Company registration number 03830499 (England and Wales)
SENTRY LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
SENTRY LIMITED
COMPANY INFORMATION
Directors
R C Arkley
J P B Barrett
P E Christian
C Clayton
The Lord Fuller OBE
A N Smith
A T Tyrrell
Secretary
R C Arkley
Company number
03830499
Registered office
7a Hill View Business Park
Old Ipswich Road
Claydon
IPSWICH
Suffolk
IP6 0AJ
Auditor
Argents Audit Services Limited
15 Palace Street
NORWICH
Norfolk
United Kingdom
NR3 1RT
SENTRY LIMITED
CONTENTS
Page
Strategic report
1 - 3
Directors' report
4
Directors' responsibilities statement
5
Independent auditor's report
6 - 8
Profit and loss account
9
Statement of comprehensive income
10
Balance sheet
11 - 12
Statement of changes in equity
13
Statement of cash flows
14
Notes to the financial statements
15 - 34
SENTRY LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2024
- 1 -
The directors present the strategic report for the year ended 31 March 2024.
The statutory results for the Company are to be found on page 9. This result fully reflects the net margin of the 2023 harvest and costs of establishment of the 2024 harvest.
Business Review
Strategic Context
The Directors are never satisfied with reporting a loss for the year but in this case the shortfall of £205,210 in 2024 must be compared with the exceptional profit of £813,552 in the preceding year, 2023.
The financial year 2023, which incorporated the 2022 Harvest which benefited from exceptionally high grain prices produced with low-cost inputs purchased before the disruption of the Ukraine war and parallel energy crisis. By contrast, the financial year 2024, which incorporates the 2023 harvest, suffered from severely reduced output prices but unprecedented high input costs for seeds, fertilisers, crop protection products and fuel driven by the same factors that drove up crop prices in 2022. It was inevitable that these high costs and low prices would damage profitability for Harvest 2023 embedded in 2024’s results.
The Directors feel that the average of the two years profit at £304,171 is at the lower end of acceptable values but it consistent with previously reported Pre-Ukraine values and remains a going concern.
The Company continues to invest in modern, high tech farming machinery through purchase, hire purchase or contract hire agreements. The day-to-day trading is supported via its own working capital or using a bank overdraft facility, which is reviewed and renewed annually. The Company has more than adequate resources for the foreseeable future and continues to adopt the going concern basis in preparing the annual report and financial statements.
The Directors are following the plan to reduce long term costs, reduce risk and optimise returns for Sentry, and our clients. We have had several opportunities present themselves during the year. The Company has good cash reserves available for growth opportunities. The Directors are confident the decisions made this year will support future growth and profitability next year and beyond.
SENTRY LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 2 -
Business Review for Financial Year 2024
Much effort and hard work has been put in by all employees to minimise the Company’s loss. The difficult year has impacted across the agricultural sector and the Directors feel that we have made sound strategic improvements both technically and structurally, particularly focussing on the carbon footprint of our business, consequently the loss has been contained. Our aim has been to optimise applications, reduce waste and look after our surrounding environment.
The 2023 harvest was sporadic, weather hampered harvest progress, decreasing crop quality over time. Although there are regional variances, generally drilling plans were negatively affected by adverse weather conditions.
A new marketing campaign was launched in March 2023 and has been rolled out in the Autumn of 2023. A new website was launched in the Spring of 2024. Our aim is to better present our services to the rural marketplace. Our teams are here to deliver forward-thinking solutions that help our clients sustainably grow their businesses whilst protecting the environments in which we operate, and we feel our new logo perfectly represents this client promise. We have continued to increase the area of quality land and reduce some of the land we farmed where margins are challenging.
There has been a correction in the commodities markets and growing costs for the 2024 crop are significantly lower than those of the previous year however forward selling prices remain depressed and there is no certainty that these will exceed the costs of production in all circumstances.
During the year, the Company’s Business consultancy division ‘Business Solutions’ has experienced rapid growth with the recruitment of a further 2 new employees to join the team. This sector which is outside of our core business farming utilising our core farming knowledge in delivering advice to external clients both new and old. They come to us as they believe we are a one stop shop with multi-faceted expertise.
Technological advances are key to the Company’s future development, and this is an area the Company is actively pursuing. We are running a joint venture with British Sugar, BBRO and ourselves to evaluate the use of robotics. We are in our second year of a two-year project drilling and spraying sugar beet, looking at how we can reduce our environmental impact through lower use of pesticides as well as reduced impact on our soils.
Climate change now dominates the agenda, and we are working to improve soil structures by rolling out our soil management strategy.
The new Government is due to announce policy on their Environmental Land Management Schemes paying farmers for the production of public goods, we are not expecting huge changes in the short term. This is not intended to be a direct replacement for the Basic Payment Scheme which is gradually being phased out with the last annual payment due in 2027. We have, to date, used the schemes and plan to use them going forward to create both efficiencies and promote the biodiversity across our holdings.
Increased bond rates have reduced the FRS102 accounting valuation of the Company’s defined benefit pension scheme from £2,164 Mill deficit to £2,079 Mill deficit. The Pension Scheme’s last Triennial valuation took place on 31st December 2021 and was concluded in December 2022. The SFO valuation on 31st December 2021 was £1.809 Mill, 83% funding level. The annual funding required by the Company has increased from £109,800pa to £186,000pa. A Triennial valuation will take place on 31st December 2024, adhering to the new Pensioners Regulators Funding Code which comes into effect in September 2024.
Employee owned & managed
Sentry is an Employee-Owned business, and this concept provides the employees a tremendous opportunity to contribute to the development of their Company of which they can own a stake. A tax efficient Share Incentive Plan (SIP) was introduced on 1st April 2021 allowing employees to save monthly, acquiring shares in a tax effective manner and the uptake by employees to this scheme has been positive.
The Management Team continues to explore new opportunities. New farming opportunities continue to come forward at an increasing rate and are considered for their suitability. The Directors remain very positive regarding the outlook for future growth of the Company.
SENTRY LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 3 -
Principal risks and uncertainties
It is the aim of the Directors to minimise the exposure to risk in all areas of the business but, as is common with most businesses in our industry, we are subject to various risks. The Directors consider the most important of these risks to be credit, liquidity, and interest rates. Climate change and consequent regulatory change remains a huge issue and one that poses numerous potential risks, on the ground we are creating more robust and soil friendly systems with a lighter footprint and recognising our carbon impact. We see political intervention will create both advantages and hazards for UK Agriculture to navigate through.
The Directors have considered and assessed the foreseeable uncertainties associated with the industry and continue, along with senior management, to take appropriate actions to minimise these risks and where possible create opportunities from them in what is a volatile marketplace.
Financial risk - In common with other businesses, the Company aims to minimise financial risk. The measures used by the Directors to manage this risk include the preparation of profit forecasts, regular monitoring of actual performance against these forecasts and ensuring that adequate financing facilities are in place to meet the requirements of the business are all in process.
Price Risk - The Directors consider a principal risk of the business to be centred on commodity prices which have been subject to significant volatility, particularly in the last 12 months., The strong relationships built up with key customers gives insight into the market direction allowing us to respond quickly thus protecting the company from exposure to sudden volatility.
Credit risk - The Company mainly trades with long standing customers, however credit checks are made of any new customers prior to trading. The nature of these relationships assists management in controlling its credit risk in addition to normal management process.
Liquidity risk - The Directors’ control and monitor the Company's cash flow daily. A monthly cash reporting system is used throughout the entire Company.
Financial Key Performance Indicators
The Directors are of the opinion that analysis using key performance indicators is not necessary for an understanding of the development, performance, or position of the business.
Employees
The Board are extremely appreciative of all the hard work and efforts of our employees who have continued to work tremendously hard during another challenging year both out on the ground as well as in their respective administrative and advisory roles.
This report was approved by the board and signed on its behalf.
R C Arkley
Director
3 October 2024
SENTRY LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2024
- 4 -
The directors present their annual report and financial statements for the year ended 31 March 2024.
Principal activities
The Company continues to farm on tenanted land, provide contract and management service for clients farms and to focus on agricultural, and associated rural and environment service.
Results and dividends
The loss for the year, after taxation, amounted to £205,210 (2023: profit of £813,552).
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 C Arkley
J P B Barrett
P E Christian
C Clayton
The Lord Fuller OBE
A N Smith
A T Tyrrell
Charitable contributions
During the year the Company made payments of £5,757 (2023 - £4,389) in respect of charitable donations.
Future developments
The directors do not expect any significant changes to the structure of the business in the coming years. The management team in place continue to look to explore forthcoming opportunities created by market changes, and intend to develop these for the benefit of the Company and our clients. The directors hold a very positive outlook for future growth of the Company.
Matters covered in the Strategic Report
Financial risk, price risk, credit risk and liquidity risk management have been included within the strategic report.
Statement of disclosure to auditor
Each of the persons who are directors at the time when this Directors' Report is approved has confirmed that:
· so far as the director is aware, there is no relevant audit information of which the Company's auditors are unaware, and
· the director 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.
Medium-sized companies exemption
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
On behalf of the board
R C Arkley
Director
3 October 2024
SENTRY LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 MARCH 2024
- 5 -
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.
SENTRY LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF SENTRY LIMITED
- 6 -
Opinion
We have audited the financial statements of Sentry Limited (the 'company') for the year ended 31 March 2024 which comprise the profit and loss account, the statement of comprehensive income, the balance sheet, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
give a true and fair view of the state of the company's affairs as at 31 March 2024 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.
SENTRY LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF SENTRY LIMITED (CONTINUED)
- 7 -
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.
Identifying and assessing potential risks related to irregularities
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, we considered the following:
- enquiring of management, including obtaining and reviewing supporting documentation concerning the company's policies and procedures relating to:
- identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance;
- detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud;
- the internal controls established to mitigate risks related to fraud or non-compliance with laws and regulations;
- discussing among the engagement team regarding how and where fraud might occur in the financial statements and any potential indicators of fraud; and
- obtaining an understanding of the legal and regulatory framework that the company operates in, focusing on those laws and regulations that had a direct effect on the financial statements or that had a fundamental effect on the operations of the companies. The key laws and regulations we considered in this context included the Companies Act 2006, tax legislation, and laws specifically applicable to sector in which the company operates.
SENTRY LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF SENTRY LIMITED (CONTINUED)
- 8 -
Audit response to risks identified
Our procedures to respond to risks identified included the following:
- reviewing the Financial Statement disclosures and testing to supporting documentation to assess compliance with relevant laws and regulations discussed above;
- enquiring of management, concerning actual and potential litigation and claims;
- performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;
- reading minutes of meetings of those charged with governance, reviewing internal controls/systems notes and reviewing correspondence with HMRC; and
- in addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.
- Assessing compliance with relevant laws and regulations, including Equality Act 2010, Employers' Liability Act 1969 and Health & Safety at Work Act 1974, to which we found no material shortfalls or had any concerns.
- Assessing compliance with requirements as set out by Department for Environment, Food & Rural Affairs, Rural Payments Agency and Environment Agency, to which we had no concerns.
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.
Mark Johnstone
Senior Statutory Auditor
For and on behalf of Argents Audit Services Limited
3 October 2024
Chartered Accountants
Statutory Auditor
15 Palace Street
NORWICH
Norfolk
United Kingdom
NR3 1RT
SENTRY LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 MARCH 2024
- 9 -
2024
2023
Notes
£
£
Turnover
4
9,700,779
12,464,449
Cost of sales
(9,405,720)
(10,921,723)
Gross profit
295,059
1,542,726
Administrative expenses
(436,504)
(442,549)
Operating (loss)/profit
5
(141,445)
1,100,177
Interest receivable and similar income
24,311
65,554
Interest payable and similar expenses
8
(180,184)
(128,945)
(Loss)/profit before taxation
(297,318)
1,036,786
Tax on (loss)/profit
9
92,108
(223,234)
(Loss)/profit for the financial year
(205,210)
813,552
The profit and loss account has been prepared on the basis that all operations are continuing operations.
The notes on pages 15 to 34 form part of these financial statements.
SENTRY LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2024
- 10 -
2024
2023
£
£
(Loss)/profit for the year
(205,210)
813,552
Other comprehensive income
Actuarial gain on defined benefit pension schemes
56,000
1,848,000
Actual return on assets less interest
(60,000)
(1,590,000)
Movement on deferred tax relating to pension gains
(22,250)
(80,250)
Other comprehensive income for the year
(26,250)
177,750
Total comprehensive income for the year
(231,460)
991,302
The notes on pages 15 to 34 form part of these financial statements.
SENTRY LIMITED
BALANCE SHEET
AS AT
31 MARCH 2024
31 March 2024
- 11 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
10
2,219,443
2,167,029
Investments
11
263,710
275,548
2,483,153
2,442,577
Current assets
Stocks
14
1,106,492
1,144,247
Debtors falling due after more than one year
15
682,879
638,731
Debtors falling due within one year
15
3,022,252
3,306,634
Cash at bank and in hand
763,034
1,781,795
5,574,657
6,871,407
Creditors: amounts falling due within one year
Loans and overdrafts
16
21,313
58,649
Obligations under finance leases
17
352,352
385,234
Taxation and social security
251,803
248,798
Other creditors
1,047,956
1,911,413
Accruals and deferred income
417,996
548,224
2,091,420
3,152,318
Net current assets
3,483,237
3,719,089
Total assets less current liabilities
5,966,390
6,161,666
Creditors: amounts falling due after more than one year
19
(700,184)
(579,000)
Provisions for liabilities
Defined benefit pension liability
21
2,079,000
2,164,000
(2,079,000)
(2,164,000)
Net assets
3,187,206
3,418,666
Capital and reserves
Called up share capital
22
218,525
218,525
Share premium account
23
753,750
753,750
Capital redemption reserve
23
32,725
32,725
Profit and loss reserves
23
2,182,206
2,413,666
Total equity
3,187,206
3,418,666
The notes on pages 15 to 34 form part of these financial statements.
SENTRY LIMITED
BALANCE SHEET (CONTINUED)
AS AT
31 MARCH 2024
31 March 2024
- 12 -
The financial statements were approved by the board of directors and authorised for issue on 3 October 2024 and are signed on its behalf by:
R C Arkley
P E Christian
Director
Director
Company Registration No. 03830499
SENTRY LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2024
- 13 -
Share capital
Share premium account
Capital redemption reserve
Profit and loss reserves
Total
£
£
£
£
£
Balance at 1 April 2022
218,525
753,750
32,725
1,422,364
2,427,364
Year ended 31 March 2023:
Profit
-
-
-
813,552
813,552
Other comprehensive income:
Actuarial gains on defined benefit plans
-
-
-
258,000
258,000
Tax relating to other comprehensive income
-
-
-
(80,250)
(80,250)
Total comprehensive income
-
-
-
991,302
991,302
Balance at 31 March 2023
218,525
753,750
32,725
2,413,666
3,418,666
Year ended 31 March 2024:
Loss
-
-
-
(205,210)
(205,210)
Other comprehensive income:
Actuarial gains on defined benefit plans
-
-
-
(4,000)
(4,000)
Tax relating to other comprehensive income
-
-
-
(22,250)
(22,250)
Total comprehensive income
-
-
-
(231,460)
(231,460)
Balance at 31 March 2024
218,525
753,750
32,725
2,182,206
3,187,206
The notes on pages 15 to 34 form part of these financial statements.
SENTRY LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2024
- 14 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash (absorbed by)/generated from operations
2
(656,238)
1,426,631
Interest paid
(83,184)
(62,945)
Net cash (outflow)/inflow from operating activities
(739,422)
1,363,686
Investing activities
Purchase of tangible fixed assets
(827,021)
(767,145)
Proceeds from disposal of tangible fixed assets
460,568
407,355
Repayment of loans
19,398
19,398
Interest received
16,751
16,771
Net cash used in investing activities
(330,304)
(323,621)
Financing activities
Repayment of bank loans
(60,431)
(57,403)
New finance leases advanced
660,898
572,717
Payment of finance leases obligations
(549,502)
(522,580)
Net cash generated from/(used in) financing activities
50,965
(7,266)
Net (decrease)/increase in cash and cash equivalents
(1,018,761)
1,032,799
Cash and cash equivalents at beginning of year
1,781,795
748,996
Cash and cash equivalents at end of year
763,034
1,781,795
The notes on pages 15 to 34 form part of these financial statements.
SENTRY LIMITED
STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 15 -
1
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.
Impairment of 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 current credit rating of the debtor, the ageing profile of debtors and historical experience. See Note 15 for the net carrying amount of the debtors.
2
Cash (absorbed by)/generated from operations
2024
2023
£
£
(Loss)/profit for the year after tax
(205,210)
813,552
Adjustments for:
Taxation (credited)/charged
(92,108)
223,234
Finance costs
180,184
128,945
Investment income
(24,311)
(65,554)
Gain on disposal of tangible fixed assets
(228,831)
(178,030)
Depreciation and impairment of tangible fixed assets
542,870
505,882
Pension contributions to Defined Benefit scheme
(186,000)
(129,000)
Movements in working capital:
Decrease in stocks
37,755
159,393
Decrease/(increase) in debtors
298,737
(79,959)
(Decrease)/increase in creditors
(979,325)
48,167
Cash (absorbed by)/generated from operations
(656,238)
1,426,631
SENTRY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
- 16 -
3
Accounting policies
Company information
Sentry Limited is a private company limited by shares incorporated in England and Wales. The registered office is 7a Hill View Business Park, Old Ipswich Road, Claydon, IPSWICH, Suffolk, IP6 0AJ. The registered number of the company is 03830499.
3.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention, [modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value]. The principal accounting policies adopted are set out below.
Consolidated financial statements have not been prepared under sections 402 and 405 of Companies Act 2006.
3.2
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.
The Company continues to invest in farming machinery through purchase, hire purchase or contract hire agreements. The day-to-day trading is supported via its own working capital or by the use of a bank overdraft facility, which is reviewed and renewed annually. The Directors have a strong expectation that the Company has more than adequate resources to continue in operational existence for the foreseeable future.
The Company’s bank balance at the year end was £763,034 (2023: £1,781,795).
The impact of the war in Ukraine has had a resounding effect on commodity prices and fuel. The Directors take advice from an experienced external Company to minimise exposure to volatile crop prices. Fuel sensitivity has been undertaken on a range of fuel prices in order to assess the impact to the Company’s bottom line and such risk has been carefully managed with fuel escalators to contracting work where they were not already in place.
3.3
Revenue
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 at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:
Rendering of goods
Revenue from the sale of arable crops are recognised in the period in which the relevant goods are harvested.
SENTRY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
3
Accounting policies
(Continued)
- 17 -
Rendering of services
Revenue from contract farming service operations are recognised in the period in which the services are provided to the customer.
Revenue from contracting farming service divisible surpluses are recognised in the period in which the relevant harvest falls. Where this has not been realised by the year end the amounts receivable are calculated on individual financial projections using known data, market information and industry experience.
Revenue from advisory services are recognised in the period in which the services are provided to the customer.
Rent receivable
Revenue in respect of rent receivable and cropping licenses is recognised in line with the harvest period to which it relates.
Basic payment and environmental schemes
These are government subsidies and are recognised inline with the government grants accounting policy.
3.4
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:
Improvements
10% straight line
Tractors and machinery
20% reducing balance and 33% straight line
Electric vehicles
20% reducing balance
Office equipment
33% straight line and 20% straight line
Motor vehicles
25% straight line
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
3.5
Fixed asset investments
Investments in partnerships are included at cost on the balance sheet and any income and profits received from the investment are included in the Income Statement as they occur.
Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The company considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.
Entities in which the company has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.
SENTRY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
3
Accounting policies
(Continued)
- 18 -
3.6
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
3.7
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.
Fuel and wearing metal stock are held at cost.
Growing crops in stock as at 31 March each year incorporate two elements. Raw material inputs are included at the weighted average cost whilst the value of cultivations is prepared using rates laid down by the Central Association of Agricultural Valuers to cover the cost of labour and machinery used in the direct crop applications.
Crops in store are stated, as per Section 34 of FRS 102, at their fair value less costs to sell to align the profit recognition in line with the harvest year. Methodology applied in the valuation references the market price achieved for each crop in store, as it is the Company aim to sell its product ahead of time under contract.
3.8
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
SENTRY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
3
Accounting policies
(Continued)
- 19 -
3.9
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.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
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.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
SENTRY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
3
Accounting policies
(Continued)
- 20 -
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
3.10
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 or loss for the year. Taxable profit or loss differs from net profit or loss 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 position for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset 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.
SENTRY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
3
Accounting policies
(Continued)
- 21 -
3.11
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.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
3.12
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
The cost of providing benefits under defined benefit plans is determined separately for each plan using the projected unit credit method, and is based on actuarial advice.
The change in the net defined benefit liability arising from employee service during the year is recognised as an employee cost. The cost of plan introductions, benefit changes, settlements and curtailments are recognised as an expense in measuring profit or loss in the period in which they arise.
The net interest element is determined by multiplying the net defined benefit liability by the discount rate, taking into account any changes in the net defined benefit liability during the period as a result of contribution and benefit payments. The net interest is recognised in profit or loss as other finance revenue or cost.
Remeasurement changes comprise actuarial gains and losses, the effect of the asset ceiling and the return on the net defined benefit liability excluding amounts included in net interest. These are recognised immediately in other comprehensive income in the period in which they occur and are not reclassified to profit and loss in subsequent periods.
The net defined benefit pension asset or liability in the balance sheet comprises the total for each plan of the present value of the defined benefit obligation (using a discount rate based on high quality corporate bonds), less the fair value of plan assets out of which the obligations are to be settled directly. Fair value is based on market price information, and in the case of quoted securities is the published bid price. The value of a net pension benefit asset is limited to the amount that may be recovered either through reduced contributions or agreed refunds from the scheme.
3.13
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.
3.14
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.
SENTRY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
3
Accounting policies
(Continued)
- 22 -
3.15
Defined contribution pension plan
The Company contributes to 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 Income Statement 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.
Defined benefit pension plan
A defined benefit plan defines the pension benefit that the employee will receive on retirement,usually dependent upon several factors including but not limited to age, length of service and remuneration. A defined benefit plan is a pension plan that is not a defined contribution plan.
The scheme closed to future accrual on 31 December 2009 and all accrued pension benefits at the date of closure are increased each year in line with inflation.
The liability recognised in the Statement of Financial Position in respect of the Defined Benefit Plan is the present value of the defined benefit obligation at the end of the reporting date less the fair value of plan assets at the reporting date (if any) out of which the obligations are to be settled.
The defined benefit obligation is calculated using the projected unit credit method. Annually the Company engages independent actuaries to calculate the obligation. The present value is determined by discounting the estimated future payments using market yields on high quality corporate bonds that are denominated in sterling and that have terms approximating to the estimated period of the future payments ('discount rate').
The fair value of plan assets is measured in accordance with the FRS 102 fair value hierarchy and in accordance with the Company's policy for similarly held assets. This includes the use of appropriate valuation techniques.
Actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions are charged or credited to other comprehensive income.
The cost of the Defined Benefit Plan, recognised in profit or loss as employee costs, except where included in the cost of an asset, comprises:
a) the increase in net pension benefit liability arising from employee service during the period; and
b) the cost of plan introductions, benefit changes, curtailments and settlements.
The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit obligation and the fair value of plan assets. This cost is recognised in profit or loss as an "Other finance expense".
Sentry Limited continues to have obligations to pay into the Defined benefit pension scheme which closed to employees on 31 December 2009. The cost of these benefits and the present value of the obligation depend on a number of factors, including: life expectancy, salary increases, asset valuations and the discount rate on corporate bonds. Management estimates these factors in determining the net pension obligation in the balance sheet. The assumptions reflect historical experience and current trends.
Included in the obligation value for the period ended 31 March 2024 is past service costs relating to the impact of GMP equalisation as expensed in the year to 30 April 2019. The Actuary estimated the GMP equalisation allowance having regard to scheme specific matters such as the benefit structure and liability profile. Further details of the adjustment are included in note 21.
3.16
Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
SENTRY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
3
Accounting policies
(Continued)
- 23 -
3.17
Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
4
Turnover and other revenue
All turnover arose within the United Kingdom.
2024
2023
£
£
Turnover analysed by class of business
Rendering of goods
3,937,393
5,420,298
Rendering of services
5,390,229
6,611,744
Rent receivable and cropping licence income
55,902
62,861
Basic payment scheme and environmental schemes
317,255
369,546
9,700,779
12,464,449
2024
2023
£
£
Other revenue
Interest income
16,751
16,771
5
Operating (loss)/profit
2024
2023
Operating (loss)/profit for the year is stated after charging:
£
£
Fees payable to the company's auditor for the audit of the company's financial statements
12,500
12,500
Operating lease rentals - plant and machinery
1,076,329
759,904
Operating lease rentals - other
658,892
870,247
6
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2024
2023
Number
Number
Farming
34
34
Advisory
18
15
Management (directors)
4
4
Administration
3
3
Total
59
56
SENTRY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
6
Employees
(Continued)
- 24 -
Their aggregate remuneration comprised:
2024
2023
£
£
Wages and salaries
2,128,315
2,138,343
Social security costs
219,075
215,291
Pension costs
123,815
96,237
2,471,205
2,449,871
The total key management personnel compensation (including directors) in the year was £474,176 (2023 - £520,587), including the related national insurance contributions equating to £44,788 (2023 - £52,086).
7
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
373,126
364,556
Company pension contributions to defined contribution schemes
56,262
36,618
429,388
401,174
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 4 (2023 - 4).
Remuneration disclosed above include the following amounts paid to the highest paid director:
2024
2023
£
£
Remuneration for qualifying services
118,745
107,775
Company pension contributions to defined contribution schemes
13,090
12,452
8
Interest payable and similar expenses
2024
2023
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
4,592
6,748
Other interest on financial liabilities
20,611
14,087
25,203
20,835
Other finance costs:
Interest on finance leases and hire purchase contracts
57,981
42,110
Other interest
97,000
66,000
180,184
128,945
SENTRY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 25 -
9
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
(11,355)
11,355
Deferred tax
Origination and reversal of timing differences
(80,753)
211,879
Total tax (credit)/charge
(92,108)
223,234
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:
2024
2023
£
£
(Loss)/profit before taxation
(297,318)
1,036,786
Expected tax (credit)/charge based on the standard rate of corporation tax in the UK of 19.00% (2023: 19.00%)
(56,490)
196,989
Tax effect of expenses that are not deductible in determining taxable profit
1,823
9,859
Tax effect of income not taxable in determining taxable profit
(296)
(9,269)
Other permanent differences
(760)
49,020
Capital gains
(95)
(74)
Adjustment to deferred tax to average rate
(14,040)
70,111
Other differences leading to a decrease in the tax charge
(13,152)
Taxation (credit)/charge for the year
(69,858)
303,484
In addition to the amount (credited)/charged to the profit and loss account, the following amounts relating to tax have been recognised directly in other comprehensive income:
2024
2023
£
£
Deferred tax arising on:
Actuarial differences recognised as other comprehensive income
22,250
80,250
Factors that may affect future tax charges:
The Company has estimated losses of £1,508,453 (2023 - £683,891) available for carry forward against future trading profits.
SENTRY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 26 -
10
Tangible fixed assets
Improvements
Tractors and machinery
Electric vehicles
Office equipment
Motor vehicles
Total
£
£
£
£
£
£
Cost
At 1 April 2023
43,913
4,517,742
11,585
51,868
252,000
4,877,108
Additions
15,944
739,322
53,755
18,000
827,021
Disposals
(517,470)
(23,487)
(540,957)
Transfers
(69,217)
(8,652)
(77,869)
Reclassifications
42,380
(42,380)
At 31 March 2024
59,857
4,670,377
107,720
51,868
195,481
5,085,303
Depreciation and impairment
At 1 April 2023
40,068
2,477,753
1,690
38,328
152,240
2,710,079
Depreciation charged in the year on owned assets
3,030
270,146
21,840
2,150
4,709
301,875
Depreciation charged in the year on financed assets
222,274
18,721
240,995
Eliminated in respect of disposals
(289,091)
(20,129)
(309,220)
Reclassifications
1,413
(1,413)
Transfers
(69,217)
(8,652)
(77,869)
At 31 March 2024
43,098
2,611,865
24,943
40,478
145,476
2,865,860
Carrying amount
At 31 March 2024
16,759
2,058,512
82,777
11,390
50,005
2,219,443
At 31 March 2023
3,845
2,039,989
9,895
13,540
99,760
2,167,029
The net book value of assets held under finance leases or hire purchase contracts at the year end, included above, are as follows:
2024
2023
£
£
Tractors and machinery
1,035,034
1,104,948
Electric vehicles
74,882
Motor vehicles
41,497
1,109,916
1,146,445
SENTRY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 27 -
11
Fixed asset investments
2024
2023
Notes
£
£
Investments in subsidiaries
12
140,605
140,605
Investments in associates
13
33,000
33,000
Investments in partnerships
90,105
101,943
263,710
275,548
Movements in fixed asset investments
Investments in subsidiary companies
Investments in assosciated companies
Interest in trading partnership
Total
£
£
£
£
Cost or valuation
At 1 April 2023
140,605
33,000
101,943
275,548
Profit share
-
-
7,560
7,560
Drawings
-
-
(19,398)
(19,398)
At 31 March 2024
140,605
33,000
90,105
263,710
Carrying amount
At 31 March 2024
140,605
33,000
90,105
263,710
At 31 March 2023
140,605
33,000
101,943
275,548
12
Subsidiaries
Details of the company's subsidiaries at 31 March 2024 are as follows:
Name of undertaking
Registered office
Nature of business
Class of
% Held
shares held
Sentry Groundcare Limited
United Kingdom
Dormant company
Ordinary
100
Sentry Farms Limited
United Kingdom
Dormant company
Ordinary
100
Sentry Farming Limited
United Kingdom
Dormant company
Ordinary
100
13
Associates
Details of the company's associates at 31 March 2024 are as follows:
Name of undertaking
Registered office
Nature of business
Class of
% Held
shares held
Eastern Seed Growers Ltd
United Kingdom
Retail sale of flowers, plants, seeds, fertilisers, pet animals and pet food in specialised stores
Ordinary
33
All of the above subsidiaries and associated companies have the same registered office of the Company as stated in note 1.
SENTRY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 28 -
14
Stocks
2024
2023
£
£
Raw materials and consumables
385,944
402,772
Growing crops
420,218
612,354
Finished goods and goods for resale
300,330
129,121
1,106,492
1,144,247
15
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
1,092,539
813,142
Other debtors
140,049
65,662
Prepayments and accrued income
1,789,664
2,427,830
3,022,252
3,306,634
2024
2023
Amounts falling due after more than one year:
£
£
Amounts owed by undertakings in which the company has a participating interest
224,895
239,250
Deferred tax asset (note 20)
457,984
399,481
682,879
638,731
Total debtors
3,705,131
3,945,365
£1,680 provision for doubtful debts (2023: £3,372) is included within trade debtors.
16
Loans and overdrafts
2024
2023
£
£
Bank loans
21,313
81,744
Payable within one year
21,313
58,649
Payable after one year
23,095
The bank loans are secured by a debenture.
SENTRY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 29 -
17
Finance lease obligations
2024
2023
Future minimum lease payments due under finance leases:
£
£
Within one year
352,352
385,235
In two to five years
559,484
415,204
911,836
800,439
Hire purchase and finance lease agreements are secured on the assets concerned.
18
Creditors: amounts falling due within one year
2024
2023
Notes
£
£
Bank loans
16
21,313
58,649
Obligations under finance leases
17
352,352
385,234
Trade creditors
1,047,956
1,911,413
Corporation tax
11,355
Other taxation and social security
251,803
237,443
Accruals and deferred income
417,996
548,224
2,091,420
3,152,318
Hire purchase and finance lease agreements are secured on the assets concerned.
Bank loans are secured by a debenture.
19
Creditors: amounts falling due after more than one year
2024
2023
Notes
£
£
Bank loans and overdrafts
16
23,095
Obligations under finance leases
17
559,484
415,205
Amounts owed to group undertakings
140,700
140,700
700,184
579,000
Hire purchase and finance lease agreements are secured on the assets concerned.
Bank loans are unsecured.
SENTRY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 30 -
20
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Assets
Assets
2024
2023
Balances:
£
£
Accelerated capital allowances
(407,961)
(261,036)
Tax losses
358,861
132,869
Retirement benefit obligations
519,750
541,000
Other timing differences
(12,666)
(13,352)
457,984
399,481
2024
Movements in the year:
£
Asset at 1 April 2023
(399,481)
Charge to profit or loss
146,926
Charge to other comprehensive income
20,564
Credit to equity
(225,993)
Asset at 31 March 2024
(457,984)
The deferred tax asset set out above is expected to reverse within 12 months and relates to the utilisation of tax losses against future expected profits of the same period.
21
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
123,815
96,237
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.
SENTRY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
21
Retirement benefit schemes
(Continued)
- 31 -
Defined benefit schemes
The Company contributes to a defined benefit scheme in the UK, the Sentry Farms Pension Scheme. The assets of the scheme are held separately from those of the Company. The scheme is a Career Average Revalued Earning defined benefit pension scheme. Pension benefits are built up each year, linked to the members salaries in that year. The benefits are then increased each year in line with inflation. Some members who joined the scheme prior to 1 July 2006 also have final salary defined benefits for service accrued up to 31 October 2007 which are linked to the members' final pensionable salary at their date of leaving.
The scheme closed to future accrual on 31 December 2009 and all accrued pension benefits at the date of closure are increased each year in line with inflation.
Following completion of the 31 December 2021 triennial valuation carried out by First Actuarial plc, it was agreed that the Company would continue to pay £186,000 pa in monthly installments until 30 September 2029. Following the formal agreement of the increase in contributions, the Company would begin to pay £186,000 pa in monthly installments from 1 January 2023. The contribution level is expected to remain at this level for six years and nine months.
On 26 October 2018, the High Court issued a judgement involving the Lloyds Banking Group defined benefit pension schemes. The judgement concluded that the schemes should equalise pension benefits for men and women in relation to guaranteed minimum pension ('GMP') benefits. In addition, a ruling by the High Court, issued on 20 November 2020, means the Trustees of defined benefit schemes must also now revisit and equalise GMP for historic transfers where they were not equalised. These judgements have implications for many defined benefit schemes, including the Sentry Limited defined benefit pension scheme.
Based on advice from the Company's actuarial advisors, the balance recognised in the year to 30 April 2019 reflected their best estimate of the effect on the Company's reported pension liabilities and it is not considered the more recent 2020 case would materially impact this figure.
The cumulative amount of actuarial gains and losses recognised in the Statement of Comprehensive Income was £56,000 (2023 - £1,848,000).
2024
2023
Key assumptions
%
%
Discount rate
4.85
4.70
RPI inflation
3.20
3.20
CPI inflation
2.85
2.80
Mortality assumptions
2024
2023
Assumed life expectations on retirement at age 65:
Years
Years
Aged 65 now
- Males
21.3
22.0
- Females
23.7
24.4
Aged 45 now
- Males
22.6
23.3
- Females
25.2
25.8
SENTRY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
21
Retirement benefit schemes
(Continued)
- 32 -
2024
2023
Amounts recognised in the profit and loss account
£
£
Current service cost
85,000
321,000
Net interest on net defined benefit liability/(asset)
354,000
257,000
Other costs and income
(257,000)
(191,000)
Total costs
97,000
387,000
2024
2023
Amounts taken to other comprehensive income
£
£
Actuarial (gains)/losses
(56,000)
(1,848,000)
The amounts included in the balance sheet arising from the company's obligations in respect of defined benefit plans are as follows:
2024
2023
£
£
Present value of defined benefit obligations
7,626,000
7,752,000
Fair value of plan assets
(5,547,000)
(5,588,000)
Deficit in scheme
2,079,000
2,164,000
2024
Movements in the present value of defined benefit obligations
£
Liabilities at 1 April 2023
7,752,000
Benefits paid
(424,000)
Interest cost
354,000
Actuarial (gains)/losses
(56,000)
At 31 March 2024
7,626,000
The defined benefit obligations arise from plans which are wholly or partly funded.
2024
Movements in the fair value of plan assets
£
Fair value of assets at 1 April 2023
5,588,000
Return on assets excluding interest income
(60,000)
Benefits paid
(424,000)
Contributions
186,000
Interest cost
257,000
At 31 March 2024
5,547,000
SENTRY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
21
Retirement benefit schemes
(Continued)
- 33 -
The actual return on plan assets was (£60,000) (2023 - (£1,590,000)).
2024
2023
Fair value of plan assets at the reporting period end
£
£
Investments (Baillie Gifford)
2,485,000
2,371,000
Investments (M&G)
237,000
387,000
Investments (Legal & General)
2,339,000
2,375,000
Investments (Lindsell Train)
425,000
420,000
Cash
61,000
35,000
5,547,000
5,588,000
22
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
'A' ordinary shares of 25p each
371,600
371,600
92,900
92,900
'B' ordinary shares of 25p each
502,500
502,500
125,625
125,625
874,100
874,100
218,525
218,525
All shares rank pari passu.
23
Reserves
Share premium
The share premium account represents the fair value of shares acquired less the nominal value of the shares. Any transaction costs associated with the issuing of shares are deducted from the share premium.
Capital redemption reserve
The capital redemption reserve represents the nominal value of own shares purchased. Any transaction costs associated with the purchase of own shares are deducted from the capital redemption reserve.
Profit and loss reserves
The profit and loss account represents the Company's accumulated profits which are available for distribution to members.
24
Financial commitments, guarantees and contingent liabilities
The Company is a partner of Frinton Farm Partners, Great Holland Hall, Church Lane, Frinton-on-Sea, Essex and is jointly and severally liable with the other partners for the liability of the partnership. There are no contingent liabilities at the year end (2023 - £NIL).
SENTRY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 34 -
25
Related party transactions
At the year end £232,072 (2023: £239,250) a secured loan to Eastern Seed Growers Ltd, an associated company, remained outstanding and has been included within other debtors within Note 15. Interest is charged at 7% per annum. The first repayment was paid on 31 March 2024 and will be fully repaid on 31 March 2036.
During the year sales of £77,328 (2023: £84,937) and purchases of £12,681 (2023: £50,316) were made to associated companies. At the year end there was a total trade debtor balance of £Nil (2023: £Nil) and trade creditor balance of £344 (2023: £Nil) with these companies.
During the year sales of £127,292 (2023: £271,498) and purchases of £1,135 (2023: £895) were made to companies under significant control of a director of Sentry Limited.
26
Ultimate controlling party
There is no one controlling party.
27
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:
2024
2023
£
£
Within one year
1,110,043
968,217
Between two and five years
1,574,500
1,434,933
2,684,543
2,403,150
28
Analysis of changes in net funds/(debt)
1 April 2023
Cash flows
31 March 2024
£
£
£
Cash at bank and in hand
1,781,795
(1,018,761)
763,034
Borrowings excluding overdrafts
(81,744)
60,431
(21,313)
Obligations under finance leases
(800,439)
(111,397)
(911,836)
899,612
(1,069,727)
(170,115)
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