Company registration number 01362065 (England and Wales)
SPECMAT LIMITED
UNAUDITED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024
PAGES FOR FILING WITH REGISTRAR
SPECMAT LIMITED
CONTENTS
Page
Balance sheet
1 - 2
Notes to the financial statements
3 - 12
SPECMAT LIMITED
BALANCE SHEET
AS AT
31 JANUARY 2024
31 January 2024
- 1 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
4
18,566
24,101
Investment property
5
10,080,438
8,921,963
Investments
6
6,268,776
5,778,787
16,367,780
14,724,851
Current assets
Debtors
7
3,464,207
4,212,838
Cash at bank and in hand
169,675
38,497
3,633,882
4,251,335
Creditors: amounts falling due within one year
8
(13,674,192)
(12,325,684)
Net current liabilities
(10,040,310)
(8,074,349)
Total assets less current liabilities
6,327,470
6,650,502
Provisions for liabilities
9
(123,831)
(15,009)
Net assets
6,203,639
6,635,493
Capital and reserves
Called up share capital
880
880
Capital redemption reserve
120
120
Profit and loss reserves
11
6,202,639
6,634,493
Total equity
6,203,639
6,635,493

The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true

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

The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.

The members have not required the company to obtain an audit of its financial statements for the year in question in accordance with section 476.

These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.

SPECMAT LIMITED
BALANCE SHEET (CONTINUED)
AS AT
31 JANUARY 2024
31 January 2024
- 2 -
The financial statements were approved by the board of directors and authorised for issue on 5 September 2024 and are signed on its behalf by:
Mr R E L Smith
Director
Company Registration No. 01362065
SPECMAT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2024
- 3 -
1
Accounting policies
Company information

Specmat Limited is a private company limited by shares incorporated in England and Wales. The registered office is Street Court, Kingsland, Leominster, Herefordshire, United Kingdom, HR6 9QA.

1.1
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.

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.

Preparation of consolidated financial statements

The financial statements contain information about Specmat Limited as an individual company and do not contain consolidated financial information as the parent of a group. The company has taken the option under Section 399 of the Companies Act 2006 not to prepare consolidated financial statements.

Related party exemption

The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group.

1.2
Going concern

Ongoing financial support by related companies has provided the working capital for the company to trade. The directors consider that this support will be maintained for the foreseeable future and therefore atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.3
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

Revenue from rents receivable represents the value of rentals received or receivable from tenants of freehold and leasehold properties held by the company during the period, excluding value added tax.

1.4
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:

Plant and machinery etc
15% on cost
SPECMAT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
1
Accounting policies
(Continued)
- 4 -

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.

Cost includes purchase cost and other costs directly attributable to making the asset capable of operating as intended.

 

Freehold property are stated at deemed cost being the directors valuation at the date of transition to FRS102.

 

An amount equal to the excess of the annual depreciation charge on revalued assets over the notional historical cost depreciation charge on those assets is transferred annually from the revaluation reserve to the profit and loss account.

1.5
Investment properties

Investment property, which is property held to earn rentals and/or for capital appreciation, is initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Subsequently it is measured at fair value at the reporting end date.

 

The fair values of the assets are regularly reviewed by the directors and further adjustments to carrying values are made where considered appropriate.

 

Hence, certain investment properties are included in the balance sheet at their fair value after due consideration and advice sought by the directors. Advice is sought from independent property consultants which then forms a basis for the directors' valuation .

 

Any gains or losses arising from changes in the fair value of investment properties are included in the profit and loss account in the period in which they arise.

 

1.6
Fixed asset investments

Subsidiaries

Interests in subsidiaries, associates and jointly controlled entities are initially measured at transaction price excluding transaction costs, and are subsequently measured at fair value at each reporting date. Changes in fair value are recognised in profit or loss. Transaction costs are expensed to profit or loss as incurred.

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.

Investments in subsidiaries are accounted for at cost less accumulated impairment losses.

 

Other investments

Other investments, which are held for capital appreciation, are initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Subsequently they are measured at fair value at the reporting end date.

 

The fair values of the assets are regularly reviewed by the directors and further adjustments to carrying values are made where considered appropriate.

 

Any gains or losses arising from changes in the fair value of other investments are included in the profit and loss account in the period in which they arise.

SPECMAT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
1
Accounting policies
(Continued)
- 5 -
1.7
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.

1.8
Cash at bank and in hand

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.

1.9
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.

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.

SPECMAT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
1
Accounting policies
(Continued)
- 6 -
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.

1.10
Equity instruments

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

1.11
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

1.12
Provisions

Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.

 

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.

SPECMAT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
1
Accounting policies
(Continued)
- 7 -
1.13
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

 

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.

1.14
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.

2
Judgements and key sources of estimation uncertainty

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

Key sources of estimation uncertainty

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

Useful lives of tangible assets

The annual depreciation charges for tangible assets is sensitive to changes in the estimated useful lives and residual values of the assets. The useful lives and residual values are re-assessed at each reporting date. They are amended when necessary to reflect current estimates, based on future investments, economic utilisation and the physical condition of the assets.

Valuation of investment property

Investment properties are reviewed annually for their fair value, where this valuation materially differs to carrying value, adjustments are made to revalue these assets. This movement is recognised in profit or loss.

 

Independent valuations are obtained from suitably qualified professionals. These are conducted on a periodic basis in order to prevent material misstatement.

 

A non-distributable reserve has arisen in relation to historical gains recognised net of deferred taxation.

 

The fair value of investment properties was assessed at 31 January 2024 to be £10,080,438 (2023: £8,921,963).

 

 

SPECMAT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 8 -
3
Employees

The average monthly number of persons (including directors) employed by the company during the year was:

2024
2023
Number
Number
Total
3
3
4
Tangible fixed assets
Plant and machinery etc
£
Cost or valuation
At 1 February 2023 and 31 January 2024
54,433
Depreciation and impairment
At 1 February 2023
30,332
Depreciation charged in the year
5,535
At 31 January 2024
35,867
Carrying amount
At 31 January 2024
18,566
At 31 January 2023
24,101
5
Investment property
2024
£
Fair value
At 1 February 2023
8,921,963
Revaluations
1,158,475
At 31 January 2024
10,080,438

Certain investment property was revalued by the directors at 31 January 2024 to its fair value of £8,500,000 based on advice sought from independent valuers not connected with the company.

 

Certain investment property was revalued by the directors at 31 January 2024 to its fair value of £900,000 (2023: £741,525).

 

The remaining investment property relates to land held and are included at fair value, which has been deemed equal to the cost of £680,440 (2023: £680,440) after due consideration and advice sought by the directors.

SPECMAT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 9 -
6
Fixed asset investments
2024
2023
£
£
Shares in group undertakings and participating interests
1
1
Other investments other than loans
6,268,775
5,778,786
6,268,776
5,778,787
Movements in fixed asset investments
Shares in subsidiaries
Other investments
Total
£
£
£
Cost or valuation
At 1 February 2023
1
5,778,786
5,778,787
Additions
-
352,170
352,170
Valuation changes
-
137,819
137,819
At 31 January 2024
1
6,268,775
6,268,776
Carrying amount
At 31 January 2024
1
6,268,775
6,268,776
At 31 January 2023
1
5,778,786
5,778,787

Other investments of £2,086,139 (2023: £1,948,319) were revalued by the directors at 31 January 2024 by reference to active markets for the assets to which they relate.

 

The remaining other investments are included at fair value, which has been deemed equal to the cost of £4,182,636 (2023: £3,830,467) after due consideration by the directors.

7
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
16,034
6,049
Amounts owed by group undertakings
944,558
1,695,187
Other debtors
2,503,615
2,511,602
3,464,207
4,212,838

Amounts owed by group undertakings are unsecured, interest free, have no fixed date of repayment and are repayable on demand. The directors, having considered the recoverability of these balances, have made a provision amounting to £757,453 (2023: £Nil), which have been recognised in administrative expenses through profit or loss.

 

Included within other debtors are amounts of £2,499,574 (2023: £2,511,602) due from related undertakings. These amounts are unsecured, interest free, have no fixed date of repayment and are repayable on demand.

SPECMAT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 10 -
8
Creditors: amounts falling due within one year
2024
2023
£
£
Trade creditors
52,296
248,544
Taxation and social security
-
0
39,319
Other creditors
13,621,896
12,037,821
13,674,192
12,325,684

Within other creditors is a balance of £13,595,602 (2023: £11,929,862) owed to a certain related undertaking connected via common control. Interest is charged on this balance at 5% amounting to £632,180 (2023: £523,630) included in interest payable and similar expenses. The loan is unsecured, has no fixed date of repayment and is repayable on demand.

 

Other amounts totalling £2,377 (2023: £103,759) due to related undertakings connected by common control and as included in other creditors, are unsecured, interest free and have no fixed date of repayment and are repayable on demand.

9
Provisions for liabilities
2024
2023
£
£
Deferred tax liabilities
10
123,831
15,009
10
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:

Liabilities
Liabilities
2024
2023
Balances:
£
£
Accelerated capital allowances
(25,095)
(26,863)
Tax losses
(637,547)
(420,527)
Gain on revalued property
786,473
462,399
123,831
15,009
2024
Movements in the year:
£
Liability at 1 February 2023
15,009
Charge to profit or loss
108,822
Liability at 31 January 2024
123,831

 

SPECMAT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
10
Deferred taxation
(Continued)
- 11 -

A rate of 25% (2023: 25%) was used for purposes of considering the effects of deferred taxation in the current period, in line with the main rate of UK Corporation Tax effective from 1 April 2023.

SPECMAT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2024
- 12 -
11
Profit and loss reserves
2024
2023
£
£
At the beginning of the year
6,634,493
7,073,262
Loss for the year
(431,854)
(438,769)
At the end of the year
6,202,639
6,634,493
2024
2023
£
£
Non-distributable profits included above
At the beginning of the year
2,720,361
2,720,361
At the beginning and end of the year
2,720,361
2,720,361
Distributable profits
3,482,278
3,914,132
12
Financial commitments, guarantees and contingent liabilities

At the balance sheet the company had total guarantees, contingencies and commitments of £Nil (2023: £Nil).

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