override of controls, we have tested the appropriateness of journal entries and other adjustments and we assessed whether judgements made in accounting estimates are indicative of management bias.
- we have evaluated the rationale of any significant transactions that are unusual or outside the normal course of business;
- analytical procedures are performed as well as substantive testing to identify any potential misstatement due to fraud and the audit procedures would also involve being aware of any items from discussions with staff and management.
- health and safety is considered to be a significant law and regulation. Health and safety reports and related documentation were reviewed and discussions were held with management to obtain an understanding of the procedures in place.
GARFORD FARM MACHINERY LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF GARFORD FARM MACHINERY LTD
- 6 -
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.
The primary responsibility for the prevention and detection of irregularities including fraud remains with those charged with governance and with management.
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.
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.
Kerry Hilliard ACA FCCA CTA
Senior Statutory Auditor
For and on behalf of Price Bailey LLP
20 September 2024
2024-09-20
Chartered Accountants
Statutory Auditor
36 Tyndall Court
Commerce Road
Lynchwood
Peterborough
PE2 6LR
GARFORD FARM MACHINERY LTD
STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 7 -
2023
2022
Notes
£
£
Turnover
3
7,982,884
10,064,112
Cost of sales
(6,233,473)
(7,555,714)
Gross profit
1,749,411
2,508,398
Administrative expenses
(1,800,428)
(1,785,230)
Operating (loss)/profit
4
(51,017)
723,168
Interest receivable and similar income
7
13,672
Interest payable and similar expenses
8
(19,916)
(6,781)
(Loss)/profit before taxation
(70,933)
730,059
Tax on (loss)/profit
9
57,883
(106,488)
(Loss)/profit for the financial year
(13,050)
623,571
Retained earnings brought forward
4,857,728
4,234,157
Retained earnings carried forward
4,844,678
4,857,728
The profit and loss account has been prepared on the basis that all operations are continuing operations.
GARFORD FARM MACHINERY LTD
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 8 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
11
785,592
851,816
Current assets
Stocks
12
3,740,410
4,302,379
Debtors
13
1,647,309
1,730,062
Cash at bank and in hand
158,912
40,970
5,546,631
6,073,411
Creditors: amounts falling due within one year
14
(1,185,532)
(1,725,204)
Net current assets
4,361,099
4,348,207
Total assets less current liabilities
5,146,691
5,200,023
Creditors: amounts falling due after more than one year
15
(242,000)
(270,000)
Provisions for liabilities
Deferred tax liability
17
59,013
71,295
(59,013)
(71,295)
Net assets
4,845,678
4,858,728
Capital and reserves
Called up share capital
19
1,000
1,000
Profit and loss reserves
4,844,678
4,857,728
Total equity
4,845,678
4,858,728
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.
The financial statements were approved by the board of directors and authorised for issue on 20 September 2024 and are signed on its behalf by:
J C A Henry
Director
Company registration number 06991936 (England and Wales)
GARFORD FARM MACHINERY LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
1
Accounting policies
Company information
Garford Farm Machinery Ltd is a private company limited by shares incorporated in England and Wales. The registered office is 36 Tyndall Court, Commerce Road, Lynch Wood, Peterborough, PE2 6LR.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues: Interest income/expense and net gains/losses for financial instruments not measured at fair value; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;
Section 26 ‘Share based Payment’: Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements;
Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.
The financial statements of the company are consolidated in the financial statements of Zurn Garford LLP.
1.2
Going concern
Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
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.
Where the contract has yet to commence the deposits received are shown as payments on account.
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.
GARFORD FARM MACHINERY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 10 -
1.4
Research and development expenditure
Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.
1.5
Intangible fixed assets - goodwill
Goodwill represents the excess of the cost of acquisition of unincorporated businesses 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.
1.6
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Freehold buildings
2% on cost
Plant and machinery
20% per annum on net book value
Office fixtures, fittings & equipment
15% per annum on net book value/10% on cost
Motor vehicles
25% per annum on net book value
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.7
Impairment of fixed assets
At each reporting period end date, the company 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).
1.8
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.
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.
GARFORD FARM MACHINERY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 11 -
1.9
Cash and cash equivalents
Cash at bank and in hand are basic financial assets and include cash in hand, deposits held at call with banks and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.10
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Basic financial assets
Debtors and creditors with no stated interest rate and receivable or payable within one year are recorded at transaction price. Any losses arising from impairment are recognised in the profit and loss account in other administrative expenses.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
Impairment of financial assets
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
GARFORD FARM MACHINERY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 12 -
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.11
Equity instruments
Equity instruments being the share capital issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.12
Derivatives
Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently remeasured to fair value at each reporting end date. The resulting gain or loss is recognised in profit or loss immediately unless the derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on the nature of the hedge relationship.
A derivative with a positive fair value is recognised as a financial asset, whereas a derivative with a negative fair value is recognised as a financial liability.
1.13
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 company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
GARFORD FARM MACHINERY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 13 -
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.14
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.
1.15
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.16
Leases
Rentals payable under operating leases, including any lease incentives received, are charged to income on a straight line basis over the term of the relevant lease.
1.17
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
2
Judgements and key sources of estimation uncertainty
In the application of the company’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.
GARFORD FARM MACHINERY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 14 -
3
Turnover and other revenue
An analysis of the company's turnover is as follows:
2023
2022
£
£
Turnover analysed by geographical market
UK
842,493
1,134,407
Europe
6,026,681
7,600,387
Rest of world
1,113,710
1,329,318
7,982,884
10,064,112
2023
2022
£
£
Other revenue
Interest income
-
13,672
4
Operating (loss)/profit
2023
2022
Operating (loss)/profit for the year is stated after charging:
£
£
Exchange differences apart from those arising on financial instruments measured at fair value through profit or loss
87,399
124,263
Research and development costs
99,976
51,958
Fees payable to the company's auditor for the audit of the company's financial statements
8,000
8,000
Fees payable to the company's auditor for non-audit services
6,950
6,950
Depreciation of owned tangible fixed assets
73,395
111,380
(Profit)/loss on disposal of tangible fixed assets
-
2,443
Operating lease charges
165,253
192,011
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
60
62
GARFORD FARM MACHINERY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
5
Employees
(Continued)
- 15 -
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
2,174,764
2,272,323
Social security costs
227,828
254,330
Pension costs
47,541
49,646
2,450,133
2,576,299
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
113,010
198,170
Company pension contributions to defined contribution schemes
1,321
1,101
114,331
199,271
7
Interest receivable and similar income
2023
2022
£
£
Interest income
Other interest income
13,672
8
Interest payable and similar expenses
2023
2022
£
£
Interest on bank overdrafts and loans
19,916
6,781
9
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
87,668
Adjustments in respect of prior periods
(45,601)
Total current tax
(45,601)
87,668
Deferred tax
Origination and reversal of timing differences
(12,282)
18,820
Total tax (credit)/charge
(57,883)
106,488
GARFORD FARM MACHINERY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
9
Taxation
(Continued)
- 16 -
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
(70,933)
730,059
Expected tax (credit)/charge based on the standard rate of corporation tax in the UK of 19.00% (2022: 19.00%)
(13,477)
138,711
Tax effect of expenses that are not deductible in determining taxable profit
121
524
Depreciation on assets not qualifying for tax allowances
13,945
21,162
Research and development tax credit
(44,828)
(55,713)
Deferred tax adjustments in respect of prior years
(12,282)
18,820
Profit on sale of fixed assets
464
Capital allowances
(1,362)
(17,480)
Taxation (credit)/charge for the year
(57,883)
106,488
10
Intangible fixed assets
Goodwill
£
Cost
At 1 January 2023 and 31 December 2023
737,377
Amortisation and impairment
At 1 January 2023 and 31 December 2023
737,377
Carrying amount
At 31 December 2023
At 31 December 2022
GARFORD FARM MACHINERY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 17 -
11
Tangible fixed assets
Freehold buildings
Plant and machinery
Office fixtures, fittings & equipment
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 January 2023
545,865
198,734
323,439
210,387
1,278,425
Additions
7,172
7,172
At 31 December 2023
545,865
205,906
323,439
210,387
1,285,597
Depreciation and impairment
At 1 January 2023
21,095
108,037
144,411
153,067
426,610
Depreciation charged in the year
10,495
19,532
28,646
14,722
73,395
At 31 December 2023
31,590
127,569
173,057
167,789
500,005
Carrying amount
At 31 December 2023
514,275
78,337
150,382
42,598
785,592
At 31 December 2022
524,770
90,697
179,029
57,320
851,816
The carrying value of land and buildings comprises:
2023
2022
£
£
Freehold
514,275
524,770
12
Stocks
2023
2022
£
£
Work in progress
836,956
573,141
Finished goods and goods for resale
2,903,454
3,729,238
3,740,410
4,302,379
GARFORD FARM MACHINERY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 18 -
13
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
133,204
133,012
Corporation tax recoverable
45,601
Amounts owed by group undertakings
1,196,187
1,260,596
Other debtors
141,601
298,077
Prepayments and accrued income
130,716
38,377
1,647,309
1,730,062
14
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Bank loans and overdrafts
16
387,325
277,200
Payments received on account
347,950
587,485
Trade creditors
320,293
500,820
Corporation tax
87,638
Other taxation and social security
66,922
94,633
Other creditors
9,736
Accruals and deferred income
63,042
167,692
1,185,532
1,725,204
Santander UK PLC hold a fixed charge over the property at Spitfire Business Park, Market Deeping, Lincolnshire, PE6 8GY together with a floating charge over all property or undertakings of the company. The value of secured liabilities at 31 December 2023 was £393,094 (2022 : £277,200).
15
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Bank loans and overdrafts
16
242,000
270,000
Santander UK PLC hold a fixed charge over the property at Spitfire Business Park, Market Deeping, Lincolnshire, PE6 8GY together with a floating charge over all property or undertakings of the company. The value of secured liabilities at 31 December 2023 was £242,000 (2022 : £270,000).
GARFORD FARM MACHINERY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 19 -
16
Loans and overdrafts
2023
2022
£
£
Bank loans
270,000
298,000
Bank overdrafts
359,325
249,200
629,325
547,200
Payable within one year
387,325
277,200
Payable after one year
242,000
270,000
17
Deferred taxation
Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:
Liabilities
Liabilities
2023
2022
Balances:
£
£
Accelerated capital allowances
59,013
71,295
18
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
47,541
49,646
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
19
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
1,000
1,000
1,000
1,000
GARFORD FARM MACHINERY LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 20 -
20
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2023
2022
£
£
Within one year
109,739
156,780
Between two and five years
9,439
119,178
119,178
275,958
21
Ultimate controlling party
The parent of Garford Farm Machinery Ltd is Zurn Garford LLP, a wholly owned subsidiary of Zürn Harvesting GmbH & Co. Kg.
The ultimate controlling party is Zürn Harvesting GmbH & Co. Kg. incorporated in Germany. Zürn Harvesting GmbH & Co. Kg. is controlled by Mr R Zürn.
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