REGISTERED NUMBER: |
Strategic Report, Report of the Directors and |
Financial Statements for the Year Ended 29 February 2024 |
for |
Shortbread House of Edinburgh Limited |
REGISTERED NUMBER: |
Strategic Report, Report of the Directors and |
Financial Statements for the Year Ended 29 February 2024 |
for |
Shortbread House of Edinburgh Limited |
Shortbread House of Edinburgh Limited (Registered number: SC115377) |
Contents of the Financial Statements |
for the Year Ended 29 February 2024 |
Page |
Company Information | 1 |
Strategic Report | 2 |
Report of the Directors | 4 |
Report of the Independent Auditors | 6 |
Income Statement | 10 |
Other Comprehensive Income | 11 |
Statement of Financial Position | 12 |
Statement of Changes in Equity | 13 |
Statement of Cash Flows | 14 |
Notes to the Statement of Cash Flows | 15 |
Notes to the Financial Statements | 16 |
Shortbread House of Edinburgh Limited |
Company Information |
for the Year Ended 29 February 2024 |
DIRECTORS: |
SECRETARY: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
SENIOR STATUTORY AUDITOR: |
AUDITORS: |
47-49 The Square |
Kelso |
Roxburghshire |
TD5 7HW |
Shortbread House of Edinburgh Limited (Registered number: SC115377) |
Strategic Report |
for the Year Ended 29 February 2024 |
The directors present their strategic report for the year ended 29 February 2024. |
Since Shortbread House of Edinburgh Ltd started trading as a limited company in 1994, the focus has always been on producing high quality products to be sold in premium retail outlets at home and abroad. The directors have always resisted opportunities to grow turnover at the expense of this pursuit of excellence. There is no current intention to compromise this objective. |
REVIEW OF BUSINESS |
Turnover for the year ended 29th February 2024 was £6.87m (2023: £5.81m) The gross profit margin reduced to 38% (2023: 40%) due principally to increases in raw material costs and wages. Net profit before tax was similar to the previous year: £1.42m (2023: £1.45m). The company maintains a strong balance sheet with net assets continuing to increase significantly. |
The interests and well-being of our employees are always of prime importance in the development of our strategy. |
We have developed strong relationships with our suppliers, customers and other key stakeholders. As regards suppliers, we pride ourselves on paying promptly. |
The company's operation in the community and environment is a prime concern of the directors. As a key employer in the locality, we are very conscious of our impact on the area and the opportunity for the company to be of benefit in the neighbourhood. We strive to reduce our carbon footprint through improving efficiency and investigating new ways to achieve reduced energy usage. |
We maintain the highest standards of hygiene in our premises and undergo British Retail Consortium inspections annually. To date, the company has always performed exceptionally well in these inspections. |
The company does everything possible to maintain its reputation for high standards of business conduct which is also reflected in the high quality reputation of its products. |
The company continued to take a long-term view of the business by investing in a significant expansion of their manufacturing premises in Leith, with associated new plant and equipment. In response to growing demand for their products, this expansion and capital investment is expected to continue into 2026. |
Key performance indicators are: |
2024 |
2023 |
Gross profit percentage | 38.3% | 39.6% |
Net profit/(loss) percentage | 20.7% | 25.0% |
Gearing | - % | - % |
Liquidity (current assets: current liabilities) | 316.9% | 441.5% |
Future developments |
The company continues to build market share, both through the expanding business of its core customers and the development of new products and packaging under their own brand. |
Promoting the success of the company |
The directors attend regular meetings to review the strategy, performance and responsibilities of the company. Decisions are taken in a way which they consider is most likely to promote the success of the company for the long term benefit of all its members, including employees. |
Shortbread House of Edinburgh Limited (Registered number: SC115377) |
Strategic Report |
for the Year Ended 29 February 2024 |
PRINCIPAL RISKS AND UNCERTAINTIES |
The fragile situation in the Middle East and elsewhere poses a threat, particularly to the import of key packaging materials. The company's exposure to this will be mitigated to some extent by higher than normal stock levels being held in this country. |
Rising commodity and utility prices have already taken a significant toll on the company's performance and may continue to do so. These are managed as effectively as possible. |
Fluctuations in currency exchange rates are managed through the holding of appropriate levels of US dollars and other currencies. |
The responsibility for managing financial risk, both in terms of the levels of cash deposits held and the control of trade debtors, is undertaken by the directors through the close and careful monitoring of these risks. A good level of liquidity is a key priority to ensure adequate working capital at all times. |
ON BEHALF OF THE BOARD: |
15 October 2024 |
Shortbread House of Edinburgh Limited (Registered number: SC115377) |
Report of the Directors |
for the Year Ended 29 February 2024 |
The directors present their report with the financial statements of the company for the year ended 29 February 2024. |
PRINCIPAL ACTIVITY |
The principal activity of the company in the year under review was that of manufacturing bakery products. |
DIVIDENDS |
Interim dividends per share were paid during the year as follows: |
Ordinary C £1 | £1.8111 per share |
Ordinary D £1 | £1.4887 per share |
The total distribution of dividends for the year ended 29 February 2024 was £66,500 |
EVENTS SINCE THE END OF THE YEAR |
Information relating to events since the end of the year is given in the notes to the financial statements. |
DIRECTORS |
The directors shown below have held office during the whole of the period from 1 March 2023 to the date of this report. |
CHARITABLE DONATIONS AND EXPENDITURE |
Charitable donations of £6,051 (2023 - £6,500) where made by the company during the year. |
STATEMENT OF DIRECTORS' RESPONSIBILITIES |
The directors are responsible for preparing the Strategic Report, the Report of the Directors 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), including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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. |
Shortbread House of Edinburgh Limited (Registered number: SC115377) |
Report of the Directors |
for the Year Ended 29 February 2024 |
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS |
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the company's auditors are aware of that information. |
ON BEHALF OF THE BOARD: |
Report of the Independent Auditors to the Members of |
Shortbread House of Edinburgh Limited |
Opinion |
We have audited the financial statements of Shortbread House of Edinburgh Limited (the 'company') for the year ended 29 February 2024 which comprise the Income Statement, Other Comprehensive Income, Statement of Financial Position, Statement of Changes in Equity, Statement of Cash Flows and Notes to the Statement of Cash Flows, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice). |
_ |
In our opinion the financial statements: |
- | give a true and fair view of the state of the company's affairs as at 29 February 2024 and of its profit for the year then ended; |
- | have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and |
- | have been prepared in accordance with the requirements of the Companies Act 2006. |
Basis for opinion |
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' 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. Our evaluation of the directors' assessment of the company's ability to continue to adopt the going concern basis of accounting included reviewing the assumptions used by management in their assessment, considering the effects of alternative outcomes and, considering the company's strong liquid asset position, assessing the company's ability to meet its commitments as they fall due. |
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. |
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report. |
Other information |
The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon. |
Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. |
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether 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. |
We have nothing to report in this regard. |
Opinions on other matters prescribed by the Companies Act 2006 |
In our opinion, based on the work undertaken in the course of the audit: |
- | the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements. |
Report of the Independent Auditors to the Members of |
Shortbread House of Edinburgh Limited |
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 Report of the Directors. |
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion: |
- | adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or |
- | the financial statements are not in agreement with the accounting records and returns; or |
- | certain disclosures of directors' remuneration specified by law are not made; or |
- | we have not received all the information and explanations we require for our audit. |
Responsibilities of directors |
As explained more fully in the Statement of Directors' Responsibilities set out on page four, 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 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. |
Report of the Independent Auditors to the Members of |
Shortbread House of Edinburgh Limited |
Auditors' 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 a Report of the Auditors 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. |
The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: |
The objectives of our audit are to obtain sufficient appropriate audit evidence regarding compliance with those laws and regulations deemed to have a direct effect on the determination of material amounts and disclosures in the financial statements, and to perform audit procedures to enable us to identify instances of non-compliance with other laws and regulations that may have a material effect on the financial statements, and to respond appropriately to any identified or suspected non-compliance with laws and regulations identified during the audit. |
In relation to fraud, the objectives of our audit are to identify and assess the risk of material misstatement of the financial statements due to fraud, to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement through the design and implementation of appropriate responses, and to respond appropriately to fraud or suspected fraud identified during the course of the audit. |
However, it is management's responsibility, with the oversight of those charged with governance, to ensure that the entity's operations are conducted in accordance with the provisions of laws and regulations and for the prevention and detection of fraud. |
In order to identify risks of material misstatement, and appropriately address these risks through the design of audit procedures, in respect of irregularities, including fraud, the audit engagement team: |
- | obtained an understanding of the nature of the industry and sector in which the entity operates, including the legal and regulatory framework applicable to the entity, and how the entity complies with those laws and regulations which have a direct effect on the financial statements; |
- | enquired of management, and those charged with governance, about their procedures to identify and assess risks, including any known or suspected instances of fraud or misappropriation of assets; |
- | enquired of management, and those charged with governance, about instances of non-compliance with laws and regulations, including how fraud might occur, and where the financial statements may be susceptible to fraud. |
As a result of these procedures, we consider the most significant laws and regulations which have a direct effect on the financial statements to be FRS 102, the Companies Act 2006 and tax compliance regulations. Regarding these laws and regulations deemed to have a direct effect on the financial statements, we designed and performed audit procedures to detect instances of non-compliance which may have a material impact on the financial statements. These procedures included a review of correspondence with HMRC, enquiries of management and professional advisors, a comprehensive review of policies and financial statement disclosures, and the completion of customised disclosure checklists. |
The most significant laws and regulations which have an indirect impact on the financial statements are health and safety regulations, food safety regulations, and employment law. Guided by the risk assessment procedures noted above, we discussed these laws and regulations with management, and those charged with governance, and assessed whether they were aware of any instances of non-compliance. To corroborate management's assertions, we inspected certification issued by local authorities and UK Food Certification in relation to food standards, reviewed board level communication, reviewed legal expense codes, and remained alert to indicators of non-compliance throughout the audit. |
The audit engagement team identified management override of internal controls, fraud in revenue recognition, and inventory valuation as being the areas that the financial statements were most susceptible to material misstatement due to fraud. In order to address the risk of material misstatement due to fraud, testing was performed over manual journal entries, with a focus on specific risk criteria, large and unusual transactions, and entries outside of the normal course of business. |
With regard to addressing the risk of material misstatement due to fraud in revenue recognition, the engagement team designed and performed procedures including, but not limited to, testing postings around the period end, assessing the sequencing of sales invoicing, and assessing journals with unusual mapping structures. We also reviewed all policies and disclosures for adherence to FRS 102. |
Report of the Independent Auditors to the Members of |
Shortbread House of Edinburgh Limited |
There are inherent limitations in the audit procedures detailed above, not least in that the more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Furthermore, material misstatements that arise due to fraud require intentional omissions, misrepresentations, or override of controls, and are characterised by a deliberate attempt to conceal the true nature of events. |
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors. |
Use of our 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 a Report of the Auditors 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. |
for and on behalf of |
47-49 The Square |
Kelso |
Roxburghshire |
TD5 7HW |
Shortbread House of Edinburgh Limited (Registered number: SC115377) |
Income Statement |
for the Year Ended 29 February 2024 |
29/2/24 | 28/2/23 |
(Unaudited) |
Notes | £ | £ |
REVENUE | 3 |
Cost of sales |
GROSS PROFIT |
Administrative expenses |
1,326,643 | 1,444,438 |
Other operating income |
OPERATING PROFIT |
Interest receivable and similar income |
PROFIT BEFORE TAXATION | 5 |
Tax on profit | 6 |
PROFIT FOR THE FINANCIAL YEAR |
Shortbread House of Edinburgh Limited (Registered number: SC115377) |
Other Comprehensive Income |
for the Year Ended 29 February 2024 |
29/2/24 | 28/2/23 |
(Unaudited) |
Notes | £ | £ |
PROFIT FOR THE YEAR |
OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE INCOME FOR THE YEAR |
Shortbread House of Edinburgh Limited (Registered number: SC115377) |
Statement of Financial Position |
29 February 2024 |
29/2/24 | 28/2/23 |
(Unaudited) |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Intangible assets | 8 |
Property, plant and equipment | 9 |
Investments | 10 |
CURRENT ASSETS |
Inventories | 11 |
Debtors | 12 |
Cash at bank and in hand |
CREDITORS |
Amounts falling due within one year | 13 |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
CREDITORS |
Amounts falling due after more than one year |
14 |
( |
) |
PROVISIONS FOR LIABILITIES | 15 | ( |
) | ( |
) |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 16 |
Share premium |
Retained earnings |
SHAREHOLDERS' FUNDS |
The financial statements were approved by the Board of Directors and authorised for issue on |
Shortbread House of Edinburgh Limited (Registered number: SC115377) |
Statement of Changes in Equity |
for the Year Ended 29 February 2024 |
Called up |
share | Retained | Share | Total |
capital | earnings | premium | equity |
£ | £ | £ | £ |
Balance at 1 March 2022 |
Changes in equity |
Dividends | - | ( |
) | - | ( |
) |
Total comprehensive income | - | - |
Balance at 28 February 2023 |
Changes in equity |
Dividends | - | ( |
) | - | ( |
) |
Total comprehensive income | - | - |
Balance at 29 February 2024 |
Shortbread House of Edinburgh Limited (Registered number: SC115377) |
Statement of Cash Flows |
for the Year Ended 29 February 2024 |
29/2/24 | 28/2/23 |
(Unaudited) |
Notes | £ | £ |
Cash flows from operating activities |
Cash generated from operations | 1 |
Tax paid | ( |
) | ( |
) |
Net cash from operating activities |
Cash flows from investing activities |
Purchase of tangible fixed assets | ( |
) | ( |
) |
Government grants received |
Interest received |
Net cash from investing activities | ( |
) | ( |
) |
Cash flows from financing activities |
Amount introduced by directors | - | 214,900 |
Amount withdrawn by directors | (198,500 | ) | - |
Equity dividends paid | ( |
) | ( |
) |
Net cash from financing activities | ( |
) | ( |
) |
Increase in cash and cash equivalents |
Cash and cash equivalents at beginning of year |
2 |
1,808,402 |
Cash and cash equivalents at end of year | 2 | 3,320,731 | 1,920,890 |
Shortbread House of Edinburgh Limited (Registered number: SC115377) |
Notes to the Statement of Cash Flows |
for the Year Ended 29 February 2024 |
1. | RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS |
29/2/24 | 28/2/23 |
(Unaudited) |
£ | £ |
Profit before taxation |
Depreciation charges |
Loss on disposal of fixed assets |
Government grants | ( |
) | ( |
) |
Finance income | (78,924 | ) | (4,352 | ) |
1,509,501 | 1,602,405 |
Decrease/(increase) in inventories | ( |
) |
Decrease/(increase) in trade and other debtors | ( |
) |
Increase in trade and other creditors |
Cash generated from operations |
2. | CASH AND CASH EQUIVALENTS |
The amounts disclosed on the Statement of Cash Flows in respect of cash and cash equivalents are in respect of these Statement of Financial Position amounts: |
Year ended 29 February 2024 |
29/2/24 | 1/3/23 |
£ | £ |
Cash and cash equivalents | 3,320,731 | 1,920,890 |
Year ended 28 February 2023 |
28/2/23 | 1/3/22 |
(Unaudited) |
£ | £ |
Cash and cash equivalents | 1,920,890 | 1,808,402 |
3. | ANALYSIS OF CHANGES IN NET FUNDS |
At 1/3/23 | Cash flow | At 29/2/24 |
£ | £ | £ |
Net cash |
Cash at bank and in hand | 1,920,890 | 1,399,841 | 3,320,731 |
1,920,890 | 3,320,731 |
Total | 1,920,890 | 1,399,841 | 3,320,731 |
Shortbread House of Edinburgh Limited (Registered number: SC115377) |
Notes to the Financial Statements |
for the Year Ended 29 February 2024 |
1. | STATUTORY INFORMATION |
Shortbread House of Edinburgh Limited is a private company, limited by shares, incorporated and domiciled in Scotland. The company number is SC115377 and the registered office is 25 Tennant Street, Edinburgh, EH6 5NA. |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
Income recognition |
Revenue is measured at the fair value of the consideration received or receivable, net of returns and discounts, rebates, value added tax and other sales taxes. |
Revenue is earned from the sale and delivery of goods to customers. It is recognised when the significant risks and rewards of ownership of the goods have transferred to the buyer, usually when goods leave the company's warehouse, the amount of revenue and any relevant transaction costs can be measured reliably and it is probable that the company will receive the consideration. |
Intangible assets - goodwill |
Goodwill represents the difference between the cost of an acquired business and the aggregate of the fair values of its identifiable assets and liabilities. Goodwill is capitalised and amortised through the profit and loss account on a straight line basis over its useful economic life of 1 to 4 years. |
Intangible assets - other |
Other intangible assets such as software, intellectual property and brands, where purchased, are recognised if it is probable that the expected future economic benefits can be attributed to the asset and the fair value of the asset can be reliably measured. After initial recognition at cost, intangible assets are amortised over their useful economic lives on a straight line basis. |
The company does not recognise internally generated intangible assets. |
Tangible fixed assets |
Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful |
life. |
Freehold property | - Straight line over 50 years |
Long leasehold | - Straight line over 50 years |
Leasehold improvements | - Straight line over 5 to 20 years |
Plant and machinery | - Straight line over 3 to 10 years |
Motor vehicles | - 25% on cost |
Computer equipment | - 33% on cost |
Tangible fixed assets are measured at cost less accumulated depreciation and any accumulated impairment |
losses. |
Shortbread House of Edinburgh Limited (Registered number: SC115377) |
Notes to the Financial Statements - continued |
for the Year Ended 29 February 2024 |
2. | ACCOUNTING POLICIES - continued |
Impairment of fixed assets |
At each reporting date, the carrying values of goodwill, other intangible and tangible fixed assets are reviewed to determine whether there is any indication that those assets have suffered an impairment. If any such indicators exist, the recoverable amount of that asset is estimated. If the carrying value exceeds the estimated recoverable amount, an impairment loss is recognised in the profit and loss account. Prior impairments are also reviewed for possible reversal at each reporting date. |
For the purposes of impairment testing, 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. The cash-generating unit is the smallest identifiable group of assets that includes the asset, and generates cash inflows that are largely independent of the cash inflows from other assets or group of assets. |
Government grants |
Government grants are recognised at the fair value of the assets received or receivable when there is reasonable assurance that the grant conditions will be met and the grant received. |
Government grants in relation to tangible fixed assets are credited to profit and loss account over the useful economic life of the related asset. Grants in relation to expenditure are credited when the expenditure is charged to profit and loss. |
Inventories |
Finished goods values are comprised of direct materials costs, direct labour costs and an appropriate allocation of overheads. |
Financial instruments |
A financial asset or a financial liability is recognised only when the company becomes a party to the contractual provisions of the instrument. |
Financial assets |
Basic financial assets include trade and other debtors, prepayments and accrued income, and cash and bank balances. These are initially measured at transaction price and are subsequently measured at amortised cost using the effective interest rate method, if applicable, and are assessed for impairment at the end of each reporting date. Financing transactions are recognised at the present value of future payments discounted at a market rate of interest. |
Financial liabilities: |
Basic financial liabilities include trade and other creditors, and accruals and deferred income. These are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument will be measured at the present value of future payments discounted at a market rate of interest. Any debt instrument would then subsequently be held at amortised cost, using the effective interest rate method. |
For all equity instruments regardless of significance, and other financial assets that are individually significant, these are assessed individually for impairment. Other financial assets are either assessed individually or grouped on the basis of similar credit risk characteristics. |
Any reversals of impairment are recognised in profit or loss immediately, to the extent that the reversal does not result in a carrying amount of the financial asset that exceeds what the carrying amount would have been had the impairment not previously been recognised. |
Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. |
Current or deferred taxation assets and liabilities are not discounted. |
Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the statement of financial position date. |
Shortbread House of Edinburgh Limited (Registered number: SC115377) |
Notes to the Financial Statements - continued |
for the Year Ended 29 February 2024 |
2. | ACCOUNTING POLICIES - continued |
Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position date. |
Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference. |
Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
Foreign currencies |
Foreign currency transactions are initially recorded in the functional currency, which is sterling, at an average rate for the month. Monetary assets and liabilities denominated in foreign currencies are translated in sterling at the exchange rate ruling at the statement of financial position date, with any gains or losses being charged to the profit and loss account. |
Leases |
Rentals payable under the property lease at 33 Tennant Street are charged to the profit and loss account on a straight line basis over the period of the lease. |
Pension costs and other post-retirement benefits |
The Company operates two defined contribution pension schemes. The assets of the schemes are held separately from those of the company in independently administered funds. Contributions payable to the Company's pension schemes are charged to the profit and loss account in the period to which they relate. |
Going concern |
The directors have considered the company's financial position for a period of 12 months from the date of signing these financial statements and have reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing these financial statements. |
3. | REVENUE |
The revenue and profit before taxation are attributable to the one principal activity of the company. |
An analysis of revenue by geographical market is given below: |
29/2/24 | 28/2/23 |
(Unaudited) |
£ | £ |
United Kingdom |
Europe |
Asia |
North America | 347,339 | 387,910 |
Rest of world | 26,139 | 65,675 |
Shortbread House of Edinburgh Limited (Registered number: SC115377) |
Notes to the Financial Statements - continued |
for the Year Ended 29 February 2024 |
4. | EMPLOYEES AND DIRECTORS |
29/2/24 | 28/2/23 |
(Unaudited) |
£ | £ |
Wages and salaries |
Social security costs |
Other pension costs |
The average number of employees during the year was as follows: |
29/2/24 | 28/2/23 |
(Unaudited) |
Administration | 8 | 7 |
Manufacturing | 60 | 48 |
29/2/24 | 28/2/23 |
(Unaudited) |
£ | £ |
Directors' remuneration |
Directors' pension contributions to money purchase schemes |
The number of directors to whom retirement benefits were accruing was as follows: |
Money purchase schemes |
5. | PROFIT BEFORE TAXATION |
The profit is stated after charging/(crediting): |
29/2/24 | 28/2/23 |
(Unaudited) |
£ | £ |
Other operating leases |
Depreciation - owned assets |
Loss on disposal of fixed assets |
Auditors' remuneration |
Other non- audit services |
Foreign exchange differences | ( |
) |
Shortbread House of Edinburgh Limited (Registered number: SC115377) |
Notes to the Financial Statements - continued |
for the Year Ended 29 February 2024 |
6. | TAXATION |
Analysis of the tax charge |
The tax charge on the profit for the year was as follows: |
29/2/24 | 28/2/23 |
(Unaudited) |
£ | £ |
Current tax: |
UK corporation tax |
Deferred tax |
Tax on profit |
Reconciliation of total tax charge included in profit and loss |
The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below: |
29/2/24 | 28/2/23 |
(Unaudited) |
£ | £ |
Profit before tax |
Profit multiplied by the standard rate of corporation tax in the UK of |
Effects of: |
Expenses not deductible for tax purposes | ( |
) |
Income not taxable for tax purposes | ( |
) |
Capital allowances in excess of depreciation | ( |
) | ( |
) |
Adjustments to tax charge in respect of previous periods |
Other adjustments | - | (7,794 | ) |
Deferred tax | 50,000 | 43,000 |
Total tax charge | 353,608 | 287,527 |
7. | DIVIDENDS |
29/2/24 | 28/2/23 |
(Unaudited) |
£ | £ |
Ordinary A shares of £1 each |
Interim dividend A shares |
Ordinary B shares of £1 each |
Interim dividend B shares |
Ordinary C shares of £1 each |
Interim dividend C shares |
Ordinary D shares of £1 each |
Interim dividend D shares |
Shortbread House of Edinburgh Limited (Registered number: SC115377) |
Notes to the Financial Statements - continued |
for the Year Ended 29 February 2024 |
8. | INTANGIBLE FIXED ASSETS |
Goodwill |
£ |
COST |
At 1 March 2023 |
and 29 February 2024 |
AMORTISATION |
At 1 March 2023 |
and 29 February 2024 |
NET BOOK VALUE |
At 29 February 2024 |
At 28 February 2023 |
9. | PROPERTY, PLANT AND EQUIPMENT |
Freehold | Long | Leasehold |
property | leasehold | improvements |
£ | £ | £ |
COST |
At 1 March 2023 |
Additions |
Disposals | ( |
) |
At 29 February 2024 |
DEPRECIATION |
At 1 March 2023 |
Charge for year |
Eliminated on disposal | ( |
) |
At 29 February 2024 |
NET BOOK VALUE |
At 29 February 2024 |
At 28 February 2023 |
Shortbread House of Edinburgh Limited (Registered number: SC115377) |
Notes to the Financial Statements - continued |
for the Year Ended 29 February 2024 |
9. | PROPERTY, PLANT AND EQUIPMENT - continued |
Plant and | Motor | Computer |
machinery | vehicles | equipment | Totals |
£ | £ | £ | £ |
COST |
At 1 March 2023 |
Additions |
Disposals | ( |
) | ( |
) | ( |
) |
At 29 February 2024 |
DEPRECIATION |
At 1 March 2023 |
Charge for year |
Eliminated on disposal | ( |
) | ( |
) | ( |
) |
At 29 February 2024 |
NET BOOK VALUE |
At 29 February 2024 |
At 28 February 2023 |
Included in cost of land and buildings is freehold land of £ 1,000,000 (2023 - £ 1,000,000 ) which is not depreciated. |
10. | FIXED ASSET INVESTMENTS |
Unlisted |
investments |
£ |
COST |
At 1 March 2023 |
and 29 February 2024 |
NET BOOK VALUE |
At 29 February 2024 |
At 28 February 2023 |
11. | INVENTORIES |
29/2/24 | 28/2/23 |
(Unaudited) |
£ | £ |
Raw materials and packaging |
Finished goods |
Shortbread House of Edinburgh Limited (Registered number: SC115377) |
Notes to the Financial Statements - continued |
for the Year Ended 29 February 2024 |
12. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
29/2/24 | 28/2/23 |
(Unaudited) |
£ | £ |
Trade debtors |
Other debtors |
VAT |
Prepayments and accrued income |
13. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
29/2/24 | 28/2/23 |
(Unaudited) |
£ | £ |
Trade creditors |
Corporation tax |
Social security and other taxes |
Other creditors |
PGB inter company loan | 200 | 200 |
Directors' loan accounts | 531,625 | 173,500 |
Accrued expenses |
Deferred government grants |
14. | CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR |
29/2/24 | 28/2/23 |
(Unaudited) |
£ | £ |
Directors' loan accounts | - | 556,625 |
15. | PROVISIONS FOR LIABILITIES |
29/2/24 | 28/2/23 |
(Unaudited) |
£ | £ |
Deferred tax | 220,000 | 170,000 |
Deferred |
tax |
£ |
Balance at 1 March 2023 |
Movement | 50,000 |
Balance at 29 February 2024 |
Shortbread House of Edinburgh Limited (Registered number: SC115377) |
Notes to the Financial Statements - continued |
for the Year Ended 29 February 2024 |
16. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 29/2/24 | 28/2/23 |
value: | £ | £ |
Ordinary A | £1 | 86,500 | 86,500 |
Ordinary B | £1 | 43,500 | 43,500 |
Ordinary C | £1 | 20,152 | 20,152 |
Ordinary D | £1 | 20,152 | 20,152 |
Ordinary E | £1 | 2,151 | 2,151 |
200 | Ordinary Z | £1 | 200 | 200 |
172,655 | 172,655 |
17. | PENSION COMMITMENTS |
The company operates two defined contribution pension schemes. The assets of the schemes are held separately from those of the company in independently administered funds. The directors scheme is a SSAS scheme. No pension contributions were payable to either pension scheme at the year end. |
18. | DIRECTORS' ADVANCES, CREDITS AND GUARANTEES |
The following advances repayable >1 year from directors subsisted during the year as follows: |
28/02/24 | 28/02/23 |
£ | £ |
Mr A R Laing | 231,625 | 256,625 |
Mrs F Laing | 300,000 | 300,000 |
531,625 | 556,625 |
Mr A R Laing provided a loan to the company with an outstanding balance at the year end of £231,625. The repayment terms of the loan were changed during the year to repayable on demand, when previously the loan was repayable on 31 May 2031. Interest may be charged at 3% above base rate and unless waived will be paid on the redemption of the loan. No interest has been charged on the loans to date. |
Mrs F Laing provided a loan to the company of £300,000. The repayment terms of the loan were changed during the year to repayable on demand, when previously the loan was repayable on 30 July 2031. Interest may be charged at 2% above the base rate and unless waived will be paid on the redemption of the loan. No interest has been charged on the loan to date. |
19. | RELATED PARTY DISCLOSURES |
During the year, the company paid wages and salaries totalling £51,782 (2023: £46,634) to employees of an unincorporated business owned by Anthony Laing. The full cost of these wages and salaries are repaid to the company by Anthony Laing twice a year. At the year end £758 was outstanding (2023 Nil) but has since been repaid. |
20. | EVENTS AFTER THE END OF THE REPORTING PERIOD |
On 3rd May 2024, Shortbread House of Edinburgh Ltd committed to the purchase of two flow wrap machines at a total cost of £295,090, with an initial payment of £118,036 being made on 13th May 2024. There was no contractual commitment to the purchase at the year end. |