WILLIAM LOCKIE & COMPANY LIMITED |
STRATEGIC REPORT, REPORT OF THE DIRECTORS AND |
FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
WILLIAM LOCKIE & COMPANY LIMITED |
STRATEGIC REPORT, REPORT OF THE DIRECTORS AND |
FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
CONTENTS OF THE FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31ST JANUARY 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 |
Balance Sheet | 12 |
Statement of Changes in Equity | 13 |
Cash Flow Statement | 14 |
Notes to the Cash Flow Statement | 15 |
Notes to the Financial Statements | 17 |
WILLIAM LOCKIE & COMPANY LIMITED |
COMPANY INFORMATION |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
DIRECTORS: |
SECRETARY: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
AUDITORS: |
Chartered Accountants & Statutory Auditor |
19 Buccleuch Street |
Hawick |
Roxburghshire |
TD9 0HL |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
STRATEGIC REPORT |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
The directors present their strategic report for the year ended 31st January 2024. |
REVIEW OF BUSINESS |
We aim to present a balanced review of the development and performance of the company during the year and its position at the year end. Our review is consistent with the size and nature of our business and is written in the context of the risks and uncertainties we face. |
As a knitwear manufacturer the company continues to produce a range of products for sale in a number of geographic areas. Sales in these areas are set out in note 3 to the financial statements. |
We consider that our key performance indicators are those that communicate the financial performance of the company as a whole. A summary of these figures are set out below: |
2024 | 2023 | 2022 | 2021 |
£ | £ | £ | £ |
Turnover | 8,386,837 | 7,634,066 | 6,755,439 | 5,853,892 |
Gross Profit | 2,402,350 | 2,326,558 | 2,203,112 | 2,011,564 |
Net Profit/(Loss) (before tax and dividends) | (116,370 | ) | (134,225 | ) | 190,705 | 270,297 |
Net Assets | 2,434,432 | 2,801,984 | 721,603 | 98,149 |
Turnover has increased by 9.9% from last year following an increase in selling prices. Gross profit rate has decreased from last year to 28.6% (2023 30.5%), as cost of sales have increased, mainly in wage costs.. |
Distribution and selling costs have decreased from last year mainly in commissions paid. Administrative expenses have increased from last year, particularly in pension and heat & light costs. |
As a result of the increase in turnover the loss before tax has reduced from last year's level. |
The net assets have decreased by £367,552 in the year. This is due to the increase in borrowing in the year and the movement in pension scheme liability which had an increase in the liability of £117,000. |
PRINCIPAL RISKS AND UNCERTAINTIES |
The key business risks affecting the company continue to come from fluctuations in the British Economy and the impact of Brexit as well as alternative suppliers importing from territories with lower labour costs along with the cash outflows resulting from the losses experienced. |
The current economic conditions create uncertainty particularly over the level of demand for the company's products. The company seeks to manage this risk by diversifying and updating its product ranges where possible. |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
STRATEGIC REPORT |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES |
The company's activities expose it to a number of financial risks including credit risk, interest rate risk, currency risk and liquidity risk. |
Credit risk |
The company seeks to manage its credit risk by dealing with established customers or otherwise checking the credit-worthiness of new customers, establishing clear contractual relationships with these customers and by identifying and addressing any credit issues arising in a timely manner. |
Interest rate risk |
The company exposure to market risk for the changes in interest rates relates primarily to its bank borrowings. The company seeks to manage this risk by the use of a combination of variable and fixed rates. |
Currency risk |
The company minimises its risk to foreign currency fluctuations by invoicing and purchasing sterling where possible and where not by contracted exchange rates with bank. |
Liquidity risk |
The company seeks to manage financial risk by ensuring sufficient liquidity is available to meet foreseeable needs. Short-term flexibility is achieved by overdraft facilities and borrowings. This gives the company the necessary financial backing to carry out its intended plans and properly finance the ongoing operation of the business. |
GOING CONCERN |
After making enquiries, and evaluating business developments subsequent to the year end, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Further details of this assessment are provided in note 1 to the financial statements. |
FUTURE DEVELOPMENTS |
We continue to pursue a strategy of growth with our customers in wholesale, retail and online. Demand during 2024 is likely to be impacted by national and global economic factors and sales in some key customers are expected to be lower than previous years, and may still be subject to heightened and unpredictable variability. |
Margins will also be under pressure as the stock being sold through has been acquired at a time of high cashmere prices. Expectations are therefore for a reduction in profitability in the coming year. |
ON BEHALF OF THE BOARD: |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
REPORT OF THE DIRECTORS |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
The directors present their report with the financial statements of the company for the year ended 31st January 2024. |
PRINCIPAL ACTIVITY |
The principal activity of the company in the year under review was that of the manufacture and sale of knitwear. |
DIVIDENDS |
The total distribution of dividends during the year ended 1st February 2024 will be £Nil (2023 - £90,000). |
DIRECTORS |
The directors set out in the table below have held office during the whole of the period from 1st February 2023 to the date of this report. |
The beneficial interests of the directors holding office at 31st January 2024 in the shares of the company, according to the register of directors' interests, were as follows: |
31.1.24 | 1.2.23 |
Ordinary shares of £1.00 each |
600 | 600 |
600 | 600 |
2,825 | 2,825 |
1,675 | 1,675 |
These directors did not hold any non-beneficial interests in the shares of the company. |
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. |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
REPORT OF THE DIRECTORS |
FOR THE YEAR ENDED 31ST JANUARY 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. |
AUDITORS |
The auditors, JRW, will be proposed for re-appointment at the forthcoming Annual General Meeting. |
ON BEHALF OF THE BOARD: |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
WILLIAM LOCKIE & COMPANY LIMITED |
Opinion |
We have audited the financial statements of William Lockie & Company Limited (the 'company') for the year ended 31st January 2024 which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement and Notes to the Cash Flow Statement, 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 31st January 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. |
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. |
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. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
WILLIAM LOCKIE & COMPANY LIMITED |
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. |
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 |
WILLIAM LOCKIE & COMPANY 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: |
Identifying and assessing potential risks related to irregularities |
- Enquiring with management and the directors, 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 on non compliance; |
- Detecting and responding to the risks of fraud and whether they have any knowledge of any actual, suspected or alleged fraud; and |
- The internal controls established to mitigate risks related to fraud or non-compliance with laws and regulations; |
- Discussing with the engagement team how and where fraud might occur in the financial statements and any potential indicators of fraud. |
- 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. These areas were identified through enquiries with the director, management and our knowledge and understanding of the company accumulated throughout the audit and our sector-specific experience. |
Audit responses to risks identified |
As a result of performing the above, we identified the stock as being particularly susceptible to misstatement. The following work was carried out: |
- Stock existence, movement, cut-off and valuation tested. |
In addition to the above, our procedures to respond to the risks identified included the following: |
-Reviewing the financial statement disclosures and testing and supporting documentation to assess compliance with relevant laws and regulations. |
- Performing analytical procedures to identify any unusual or unexpected relationships that may indicate the risk of material misstatement due to fraud. |
- In addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments. |
We also communicated relevant laws and regulations identified and potential fraud risks to all engagement team members and remained vigilant to any indications of fraud or non-compliance with laws and regulations throughout the audit. |
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. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
WILLIAM LOCKIE & COMPANY LIMITED |
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 |
Chartered Accountants & Statutory Auditor |
19 Buccleuch Street |
Hawick |
Roxburghshire |
TD9 0HL |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
INCOME STATEMENT |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
Year ended | Period |
31.1.24 | 2.2.22 to 31.1.23 |
Notes | £ | £ | £ | £ |
TURNOVER | 3 |
Cost of sales |
GROSS PROFIT |
Distribution and selling costs |
Administrative expenses |
2,380,463 | 2,339,427 |
21,887 | (12,869 | ) |
Other operating income | 4 |
OPERATING PROFIT | 6 |
Interest receivable and similar income | 7 |
50,261 | 9,243 |
Interest payable and similar expenses | 8 |
Other finance costs | 22 |
166,631 | 143,468 |
LOSS BEFORE TAXATION | ( |
) | ( |
) |
Tax on loss | 9 | ( |
) | ( |
) |
LOSS FOR THE FINANCIAL YEAR | ( |
) | ( |
) |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
OTHER COMPREHENSIVE INCOME |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
Period |
2.2.22 |
Year ended | to |
31.1.24 | 31.1.23 |
Notes | £ | £ |
LOSS FOR THE YEAR | ( |
) | ( |
) |
OTHER COMPREHENSIVE | (LOSS)/INCOME |
Actuarial gains/(losses) on pension plan | ( |
) |
Income tax relating to other comprehensive (loss)/income |
( |
) |
OTHER COMPREHENSIVE (LOSS)/INCOME FOR THE YEAR, NET OF INCOME TAX |
( |
) |
TOTAL COMPREHENSIVE (LOSS)/INCOME FOR THE YEAR |
( |
) |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
BALANCE SHEET |
31ST JANUARY 2024 |
2024 | 2023 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Tangible assets | 11 |
CURRENT ASSETS |
Stocks | 12 |
Debtors | 13 |
Cash at bank and in hand |
CREDITORS |
Amounts falling due within one year | 14 |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
CREDITORS |
Amounts falling due after more than one year |
15 |
( |
) |
( |
) |
PROVISIONS FOR LIABILITIES | 19 | ( |
) | ( |
) |
PENSION LIABILITY | 22 | ( |
) | ( |
) |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 20 |
Capital redemption reserve | 21 |
Retained earnings | 21 |
SHAREHOLDERS' FUNDS |
The financial statements were approved by the Board of Directors and authorised for issue on |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
STATEMENT OF CHANGES IN EQUITY |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
Called up | Capital |
share | Retained | redemption | Total |
capital | earnings | reserve | equity |
£ | £ | £ | £ |
Balance at 2nd February 2022 |
Changes in equity |
Dividends | - | ( |
) | - | ( |
) |
Total comprehensive income | - |
Balance at 31st January 2023 |
Changes in equity |
Total comprehensive loss | - | ( |
) | ( |
) |
Balance at 31st January 2024 |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
CASH FLOW STATEMENT |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
Period |
2.2.22 |
Year ended | to |
31.1.24 | 31.1.23 |
Notes | £ | £ |
Cash flows from operating activities |
Cash generated from operations | 1 | ( |
) |
Interest paid | ( |
) | ( |
) |
Interest element of hire purchase payments paid |
( |
) |
Tax paid | ( |
) |
Net cash from operating activities | ( |
) |
Cash flows from investing activities |
Purchase of tangible fixed assets | ( |
) | ( |
) |
Interest received |
Net cash from investing activities | ( |
) |
Cash flows from financing activities |
New loans in year |
Loan repayments in year | ( |
) | ( |
) |
Equity dividends paid | ( |
) |
Net cash from financing activities | ( |
) |
Increase/(decrease) in cash and cash equivalents | ( |
) |
Cash and cash equivalents at beginning of year |
2 |
1,614,261 |
Cash and cash equivalents at end of year |
2 |
1,327,862 |
1,055,684 |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
NOTES TO THE CASH FLOW STATEMENT |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
1. | RECONCILIATION OF LOSS BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS |
Period |
2.2.22 |
Year ended | to |
31.1.24 | 31.1.23 |
£ | £ |
Loss before taxation | ( |
) | ( |
) |
Depreciation charges |
Pension charge less cash contributions | (289,000 | ) | (197,000 | ) |
Finance costs | 166,631 | 143,468 |
Finance income | (5,373 | ) | (1,093 | ) |
(149,181 | ) | (78,100 | ) |
Decrease/(increase) in stocks | ( |
) |
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 Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts: |
Year ended 31st January 2024 |
31.1.24 | 1.2.23 |
£ | £ |
Cash and cash equivalents | 1,327,862 | 1,055,684 |
Period ended 31st January 2023 |
31.1.23 | 2.2.22 |
£ | £ |
Cash and cash equivalents | 1,055,684 | 1,614,261 |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
NOTES TO THE CASH FLOW STATEMENT |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
3. | ANALYSIS OF CHANGES IN NET FUNDS |
At 1.2.23 | Cash flow | At 31.1.24 |
£ | £ | £ |
Net cash |
Cash at bank and in hand | 1,055,684 | 272,178 | 1,327,862 |
1,055,684 | 1,327,862 |
Debt |
Finance leases | - | (324,000 | ) | (324,000 | ) |
Debts falling due within 1 year | (80,000 | ) | - | (80,000 | ) |
Debts falling due after 1 year | (213,333 | ) | 80,000 | (133,333 | ) |
(293,333 | ) | (244,000 | ) | (537,333 | ) |
Total | 762,351 | 28,178 | 790,529 |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
NOTES TO THE FINANCIAL STATEMENTS |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
1. | STATUTORY INFORMATION |
William Lockie & Company Limited is a |
The presentation currency of the financial statements is the Pound Sterling (£). |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
Going concern |
The company's business activities, together with the factors likely to affect its future development, performance and position are set out in the Strategic Report on pages 2 to 3. The financial position of the company, including its cash flows, are set out in pages 10 to 14 and the notes to the financial statements. |
The directors regularly monitor and review the financial information, and at the year end had significantly increased the cash reserves held by the company. On the basis of this information the directors consider that the company will continue to operate within its banking arrangements. |
Based on their reviews the directors believe that it remains appropriate to prepare the financial statements on a going concern basis. |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
2. | ACCOUNTING POLICIES - continued |
Significant judgements and estimates |
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported. These estimates and judgements are continually reviewed and are based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. |
Significant judgements |
The judgements (apart from those involving estimations) that management has made in the process of applying the company's accounting policies and that have the most significant effect on the amounts recognised in the financial statements are as follows: |
Depreciation |
Tangible assets are recognised at cost less accumulated depreciation and impairments. Depreciation takes place over the estimated useful life, down to the assets residual value. The rate of depreciation for different asset categories is set out in a separate note below, these are reviewed regularly by the directors. The carrying amount of the company's fixed assets is tested as changed conditions show that a need for impairment has arisen. |
Stock obsolescence provision |
The company's stock values have been assessed at the reporting date for slow moving stock whereby the future value of the stock may be reduced below current valuations due to stock obsolescence. An allowance has therefore been made for slow moving stock in the valuation of the stock. |
Stock margin adjustment |
The value of finished goods and work in progress at the reporting date is based upon sales price less a profit margin that is reviewed calculated each year. Work in progress valuations are based on those reduced sales prices on a percentage complete basis. |
Recognition of deferred tax asset |
Deferred tax assets should only be recognised when it is considered probable that they will be recovered against future taxable profits. The pension liability in the balance sheet is shown at a lower value than it would appear from the pension assets and liabilities, as reported later in the notes, due to the reduction in future taxable profits from the contributions required to fund the pension liability. |
Pension scheme liability |
The company operates a defined benefit pension scheme, as reported on later in the notes. The calculation of the scheme assets and future liabilities is subject to a number of variables outwith the company's control. The company employs the scheme actuaries to provide an annual valuation taking into account these variables, which they review regularly, in order to report on the valuation of the assets and liabilities. |
Key sources of estimation uncertainty |
Accounting estimates and assumptions are made concerning the future and, by their nature, may not equal the related actual outcome. |
Accruals |
At the end of the year costs due for the period that are unpaid and uninvoiced are reviewed and accounted for by way of accruals, the key figure being commission due to sales agents. The final figure included in the financial statements are checked as far as possible to actual payments made after the year end to be as accurate as possible. |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
2. | ACCOUNTING POLICIES - continued |
Bad debt provision |
At the end of the year the list of outstanding debtors is reviewed for those who may be at risk of non-payment and a provision is made to include that potential cost in the year. Efforts to collect the debts continue even if provided for and if recovered will be offset against bad debts in the following year. |
Turnover |
Turnover comprises revenue recognised by the company in respect of goods and services supplied, exclusive of Value Added Tax and trade discounts. Revenue is recognised when when goods are dispatched. |
Tangible fixed assets |
Buildings | - |
Plant and machinery | - |
Office equipment | - |
Motor vehicles | - |
Whilst Buildings are noted to be depreciated over 40 years no charge has been made against their cost on the basis that their estimated residual value is in line with the cost carried in the balance sheet. Should a difference arise in future years it will be depreciated in line with the policy stated above. |
Stocks and work in progress |
Stocks are valued at the lower of cost and net realisable value after making due allowance for obsolete and slow moving items. In the case of finished goods and work in progress cost comprises direct materials, direct labour and an appropriate proportion of manufacturing fixed and variable overheads. The allocation of manufacturing fixed overhead has regard to budgeted normal production. |
Raw materials, consumables and goods for resale - purchase cost on a first in, first out basis. Yarn stock has a small provision made to allow for waste. |
Finished goods - cost of direct materials and labour plus attributable overheads based on a normal level of activity. These are calculated from a sales price and a profit margin deducted. |
Work in progress - on the same basis as finished goods but with a reduction to allow for percentage of completion at 6 key stages. |
Net realisable value is based on estimated selling price less any further costs expected to be incurred to completion and disposal. |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
2. | ACCOUNTING POLICIES - continued |
Financial instruments |
Financial assets |
Basic financial assets, including trade and other debtors and bank balances, are initially recognised at transaction price. |
At the end of each reporting period financial assets measured at cost are assessed for evidence of impairment. Any impairment loss is recognised in the Income Statement. |
Financial assets are derecognised when the contractual rights to the cash flows from the asset expire or are settled. |
Financial liabilities |
Basic financial liabilities, including trade and other creditors, are initially recognised at transaction price. |
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. These are classed as current liabilities as payment is due within one year of less. If not they are presented as non-current liabilities. |
Financial liabilities are derecognised when the liability is extinguished, that is when the contractual obligation is discharged, cancelled or expires. |
Other financial instruments |
The company utilises short term foreign exchange contracts to try to mitigate the impact of currency fluctuations. At the end of the year there were no contracts carrying forward into the following year, thereby there is no adjustment to the accounts for their use. |
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 balance sheet date. |
Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet 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. |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
2. | ACCOUNTING POLICIES - continued |
Foreign currencies |
Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result. |
Hire purchase and leasing commitments |
Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease. |
Pension costs and other post-retirement benefits |
The company operates a defined benefits pension scheme and the pension charge is based on a full actuarial valuation. The assets of these plans are held in separate trustee administered funds. The defined benefit plan's assets are measured using market values. Pension plan liabilities are measured by an actuary using the projected unit method and discounted at the current rate of return on a high quality corporate bond of equivalent term and currency to the liability. The increase in the present value of the liabilities of the company's defined benefit pension plans expected to arise from employee service in the period is charged to operating profit. The expected return on the plan's assets and the increase during the period in the present value of the plan's liabilities arising from the passage of time are included in other finance income. Actuarial gains and losses are recognised in the statement of total recognised gains and losses. |
The pension plans, surpluses to the extent that they are considered recoverable, or deficits are recognised in full and presented on the face of the balance sheet net of the related deferred tax. |
Government grants |
Government grants relating to tangible fixed assets are treated as deferred income and released to the profit and loss account over the expected useful lives of the assets concerned. Other grants are credited to the profit and loss account as the related expenditure is incurred. |
3. | TURNOVER |
The turnover and loss before taxation are attributable to the one principal activity of the company. |
An analysis of turnover by geographical market is given below: |
Period |
2.2.22 |
Year ended | to |
31.1.24 | 31.1.23 |
£ | £ |
United Kingdom |
Europe |
United States of America |
Asia |
Rest of world | 151,912 | 147,968 |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
4. | OTHER OPERATING INCOME |
Period |
2.2.22 |
Year ended | to |
31.1.24 | 31.1.23 |
£ | £ |
Rents received |
Sundry receipts | 2,398 | 475 |
Government grants |
23,001 | 21,019 |
5. | EMPLOYEES AND DIRECTORS |
Period |
2.2.22 |
Year ended | to |
31.1.24 | 31.1.23 |
£ | £ |
Wages and salaries |
Social security costs |
Other pension costs |
The average number of employees during the year was as follows: |
Period |
2.2.22 |
Year ended | to |
31.1.24 | 31.1.23 |
Production Staff | 115 | 116 |
Administrative Staff | 11 | 13 |
Period |
2.2.22 |
Year ended | to |
31.1.24 | 31.1.23 |
£ | £ |
Directors' remuneration |
The number of directors to whom retirement benefits were accruing was as follows: |
Defined benefit schemes |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
6. | OPERATING PROFIT |
The operating profit is stated after charging/(crediting): |
Period |
2.2.22 |
Year ended | to |
31.1.24 | 31.1.23 |
£ | £ |
Hire of plant and machinery |
Other operating leases |
Depreciation - owned assets |
Auditors' remuneration |
Foreign exchange differences | ( |
) |
7. | INTEREST RECEIVABLE AND SIMILAR INCOME |
Period |
2.2.22 |
Year ended | to |
31.1.24 | 31.1.23 |
£ | £ |
Deposit account interest |
Other interest receivable |
8. | INTEREST PAYABLE AND SIMILAR EXPENSES |
Period |
2.2.22 |
Year ended | to |
31.1.24 | 31.1.23 |
£ | £ |
Bank interest |
Bank loan interest |
Hire purchase |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
9. | TAXATION |
Analysis of the tax credit |
The tax credit on the loss for the year was as follows: |
Period |
2.2.22 |
Year ended | to |
31.1.24 | 31.1.23 |
£ | £ |
Current tax: |
Over provision of taxation | - | (44,618 | ) |
Deferred tax | ( |
) |
Tax on loss | ( |
) | ( |
) |
Reconciliation of total tax credit included in profit and loss |
The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained below: |
Period |
2.2.22 |
Year ended | to |
31.1.24 | 31.1.23 |
£ | £ |
Loss before tax | ( |
) | ( |
) |
Loss multiplied by the standard rate of corporation tax in the UK of |
Effects of: |
Adjustments to tax charge in respect of previous periods | ( |
) |
Movement in deferred tax | (19,818 | ) | 41,012 |
Total tax credit | (19,818 | ) | (3,606 | ) |
Tax effects relating to effects of other comprehensive income |
2024 |
Gross | Tax | Net |
£ | £ | £ |
Actuarial gains/(losses) on pension plan | ( |
) | 64,000 | (271,000 | ) |
2.2.22 to 31.1.23 |
Gross | Tax | Net |
£ | £ | £ |
Actuarial gains/(losses) on pension plan | (540,000 | ) | 2,301,000 |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
10. | DIVIDENDS |
Period |
2.2.22 |
Year ended | to |
31.1.24 | 31.1.23 |
£ | £ |
Ordinary shares of £1.00 each |
Final |
11. | TANGIBLE FIXED ASSETS |
Plant and | Office | Motor |
Buildings | machinery | equipment | vehicles | Totals |
£ | £ | £ | £ | £ |
COST |
At 1st February 2023 |
Additions |
Disposals | ( |
) | ( |
) |
At 31st January 2024 |
DEPRECIATION |
At 1st February 2023 |
Charge for year |
Eliminated on disposal | ( |
) | ( |
) |
At 31st January 2024 |
NET BOOK VALUE |
At 31st January 2024 |
At 31st January 2023 |
12. | STOCKS |
2024 | 2023 |
£ | £ |
Raw materials |
Work-in-progress |
Finished goods |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
13. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2024 | 2023 |
£ | £ |
Trade debtors |
Tax |
Prepayments and accrued income |
14. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2024 | 2023 |
£ | £ |
Bank loans and overdrafts (see note 16) |
Hire purchase contracts (see note 17) |
Trade creditors |
Social security and other taxes |
Accruals and deferred income |
15. | CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR |
2024 | 2023 |
£ | £ |
Bank loans (see note 16) |
Hire purchase contracts (see note 17) |
16. | LOANS |
An analysis of the maturity of loans is given below: |
2024 | 2023 |
£ | £ |
Amounts falling due within one year or on demand: |
Bank loans |
Amounts falling due between one and two years: |
Bank loans - 1-2 years |
Amounts falling due between two and five years: |
Bank loans - 2-5 years |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
17. | LEASING AGREEMENTS |
Minimum lease payments under hire purchase fall due as follows: |
2024 | 2023 |
£ | £ |
Net obligations repayable: |
Within one year |
Between one and five years |
18. | SECURED DEBTS |
The bank overdraft and loan is secured by a disposition ex facie absolute with The Royal Bank of Scotland over all of the company's premises, and a floating charge over the remaining assets. |
19. | PROVISIONS FOR LIABILITIES |
2024 | 2023 |
£ | £ |
Deferred tax | 60,666 | 80,484 |
Deferred |
tax |
£ |
Balance at 1st February 2023 |
Accelerated capital allowances | (19,818 | ) |
Other timing differences |
Balance at 31st January 2024 |
20. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2024 | 2023 |
value: | £ | £ |
Ordinary | £1.00 | 9,000 | 9,000 |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
21. | RESERVES |
Capital |
Retained | redemption |
earnings | reserve | Totals |
£ | £ | £ |
At 1st February 2023 | 2,792,984 |
Deficit for the year | ( |
) | ( |
) |
Actuarial gain/(loss) on the pension plan net of deferred tax |
(271,000 |
) |
- |
(271,000 |
) |
At 31st January 2024 | 2,425,432 |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
22. | EMPLOYEE BENEFIT OBLIGATIONS |
The company operates a defined benefit pension scheme in the UK, which is funded by the payment of contributions to a separately administered trust fund. This scheme is closed to new entrants and therefore under the projected unit method used for FRS 102, the current service cost as a percentage of salary will increase as active members of the scheme approach retirement. |
The valuation used for FRS 102 disclosures has been based on the most recent actuarial valuation as at 30 June 2017 and updated to 31 January 2024 by a qualified actuary, to take account of the requirements of FRS 102 in order to assess the liabilities of the scheme at 31 January 2024. Scheme assets are stated at their market value at the respective balance sheet dates. |
As the scheme stands, the directors should expect the net pension asset or liability and profit and loss charge to be volatile from year to year. This is because the trustees currently invest the assets largely in equities whereas the liability value depends on the yield on long-dated corporate bonds. These two asset classes can move in different directions, causing the pension disclosure on the balance sheet to improve or deteriorate rapidly. |
Analysis of Position |
Over the accounting period to 31st January 2024 the FRS 102 overall deficit has increased in size from £3,084,000 to £3,265,000. The deficit reported on the balance sheet of £2,583,000 is after adjusting for deferred taxation. |
The following specific items have contributed to this position: |
Experience Items: |
- The deficit reduction contributions paid by the Company have served to reduce the deficit. |
- The performance of the assets was more than expected when compared to the assumption made last year which has served to increase the deficit.The actuarial gain for the year £234,000 (2023 actuarial gain £3,564,000) |
Changes Made to the Assumptions: |
- The discount rate used has increased from 4.6% p.a.to 4.8% p.a.. This has served to decrease the deficit. |
- The CPI price inflation assumption has decreased from 2.75% p.a. to 2.65% p.a. This has served to decrease the deficit. |
- The assumption for future salary increases has decreased from 2.75% p.a. to 2.65% p.a. This has served to decrease the deficit. |
- Overall, the changes made to the assumptions have served to decrease the liabilities and resultant deficit. |
Other factors have had an effect but to a lesser extent. |
The table below shows the effect of these experience items and changes made in assumptions for the period ending 31st January 2024: |
Item | £'000s |
Actual return less expected return on the Scheme assets | (569 | ) |
Experience gains and losses arising on the Scheme liabilities | (57 | ) |
Changes in assumptions underlying the present value of the Scheme liabilities | 291 |
Actuarial gain/(loss) recognised in OCI | (335 | ) |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
22. | EMPLOYEE BENEFIT OBLIGATIONS - continued |
The amounts recognised in profit or loss are as follows: |
Defined benefit |
pension plans |
2024 | 2023 |
£ | £ |
Current service cost |
Net interest from net defined benefit asset/liability |
135,000 |
130,000 |
Past service cost |
212,000 | 234,000 |
Actual return on plan assets |
Changes in the present value of the defined benefit obligation are as follows: |
Defined benefit |
pension plans |
2024 | 2023 |
£ | £ |
Opening defined benefit obligation |
Current service cost |
Contributions by scheme participants |
Interest cost |
Benefits paid | ( |
) | ( |
) |
Remeasurements: |
Actuarial (gains)/losses from changes in financial assumptions |
(291,000 |
) |
(3,775,000 |
) |
Experience items | 57,000 | 211,000 |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
22. | EMPLOYEE BENEFIT OBLIGATIONS - continued |
Changes in the fair value of scheme assets are as follows: |
Defined benefit |
pension plans |
2024 | 2023 |
£ | £ |
Opening fair value of scheme assets |
Contributions by employer |
Contributions by scheme participants |
Expected return | 227,000 | 124,000 |
Benefits paid | (271,000 | ) | (655,000 | ) |
Return on plan assets (excluding interest income) |
(569,000 |
) |
(723,000 |
) |
The amounts recognised in other comprehensive income are as follows: |
Defined benefit |
pension plans |
2024 | 2023 |
£ | £ |
Actuarial (gains)/losses from changes in financial assumptions |
291,000 |
3,775,000 |
Experience items | (57,000 | ) | (211,000 | ) |
Return on plan assets (excluding interest income) |
(569,000 |
) |
(723,000 |
) |
(335,000 | ) | 2,841,000 |
The major categories of scheme assets as amounts of total scheme assets are as follows: |
Defined benefit |
pension plans |
2024 | 2023 |
£ | £ |
Diversified Growth Funds |
Bonds |
Cash | 89,000 | 48,000 |
4,648,000 | 4,873,000 |
Equities asset allocation includes the TEAMS Diversified Growth Fund. |
The company expects to contribute £520,000 in respect of deficit reduction contributions rising by 4% annually. |
WILLIAM LOCKIE & COMPANY LIMITED (REGISTERED NUMBER: SC023788) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE YEAR ENDED 31ST JANUARY 2024 |
22. | EMPLOYEE BENEFIT OBLIGATIONS - continued |
Principal actuarial assumptions at the balance sheet date (expressed as weighted averages): |
2024 | 2023 |
Discount rate |
Future salary increases |
Retail price inflation |
Rate of increase in pensions in payment | 2.20% | 2.20% |
Rate of increase in deferred pensions | 2.57% | 2.62% |
23. | RELATED PARTY DISCLOSURES |
One of the directors is also a shareholder in another company. During the year the net sales and purchases with that company were £11,356 (2022, £5,480) and £97,879 (2023, £97,879) respectively. At the year end William Lockie & Company Ltd were owing the company £15,713 (2023, £12,413). These balances are included within trade creditors in the balance sheet. |
One of the directors is also a shareholder and director of another company. During the year the net sales and purchases with that company were £130,586 (2023, £152,204) and £2,072 (2023, £125) respectively. At the year end William Lockie & Company Ltd were due £35,087 from the other company (2023, £52,641). These balances are included within trade debtors in the balance sheet. At the year end William Lockie & Company Ltd were owing the company £2,412 (2023, £Nil). These balances are included withing trade creditors in the balance sheet. |
24. | ULTIMATE CONTROLLING PARTY |
In the directors' opinion, the company has no ultimate controlling party. |