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Registration number: 08516137

Prepared for the registrar

Mercer Machinery Limited

Unaudited Financial Statements

for the Year Ended 31 January 2024

 

Mercer Machinery Limited

Contents

Company Information

1

Accountants' Report

2

Balance Sheet

3 to 4

Notes to the Unaudited Financial Statements

5 to 11

 

Mercer Machinery Limited

Company Information

Directors

J M Mercer

S Mercer

C Mercer

Company secretary

S Mercer

Registered office

Unit 2
Bowley Court Farm
Hope-Under-Dinmore
Leominster
Herefordshire
HR6 0PL

Accountants

Hazlewoods LLP
Chartered Accountants
Staverton Court
Staverton
Cheltenham
GL51 0UX

 

Chartered Accountants' Report to the Board of Directors on the Preparation of the Unaudited Statutory Accounts of Mercer Machinery Limited
for the Year Ended 31 January 2024
 

In order to assist you to fulfil your duties under the Companies Act 2006, we have prepared for your approval the accounts of Mercer Machinery Limited for the year ended 31 January 2024 as set out on pages 3 to 11 from the company's accounting records and from information and explanations you have given us.

As a practising member firm of the Institute of Chartered Accountants in England and Wales (ICAEW), we are subject to its ethical and other professional requirements which are detailed at
http://www.icaew.com/regulation.

This report is made solely to the Board of Directors of Mercer Machinery Limited, as a body, in accordance with the terms of our engagement letter. Our work has been undertaken solely to prepare for your approval the accounts of Mercer Machinery Limited and state those matters that we have agreed to state to the Board of Directors of Mercer Machinery Limited, as a body, in this report in accordance with ICAEW Technical Release 07/16 AAF. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than Mercer Machinery Limited and its Board of Directors as a body for our work or for this report.

It is your duty to ensure that Mercer Machinery Limited has kept adequate accounting records and to prepare statutory accounts that give a true and fair view of the assets, liabilities, financial position and profit of Mercer Machinery Limited. You consider that Mercer Machinery Limited is exempt from the statutory audit requirement for the year.

We have not been instructed to carry out an audit or a review of the accounts of Mercer Machinery Limited. For this reason, we have not verified the accuracy or completeness of the accounting records or information and explanations you have given to us and we do not, therefore, express any opinion on the statutory accounts.

......................................
Hazlewoods LLP
Chartered Accountants
Staverton Court
Staverton
Cheltenham
GL51 0UX

17 October 2024

 

Mercer Machinery Limited

(Registration number: 08516137)
Balance Sheet as at 31 January 2024

Note

2024
£

2023
£

Fixed assets

 

Tangible assets

4

118,296

134,795

Current assets

 

Stocks

600,000

450,000

Debtors

5

716,790

1,110,825

Cash at bank and in hand

 

416,794

153,134

 

1,733,584

1,713,959

Creditors: Amounts falling due within one year

6

(957,755)

(1,240,368)

Net current assets

 

775,829

473,591

Total assets less current liabilities

 

894,125

608,386

Deferred tax liabilities

 

(14,012)

(16,066)

Net assets

 

880,113

592,320

Capital and reserves

 

Called up share capital

1

1

Capital redemption reserve

600,000

400,000

Profit and loss account

280,112

192,319

Shareholders' funds

 

880,113

592,320

 

Mercer Machinery Limited

(Registration number: 08516137)
Balance Sheet as at 31 January 2024

For the financial year ending 31 January 2024 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.

Directors' responsibilities:

The members have not required the company to obtain an audit of its accounts for the year in question in accordance with section 476; and

The directors acknowledge their responsibilities for complying with the requirements of the Act with respect to accounting records and the preparation of accounts.

These financial statements have been prepared in accordance with the special provisions relating to companies subject to the small companies regime within Part 15 of the Companies Act 2006.

These financial statements have been delivered in accordance with the provisions applicable to companies subject to the small companies regime and the option not to file the Profit and Loss Account has been taken.

Approved and authorised by the Board on 17 October 2024 and signed on its behalf by:
 


J M Mercer
Director


S Mercer
Company secretary and director


C Mercer
Director

 

Mercer Machinery Limited

Notes to the Unaudited Financial Statements for the Year Ended 31 January 2024

 

1

General information

The company is a private company limited by share capital, incorporated in England and Wales.

The address of its registered office is:
Unit 2
Bowley Court Farm
Hope-Under-Dinmore
Leominster
Herefordshire
HR6 0PL

 

2

Accounting policies

Summary of significant accounting policies and key accounting estimates

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

Statement of compliance

These financial statements have been prepared in accordance with Financial Reporting Standard 102 Section 1A smaller entities - 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland' and the Companies Act 2006 (as applicable to companies subject to the small companies' regime).

Basis of preparation

These financial statements have been prepared using the historical cost convention except for, where disclosed in these accounting policies, certain items that are shown at fair value.

The presentational currency of the financial statements is Pounds Sterling, being the functional currency of the primary economic environment in which the company operates. Monetary amounts in these financial statements are rounded to the nearest Pound.

Going concern

After reviewing the company's forecasts and projections, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. The company therefore continues to adopt the going concern basis in preparing its financial statements.

Critical accounting 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 amounts 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 if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
 

Judgements

No significant judgements have been made by management in preparing these financial statements.

 

Mercer Machinery Limited

Notes to the Unaudited Financial Statements for the Year Ended 31 January 2024

Key sources of estimation uncertainty

No key sources of estimation uncertainty have been identified by management in preparing these financial statements other than those detailed in these accounting policies.

Revenue recognition

Turnover comprises the fair value of the consideration received or receivable for the sale of goods and provision of services in the ordinary course of the company’s activities. Turnover is shown net of sales/value added tax, returns, rebates and discounts and after eliminating sales within the company.

The company recognises revenue when:
The amount of revenue can be reliably measured;
it is probable that future economic benefits will flow to the entity;
and specific criteria have been met for each of the company's activities.

Foreign currency transactions and balances

Transactions in foreign currencies are initially recorded at the functional currency rate prevailing at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated into the respective functional currency of the entity at the rates prevailing on the reporting period date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing on the initial transaction dates.

Non-monetary items measured in terms of historical cost in a foreign currency are not retranslated.

Tax

The tax expense for the period comprises current and deferred tax. Tax is recognised in the profit and loss account, except that a charge attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the company operates and generates taxable income.

Deferred income tax is recognised on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements and on unused tax losses or tax credits in the company. Deferred income tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.

The carrying amount of deferred tax assets are reviewed at each reporting date and a valuation allowance is set up against deferred tax assets so that the net carrying amount equals the highest amount that is more likely than not to be recovered based on current or future taxable profit.

Tangible assets

Tangible assets are stated in the statement of financial position at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.

The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.

Depreciation

Depreciation is charged so as to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:

Asset class

Depreciation method and rate

Fixtures and fittings

15% reducing balance

Motor vehicles

22.5% / 25% reducing balance

Plant and equipment

10% / 15% reducing balance

Goodwill

Goodwill is amortised over its useful life, which shall not exceed five years if a reliable estimate of the useful life cannot be made.

 

Mercer Machinery Limited

Notes to the Unaudited Financial Statements for the Year Ended 31 January 2024

Intangible assets

Goodwill arising on the acquisition of an entity represents the excess of the cost of acquisition over the company’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the entity recognised at the date of acquisition. Goodwill is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is held in the currency of the acquired entity and revalued to the closing rate at each reporting period date.

Amortisation

Amortisation is provided on intangible assets so as to write off the cost, less any estimated residual value, over their useful life as follows:

Asset class

Amortisation method and rate

Goodwill

10 years straight line

Trade debtors

Trade debtors are amounts due from customers for merchandise sold or services performed in the ordinary course of business.

Trade debtors are recognised initially at the transaction price. All trade debtors are repayable within one year and hence are included at the undiscounted cost of cash expected to be received. A provision for the impairment of trade debtors is established when there is objective evidence that the company will not be able to collect all amounts due according to the original terms of the debtors.

Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost is determined using the first-in, first-out (FIFO) method.

The cost of finished goods and work in progress comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the inventories to their present location and condition. At each reporting date, stocks are assessed for impairment. If stocks are impaired, the carrying amount is reduced to its selling price less costs to complete and sell; the impairment loss is recognised immediately in profit or loss.

Trade creditors

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the company does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.

Trade creditors are recognised initially at the transaction price and all are repayable within one year and hence are included at the undiscounted amount of cash expected to be paid.

Borrowings

Interest-bearing borrowings are initially recorded at fair value, net of transaction costs. Interest-bearing borrowings are subsequently carried at amortised cost, with the difference between the proceeds, net of transaction costs, and the amount due on redemption being recognised as a charge to the profit and loss account over the period of the relevant borrowing.

Interest expense is recognised on the basis of the effective interest method and is included in interest payable and similar charges.

Borrowings are classified as current liabilities unless the company has an unconditional right to defer settlement of the liability for at least twelve months after the reporting date.

 

Mercer Machinery Limited

Notes to the Unaudited Financial Statements for the Year Ended 31 January 2024

Financial instruments


Classification
Financial instruments are classified and accounted for according to the substance of the contractual arrangement, as financial assets, financial liabilities or equity instruments. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities. Where shares are issued, any component that creates a financial liability of the company is presented as a liability on the balance sheet. The corresponding dividends relating to the liability component are charged as interest expenses in the profit and loss account.

 Recognition and measurement
All financial assets and liabilities are initially measured at transaction price (including transaction costs), except for those financial assets classified as at fair value through profit or loss, which are initially measured at fair value (which is normally the transaction price excluding transaction costs), unless the arrangement constitutes a financing transaction. If an arrangement constitutes a financing transaction, the financial asset or financial liability is measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument.

 Impairment
Assets, other than those measured at fair value, are assessed for indicators of impairment at each balance sheet date. If there is objective evidence of impairment, an impairment loss is recognised in profit or loss as described below.

A non financial asset is impaired where there is objective evidence that, as a result of one or more events that occurred after initial recognition, the estimated recoverable value of the asset has been reduced. The recoverable amount of an asset is the higher of its fair value less costs to sell and its value in use.

The recoverable amount of goodwill is derived from measurement of the present value of the future cash flows of the cash-generating units ('CGUs') of which the goodwill is a part. Any impairment loss in respect of a CGU is allocated first to the goodwill attached to that CGU, and then to other assets within that CGU on a pro-rata basis.

Where indicators exist for a decrease in impairment loss, the prior impairment loss is tested to determine reversal. An impairment loss is reversed on an individual impaired asset to the extent that the revised recoverable value does not lead to a revised carrying amount higher than the carrying value had no impairment been recognised. Where a reversal of impairment occurs in respect of a CGU, the reversal is applied first to the assets (other than goodwill) of the CGU on a pro-rata basis and then to any goodwill allocated to that CGU.

For financial assets carried at amortised cost, the amount of an impairment is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the financial asset’s original effective interest rate.

For financial assets carried at cost less impairment, the impairment loss is the difference between the asset’s carrying amount and the best estimate of the amount that would be received for the asset if it were to be sold at the reporting date.

Where indicators exist for a decrease in impairment loss, and the decrease can be related objectively to an event occurring after the impairment was recognised, the prior impairment loss is tested to determine reversal. An impairment loss is reversed on an individual impaired financial asset to the extent that the revised recoverable value does not lead to a revised carrying amount higher than the carrying value had no impairment been recognised.

Leases

Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease.

Share capital

Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.

 

Mercer Machinery Limited

Notes to the Unaudited Financial Statements for the Year Ended 31 January 2024

 

3

Staff numbers

The average number of persons employed by the company (including directors) during the year, was 5 (2023 - 7).

 

4

Tangible assets

Fixtures and fittings
 £

Motor vehicles
 £

Plant and equipment
 £

Total
£

Cost

At 1 February 2023

17,445

67,591

234,928

319,964

Disposals

-

(8,405)

-

(8,405)

At 31 January 2024

17,445

59,186

234,928

311,559

Depreciation

At 1 February 2023

11,363

56,607

117,199

185,169

Charge for the year

913

2,604

12,417

15,934

Eliminated on disposal

-

(7,840)

-

(7,840)

At 31 January 2024

12,276

51,371

129,616

193,263

Carrying amount

At 31 January 2024

5,169

7,815

105,312

118,296

At 31 January 2023

6,083

10,984

117,728

134,795

 

Mercer Machinery Limited

Notes to the Unaudited Financial Statements for the Year Ended 31 January 2024

 

5

Debtors

Note

2024
 £

2023
 £

Trade debtors

 

93,004

638,978

Amounts owed by related parties

9

618,567

468,567

Prepayments

 

5,219

3,280

   

716,790

1,110,825

 

Mercer Machinery Limited

Notes to the Unaudited Financial Statements for the Year Ended 31 January 2024

 

6

Creditors

Note

2024
 £

2023
 £

Due within one year

 

Loans and borrowings

8

800,000

1,000,000

Trade creditors

 

59,648

107,901

VAT control account

 

1,276

71,157

Accrued expenses

 

3,850

3,850

Corporation tax liability

92,981

57,460

 

957,755

1,240,368

 

7

Deferred tax

Deferred tax assets and liabilities

2024

Liability
£

Fixed asset timing difference

14,012

14,012

2023

Liability
£

Fixed asset timing difference

16,066

16,066

 

8

Loans and borrowings

2024
£

2023
£

Current loans and borrowings

Redeemable preference shares

800,000

1,000,000

Redeemable preference shares

The 1% redeemable preference shares are redeemable at the option of the shareholder or the company upon three months of written notice. They are redeemable at £1 per share, carry no voting rights and have no rights to any further participation in a distribution of assets upon winding up. They are non cumulative.

 

9

Related party transactions


Transactions with directors
At the balance sheet date the amount due to directors was £nil (2023 - £nil).

Transactions with other related companies
At the balance sheet date the amount due from related companies was £618,567 (2023 - £468,567).