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COMPANY REGISTRATION NUMBER: 02874305
The Change Organisation Limited
Financial Statements
31 March 2024
The Change Organisation Limited
Financial Statements
Year ended 31 March 2024
Contents
Pages
Officers and professional advisers
1
Strategic report
2 to 3
Directors' report
4 to 5
Independent auditor's report to the members
6 to 9
Statement of income and retained earnings
10
Statement of financial position
11
Statement of cash flows
12
Notes to the financial statements
13 to 21
The Change Organisation Limited
Officers and Professional Advisers
The board of directors
G H Q Burns
J M J Hogben
T M R Scholfield
K L Gates
P D Quinney
C H Burns
Company secretary
T M R Scholfield
Registered office
Camburgh House
27 New Dover Road
Canterbury
Kent
CT1 3DN
Auditor
Burgess Hodgson LLP
Chartered accountants & statutory auditor
Camburgh House
27 New Dover Road
Canterbury
Kent
CT1 3DN
Bankers
Barclays Bank PLC
Leicester
Leicestershire
United Kingdom
LE87 2BB
The Change Organisation Limited
Strategic Report
Year ended 31 March 2024
Overview and Strategy Founded in 1993, The Change Organisation enjoys an enviable reputation as a pioneering and market leading specialist distributor of computer hardware, software and associated services, delivering bespoke business solutions to its clients both within the UK and internationally. Our strategy is to focus on enhancing profitability of the business through offering a diverse range of fresh exciting "in-demand" products to complement our traditional business IT portfolio, improved internal efficiencies, supply chain refinements and cost reductions whilst simultaneously delivering exceptional value to our customers. REVIEW OF THE YEAR The directors can announce the overall profit before tax for the year of £1,118,068 (2023: £1,318,937). Summary of key performance indicators
2024 2023
£ £
Turnover 64,770,329 74,525,622
Gross profit 7,243,478 7,793,210
Profit before tax 1,118,068 1,318,937
The company's balance sheet at the year end shows shareholders funds of £5,516,841 (2023: £4,668,999) and demonstrates the directors' intentions to continue to retain significant working capital within the business to support the ongoing advancement of the company. Future Development The management team are committed to continue investing in the growth and evolution of the business and the creation of new revenue streams. By constantly reviewing our business strategies and customer proposition, we aim to ensure that they remain perfectly aligned with both prevailing market demands and industry trends. Risks and uncertainties The directors have considered various relevant market and economic risks that may materially impact the business including supplier and customer credit terms, changes in interest rates, cashflow, pricing, market competition and current business trading trends to understand and model the financial impact. The directors have also considered the impact of increased interest rates, inflation and global affairs, and how these may disrupt their business model, strategy and operations. It is clear that there is a worldwide impact on the cost of particular goods, to include fuel, which in turn has increased the base costs of consumables in the business. The directors have considered the effect and believe that this will not significantly impact the ability to trade or going concern. Taking into account all of the above risks and the options available to mitigate them, the directors are satisfied that the financial statements should continue to be prepared on a going concern basis and that there are no material foreseeable risks to the business that haven't been assessed or disclosed.
This report was approved by the board of directors on 24 September 2024 and signed on behalf of the board by:
G H Q Burns
T M R Scholfield
Director
Director
K L Gates
P D Quinney
Director
Director
Registered office:
Camburgh House
27 New Dover Road
Canterbury
Kent
CT1 3DN
The Change Organisation Limited
Directors' Report
Year ended 31 March 2024
The directors present their report and the financial statements of the company for the year ended 31 March 2024 .
Directors
The directors who served the company during the year were as follows:
G H Q Burns
J M J Hogben
T M R Scholfield
K L Gates
P D Quinney
C H Burns
Dividends
The directors do not recommend the payment of a dividend.
Disclosure of information in the strategic report
The directors have chosen to include their review of the business, risks and uncertainties in the strategic report.
Directors' responsibilities statement
The directors are responsible for preparing the strategic report, directors' report and the financial statements in accordance with applicable law and regulations. Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and the profit or loss of the company for that period. In preparing these financial statements, the directors are required to: - select suitable accounting policies and then apply them consistently; - make judgments and accounting estimates that are reasonable and prudent; - prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business. The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. Auditor
Each of the persons who is a director at the date of approval of this report confirms that:
- so far as they are aware, there is no relevant audit information of which the company's auditor is unaware; and - they have taken all steps that they ought to have taken as a director to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information.
This report was approved by the board of directors on 24 September 2024 and signed on behalf of the board by:
G H Q Burns
T M R Scholfield
Director
Director
K L Gates
P D Quinney
Director
Director
Registered office:
Camburgh House
27 New Dover Road
Canterbury
Kent
CT1 3DN
The Change Organisation Limited
Independent Auditor's Report to the Members of The Change Organisation Limited
Year ended 31 March 2024
Opinion
We have audited the financial statements of The Change Organisation Limited (the 'company') for the year ended 31 March 2024 which comprise the statement of income and retained earnings, statement of financial position, statement of cash flows 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 FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice). In our opinion the financial statements: - give a true and fair view of the state of the company's affairs as at 31 March 2024 and of its profit for the year then ended; - have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; - have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Other information
The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. The directors are responsible for the other information. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
- the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
- the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report. We have nothing to report in respect of the following matters 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 directors' remuneration specified by law are not made; or - we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: We identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and then design and perform audit procedures responsive to those risks, including obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion. In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, we have considered; the nature of the industry, control environment and business performance. We also consider the results of our enquiries of management and the finance team, relating to their own identification and assessment of the risks of irregularities and possible related fraud. This includes asking questions and reviewing available documentation on their policies and procedures and performing tests of controls to evidence their effectiveness. Throughout the audit testing we are considering the incentives that may exist within the organisation for fraud. Key areas include timing of recognising income around the year end and posting of unusual journals. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override. We ensure we have an understanding of the relevant laws and regulations and remain alert to possible non-compliance throughout the audit. Despite proper planning and audit work in accordance with auditing standards there are inherent limitations and unavoidable risk that we may not detect some irregularities and material misstatements in the financial statements. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations. As part of an audit in accordance with ISAs (UK), we exercise professional judgment and maintain professional scepticism throughout the audit. We also: - Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. - Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the internal control. - Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors. - Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the company to cease to continue as a going concern. - Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
Use of this 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 the opinions we have formed.
Andrew Collyer
(Senior Statutory Auditor)
For and on behalf of
Burgess Hodgson LLP
Chartered accountants & statutory auditor
Camburgh House
27 New Dover Road
Canterbury
Kent
CT1 3DN
24 September 2024
The Change Organisation Limited
Statement of Income and Retained Earnings
Year ended 31 March 2024
2024
2023
Note
£
£
Turnover
4
64,770,329
74,525,622
Cost of sales
57,526,851
66,732,412
-------------
-------------
Gross profit
7,243,478
7,793,210
Administrative expenses
6,005,489
6,462,871
Other operating income
5
44,026
------------
------------
Operating profit
6
1,237,989
1,374,365
Interest payable and similar expenses
10
119,921
55,428
------------
------------
Profit before taxation
1,118,068
1,318,937
Tax on profit
11
270,226
253,196
------------
------------
Profit for the financial year and total comprehensive income
847,842
1,065,741
------------
------------
Retained earnings at the start of the year
4,443,999
3,378,258
------------
------------
Retained earnings at the end of the year
5,291,841
4,443,999
------------
------------
All the activities of the company are from continuing operations.
The Change Organisation Limited
Statement of Financial Position
31 March 2024
2024
2023
Note
£
£
£
Fixed assets
Tangible assets
12
205,025
222,633
Current assets
Stocks
13
5,342,309
4,719,122
Debtors
14
8,815,341
9,956,467
Cash at bank and in hand
108,493
113,105
-------------
-------------
14,266,143
14,788,694
Creditors: amounts falling due within one year
16
8,930,682
10,304,131
-------------
-------------
Net current assets
5,335,461
4,484,563
------------
------------
Total assets less current liabilities
5,540,486
4,707,196
Provisions
Taxation including deferred tax
17
23,645
38,197
------------
------------
Net assets
5,516,841
4,668,999
------------
------------
Capital and reserves
Called up share capital
20
225,000
225,000
Profit and loss account
21
5,291,841
4,443,999
------------
------------
Shareholders funds
5,516,841
4,668,999
------------
------------
These financial statements have been prepared in accordance with the provisions applicable to companies subject to the medium companies regime.
These financial statements were approved by the board of directors and authorised for issue on 24 September 2024 , and are signed on behalf of the board by:
G H Q Burns
T M R Scholfield
Director
Director
K L Gates
P D Quinney
Director
Director
Company registration number: 02874305
The Change Organisation Limited
Statement of Cash Flows
Year ended 31 March 2024
2024
2023
Note
£
£
Cash flows from operating activities
Profit for the financial year
847,842
1,065,741
Adjustments for:
Depreciation of tangible assets
106,770
93,821
Interest payable and similar expenses
119,921
55,428
Tax on profit
270,226
253,196
Accrued expenses
597,544
909,395
Changes in:
Stocks
( 623,187)
( 649,036)
Trade and other debtors
1,141,126
( 2,318,156)
Trade and other creditors
( 2,272,435)
393,615
------------
------------
Cash generated from operations
187,807
( 195,996)
Interest paid
( 119,921)
( 55,428)
Tax paid
( 246,913)
( 185,400)
---------
---------
Net cash used in operating activities
( 179,027)
( 436,824)
---------
---------
Cash flows from investing activities
Purchase of tangible assets
( 89,162)
( 113,382)
---------
---------
Net cash used in investing activities
( 89,162)
( 113,382)
---------
---------
Net decrease in cash and cash equivalents
( 268,189)
( 550,206)
Cash and cash equivalents at beginning of year
(387,203)
163,003
---------
---------
Cash and cash equivalents at end of year
15
( 655,392)
( 387,203)
---------
---------
The Change Organisation Limited
Notes to the Financial Statements
Year ended 31 March 2024
1. General information
The company is a private company limited by shares, registered in England and Wales. The address of the registered office is Camburgh House, 27 New Dover Road, Canterbury, Kent, CT1 3DN.
2. Statement of compliance
These financial statements have been prepared in compliance with FRS 102, 'The Financial Reporting Standard applicable in the UK and the Republic of Ireland'.
3. Accounting policies
Basis of preparation
The financial statements have been prepared on the historical cost basis, as modified by the revaluation of certain financial assets and liabilities and investment properties measured at fair value through profit or loss.
The financial statements are prepared in sterling, which is the functional currency of the entity.
Going concern
The directors have undertaken specific analysis into the potential business impact of current global events on costs and revenues and how these might also be managed and mitigated. The directors are satisfied that these reviews showed no material risks to the business and conclude that the financial statements should continue to be prepared on a going concern basis.
Judgements and key sources of estimation uncertainty
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported. Accounting estimates and assumptions are made concerning the future and, by their nature, will rarely equal the related actual outcome. These estimates and judgements are continually reviewed and are based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The key assumptions and other sources of estimation uncertainty that have a significant risk are as follows: (i) Bad debt - Directors have included bad debt provisions for items which have not been paid between the year end date and date of signing the accounts, where recoverability is uncertain. (ii) Purchase recognition - Directors recognise the purchase when significant risks and rewards of ownership are passed to them as buyer. They consider this has taken place on delivery and therefore record all deliveries not yet invoices as accruals at the year end. (iii) Useful economic life of fixed assets - The annual depreciation and amortisation charges are based upon management's assessment of the useful economic lives and residual values of the company's tangible assets. these are re-assessed annually and amended where necessary. (iv) Stock valuation - Stocks are measured at the lower of cost and estimated selling price less cost to complete and sell. The company periodically review their stock listing and provide for any items which are selling or expected to sell for less than cost. The directors have performed an analysis of unsold stock and the stock provision is calculated by assuming a reduction of 30% is required to sell any item of stock not sold 3 months past the year end, where the proportion of that stock item sold since the year end is less than 50%. At the year end this provision was £570,200 (2023: £949,243 at 25% on 2 months).
Revenue recognition
Turnover is measured at the fair value of the consideration received or receivable for goods supplied and services rendered, net of discounts and Value Added Tax. Revenue from the sale of goods is recognised when the significant risks and rewards of ownership have transferred to the buyer (usually on despatch of the goods); the amount of revenue can be measured reliably; it is probable that the associated economic benefits will flow to the entity; and the costs incurred or to be incurred in respect of the transactions can be measured reliably.
Income tax
The taxation expense represents the aggregate amount of current and deferred tax recognised in the reporting period. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, tax is recognised in other comprehensive income or directly in equity, respectively. Current tax is recognised on taxable profit for the current and past periods. Current tax is measured at the amounts of tax expected to pay or recover using the tax rates and laws that have been enacted or substantively enacted at the reporting date.
Deferred tax is recognised in respect of all timing differences at the reporting date. Unrelieved tax losses and other deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date that are expected to apply to the reversal of the timing difference.
Operating leases
Lease payments are recognised as an expense over the lease term on a straight-line basis. The aggregate benefit of lease incentives is recognised as a reduction to expense over the lease term, on a straight-line basis.
Tangible assets
Tangible assets are initially recorded at cost, and subsequently stated at cost less any accumulated depreciation and impairment losses. Any tangible assets carried at revalued amounts are recorded at the fair value at the date of revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses.
Depreciation
Depreciation is calculated so as to write off the cost or valuation of an asset, less its residual value, over the useful economic life of that asset as follows:
Plant and machinery
-
3 or 5 years straight line
Fixtures and fittings
-
5 year straight line
Motor vehicles
-
20% reducing balance
Impairment of fixed assets
A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date.
Stocks
Stocks are measured at the lower of cost and estimated selling price less costs to complete and sell. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing the stock to its present location and condition.
Finance leases and hire purchase contracts
Assets held under finance leases and hire purchase contracts are recognised in the statement of financial position as assets and liabilities at the lower of the fair value of the assets and the present value of the minimum lease payments, which is determined at the inception of the lease term. Any initial direct costs of the lease are added to the amount recognised as an asset. Lease payments are apportioned between the finance charges and reduction of the outstanding lease liability using the effective interest method. Finance charges are allocated to each period so as to produce a constant rate of interest on the remaining balance of the liability.
Provisions
Provisions are recognised when the entity has an obligation at the reporting date as a result of a past event, it is probable that the entity will be required to transfer economic benefits in settlement and the amount of the obligation can be estimated reliably. Provisions are recognised as a liability in the statement of financial position and the amount of the provision as an expense.
Financial instruments
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. 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. Loans and borrowings are initially recognised at the transaction price including transaction costs. Subsequently, they are measured at amortised cost using the effective interest rate method, less impairment. If an arrangement constitutes a finance transaction it is measured at present value.
Defined contribution plans
Contributions to defined contribution plans are recognised as an expense in the period in which the related service is provided. Prepaid contributions are recognised as an asset to the extent that the prepayment will lead to a reduction in future payments or a cash refund.
4. Turnover
Turnover arises from:
2024
2023
£
£
Sale of goods
64,770,329
74,525,622
-------------
-------------
The turnover is attributable to the one principal activity of the company. An analysis of turnover by the geographical markets that substantially differ from each other is given below:
2024
2023
£
£
United Kingdom
58,034,092
67,214,065
European Union
6,734,949
7,291,343
Other overseas
1,288
20,214
-------------
-------------
64,770,329
74,525,622
-------------
-------------
5. Other operating income
2024
2023
£
£
Management charges receivable
44,026
----
--------
6. Operating profit
Operating profit or loss is stated after charging/crediting:
2024
2023
£
£
Depreciation of tangible assets
106,770
93,821
Impairment of trade debtors
35,456
29,982
Foreign exchange differences
( 12,809)
23,952
---------
--------
7. Auditor's remuneration
2024
2023
£
£
Fees payable for the audit of the financial statements
16,000
15,000
--------
--------
Fees payable to the company's auditor and its associates for other services:
Other non-audit services
11,688
11,053
--------
--------
8. Staff costs
The average number of persons employed by the company during the year, including the directors, amounted to:
2024
2023
No.
No.
Production staff
14
14
Administrative staff
53
53
Management staff
3
5
----
----
70
72
----
----
The aggregate payroll costs incurred during the year, relating to the above, were:
2024
2023
£
£
Wages and salaries
3,618,498
4,080,688
Social security costs
471,090
470,361
Other pension costs
67,075
104,121
------------
------------
4,156,663
4,655,170
------------
------------
9. Directors' remuneration
The directors' aggregate remuneration in respect of qualifying services was:
2024
2023
£
£
Remuneration
842,417
997,841
Company contributions to defined contribution pension plans
10,614
43,808
---------
------------
853,031
1,041,649
---------
------------
Remuneration of the highest paid director in respect of qualifying services:
2024
2023
£
£
Aggregate remuneration
387,914
357,279
Company contributions to defined contribution pension plans
1,996
1,860
---------
---------
389,910
359,139
---------
---------
10. Interest payable and similar expenses
2024
2023
£
£
Interest on obligations under finance leases and hire purchase contracts
65
659
Other interest payable and similar charges
119,856
54,769
---------
--------
119,921
55,428
---------
--------
11. Tax on profit
Major components of tax expense
2024
2023
£
£
Current tax:
UK current tax expense
284,778
242,835
Adjustments in respect of prior periods
( 16,084)
---------
---------
Total current tax
284,778
226,751
---------
---------
Deferred tax:
Origination and reversal of timing differences
( 14,552)
26,445
---------
---------
Tax on profit
270,226
253,196
---------
---------
Reconciliation of tax expense
The tax assessed on the profit on ordinary activities for the year is lower than (2023: higher than) the standard rate of corporation tax in the UK of 25 % (2023: 19 %).
2024
2023
£
£
Profit on ordinary activities before taxation
1,118,068
1,318,937
------------
------------
Profit on ordinary activities by rate of tax
279,517
250,598
Effect of expenses not deductible for tax purposes
3,216
65
Effect of capital allowances and depreciation
( 12,507)
9,450
Effect of change in UK tax rates
9,167
Under/over provision in previous year
(16,084)
------------
------------
Tax on profit
270,226
253,196
------------
------------
Corporation tax increases to 25% (effective from 1 April 2023) were substantively enacted on 24 May 2021. The deferred tax liability has therefore been calculated based on the enacted rates.
12. Tangible assets
Plant and machinery
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
Cost
At 1 April 2023
872,236
294,201
41,771
1,208,208
Additions
73,290
15,872
89,162
---------
---------
--------
------------
At 31 March 2024
945,526
310,073
41,771
1,297,370
---------
---------
--------
------------
Depreciation
At 1 April 2023
759,723
213,153
12,699
985,575
Charge for the year
72,426
28,530
5,814
106,770
---------
---------
--------
------------
At 31 March 2024
832,149
241,683
18,513
1,092,345
---------
---------
--------
------------
Carrying amount
At 31 March 2024
113,377
68,390
23,258
205,025
---------
---------
--------
------------
At 31 March 2023
112,513
81,048
29,072
222,633
---------
---------
--------
------------
13. Stocks
2024
2023
£
£
Finished goods and goods for resale
5,342,309
4,719,122
------------
------------
14. Debtors
2024
2023
£
£
Trade debtors
7,542,447
8,854,891
Prepayments and accrued income
74,071
60,700
Directors loan account
81,519
104,396
Other debtors
1,117,304
936,480
------------
------------
8,815,341
9,956,467
------------
------------
Included in trade debtors is £5,955,922 (2023: £8,491,742) in respect of factored debts.
15. Cash and cash equivalents
Cash and cash equivalents comprise the following:
2024
2023
£
£
Cash at bank and in hand
108,493
113,105
Bank overdrafts
( 763,885)
( 500,308)
---------
---------
( 655,392)
( 387,203)
---------
---------
16. Creditors: amounts falling due within one year
2024
2023
£
£
Bank loans and overdrafts
763,885
500,308
Trade creditors
238,553
1,484,292
Accruals and deferred income
4,396,215
3,798,671
Corporation tax
280,700
242,835
Social security and other taxes
112,660
122,498
Amounts advanced from factor
2,990,191
4,001,444
Other creditors
148,478
154,083
------------
-------------
8,930,682
10,304,131
------------
-------------
Amounts advanced from factors of £2,990,191 (2023: £4,001,444) are secured by a fixed charge over all UK trade debts together with their related rights.
Bank overdrafts of £763,885 (2023: £500,308) are secured by a fixed and floating charge over the assets of the company.
17. Provisions
Deferred tax (note 18)
£
At 1 April 2023
38,197
Additions
( 14,552)
--------
At 31 March 2024
23,645
--------
18. Deferred tax
The deferred tax included in the statement of financial position is as follows:
2024
2023
£
£
Included in provisions (note 17)
23,645
38,197
--------
--------
The deferred tax account consists of the tax effect of timing differences in respect of:
2024
2023
£
£
Accelerated capital allowances
23,645
38,197
--------
--------
19. Employee benefits
Defined contribution plans
The amount recognised in profit or loss as an expense in relation to defined contribution plans was £ 67,075 (2023: £ 104,121 ).
20. Called up share capital
Issued, called up and fully paid
2024
2023
No.
£
No.
£
'A' Ordinary shares of £ 1 each
173,565
173,565
173,565
173,565
'B' Ordinary shares of £ 1 each
32,153
32,153
32,153
32,153
'C' Ordinary shares of £ 1 each
12,847
12,847
12,847
12,847
'D' Ordinary shares of £ 1 each
6,435
6,435
6,435
6,435
---------
---------
---------
---------
225,000
225,000
225,000
225,000
---------
---------
---------
---------
21. Reserves
Profit and loss account - This reserve records retained earnings and accumulated losses.
22. Analysis of changes in net debt
At 1 Apr 2023
Cash flows
At 31 Mar 2024
£
£
£
Cash at bank and in hand
113,105
(4,612)
108,493
Bank overdrafts
(500,308)
(263,577)
(763,885)
---------
---------
---------
( 387,203)
( 268,189)
( 655,392)
---------
---------
---------
23. Operating leases
The total future minimum lease payments under non-cancellable operating leases are as follows:
2024
2023
£
£
Not later than 1 year
39,731
38,738
Later than 1 year and not later than 5 years
1,067
9,038
--------
--------
40,798
47,776
--------
--------
24. Directors' advances, credits and guarantees
During the year the directors received advances of £2,374(2023: £140,568) from the company and made repayments of £59,618 (2023: £85,946). At the year end the directors owed the company £47,352 (2023: £104,596). There was no interest charged on these loans.
25. Related party transactions
At the year end the company had trade debtors and trade creditors of £688,612 and £779,924 respectively (2023: £1,238,828 trade debtor and £1,090,874 trade creditor) with companies associated through common control. During the year the company had sales and purchases of £6,142,033 (2023: £10,684,652) and £1,217,187 (2023: £4,600,002) respectively with companies associated through common control and directorship. During the year the company was charged £552,500 (2023: £470,000) in management charges by companies associated through common control and directorship. At the year end the company had accruals of £350,000 (2023: £110,000) in respect of these charges. During the year the company also charged £nil (2023: £44,026) of management charges to companies associated through common control and directorship. At the year end the company had informal loan balances receivable of £89,565 (2023: £518,411) with companies associated through common control and directorship.
26. Controlling party
During the period the company was under the control of Mr G H Q Burns .