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GROUP STRATEGIC REPORT,

REPORT OF THE DIRECTORS AND

CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 29 FEBRUARY 2024


FOR



BIRCHCLAIM LIMITED


BIRCHCLAIM LIMITED (REGISTERED NUMBER: 02584675)







CONTENTS OF THE CONSOLIDATED FINANCIAL STATEMENTS

For The Year Ended 29 February 2024





Page



Company Information  

1



Group Strategic Report  

2



Report of the Directors  

4



Report of the Independent Auditors  

5



Consolidated Income Statement  

7



Consolidated Other Comprehensive Income  

8



Consolidated Balance Sheet  

9



Company Balance Sheet  

10



Consolidated Statement of Changes in Equity  

11



Company Statement of Changes in Equity  

12



Consolidated Cash Flow Statement  

13



Notes to the Consolidated Cash Flow Statement

14



Notes to the Consolidated Financial Statements

15




BIRCHCLAIM LIMITED


COMPANY INFORMATION

For The Year Ended 29 February 2024









DIRECTORS:

R E Keith


B M Keith


J M Keith







REGISTERED OFFICE:

Unit 1, St Stephens Court


15 - 17 St Stephens Road


Bournemouth


Dorset


BH2 6LA







REGISTERED NUMBER:

02584675 (England and Wales)







AUDITORS:

Schofields


Chartered Accountants and Statutory Auditors


5th Floor


Waverley House


115-119 Holdenhurst Road


Bournemouth


Dorset


BH8 8DY


BIRCHCLAIM LIMITED (REGISTERED NUMBER: 02584675)


GROUP STRATEGIC REPORT

For The Year Ended 29 February 2024


The directors present their strategic report of the company and the group for the year ended 29 February 2024.


REVIEW OF BUSINESS

The company's main activities continue to be the provision of new and used vehicles, parts and servicing. Turnover from continuing activities for the year ended 29 February 2024 was £39,713,481 (2023 - £36,293,674). Profit before tax was £1,095,388 (2023 - £956,261).  The key financial highlights are shown as follows:



2024



2023



2022



2021




£'000



£'000



£'000



£'000



Vehicle sales


35,380



32,278



30,278



22,696



After sales and other income


4,333



4,016



4,412



3,367



Total sales


39,713



36,294



34,690



26,603



Gross profit


2,809



2,955



3,250



1,561



Net profit before tax


1,095



956



1,296



951





%



%



%



%



Turnover growth


9.42



4.62



33.10



(23.47)



Gross profit margin


7.07



8.14



9.37



5.99



Net profit margin


2.76



2.63



3.74



3.65




This proved to be a challenging year for both new and used car sales, caused by issues with new car stock availability and a drop off in used car values in the second half of the year.  Despite these challenges, the  group posted record sales figures albeit at reduced profit margins.  Our aftersales departments have performed , admirably, compensating for the difficulties faced in vehicle sales operations.


The group remains high in customer satisfaction scores, attained passes in 'Mystery Shop' exercises and achieved several of the Ford incentive programs.  Management continue to invest in staff training, health and wellbeing to ensure the group meets customer expectations.


In the face of high level inflation and increased costs, management continue to control these costs efficiently and review all key performance indicators and ratios. This ensures that the group adapts accordingly and manages working capital effectively, enabling the group to overcome challenges within the industry and the economy as a whole.


In light of the challenges faced within the industry, the board are pleased with group's performance and, with a recovering market, are optimistic for the year ahead.


PRINCIPAL RISKS AND UNCERTAINTIES

The board closely monitors and identifies mitigating actions to limit the exposure of material risks and uncertainties that are fundamental to the operation of the company.  Principal risks have been identified as follows:


Economic risk

The board continually monitors economic risk whereby negative economic conditions may affect the group's operations.  This risk is carefully considered when factoring in the current economy with high inflation and a rise in costs generally.


The group also operates a defined benefit pension scheme.  Assumptions adopted in its valuation, including RPI/CPI inflation and discount rates, are largely impacted by current economic conditions.


The impact of changing economic conditions is carefully managed through close engagement with Ford and the Trustees of the defined benefit pension scheme, along with strong working capital management.


Operational risk

The board recognise the continued importance of a strong relationship and the supply of new vehicles from our franchisor.  We further recognise the motor retail market in which the group operates is highly competitive.


The group is committed to providing the highest levels of customer service and provide regular staff training in order to continually meet these standards.  Our dedication to this has resulted in a number of awards in recent years, including the Ford Chairman's award for excellent customer service.


We further mitigate operations risk through focusing on our other core business areas including used vehicle sales, parts and service sales.



BIRCHCLAIM LIMITED (REGISTERED NUMBER: 02584675)


GROUP STRATEGIC REPORT

For The Year Ended 29 February 2024


PRINCIPAL RISKS AND UNCERTAINTIES (CONTINUED)

Financial risk

The group's operations expose it to a variety of financial risks that include the effects of credit risk and interest rate fluctuations on company debt.


Credit risk is limited to after sales invoices raised to trade customers whereby bad debts will detrimentally affect the cash flow and ultimate profitability of the company.  Credit risk is mitigated through determining the credit worthiness of each customer and setting appropriate credit limits.


Fluctuating interest rates can potentially give the group uncertainty over the amount of debt servicing cash payments.  Vehicle stocking loans are funded through a Ford credit facility.  Exposure to the rise in short-term interest rates is reduced through prompt repayment of credit provided, with bank borrowing at a fixed rate of interest.


ON BEHALF OF THE BOARD:






R E Keith - Director



17 October 2024


BIRCHCLAIM LIMITED (REGISTERED NUMBER: 02584675)


REPORT OF THE DIRECTORS

For The Year Ended 29 February 2024


The directors present their report with the financial statements of the company and the group for the year ended 29 February 2024.


DIVIDENDS

The total distribution of dividends for the year ended 29 February 2024 will be £100,000.


FUTURE DEVELOPMENTS

Despite the uncertain economic outlook over the foreseeable future, the board are confident that the group's policies and strategies in place will ensure that it can positively adapt and embrace the forthcoming challenges and changes in the industry.


EVENTS SINCE END OF THE YEAR

There have been no subsequent events after the balance sheet date that have a material effect on 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.


R E Keith

B M Keith

J M Keith


STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Group 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). 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 the group and of the profit or loss of the group 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 and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group 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 the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.


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 group'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 group's auditors are aware of that information.


AUDITORS

The auditors,  Schofields, will be proposed for re-appointment at the forthcoming Annual General Meeting.


ON BEHALF OF THE BOARD:






R E Keith - Director



17 October 2024


REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF

BIRCHCLAIM LIMITED


Opinion

We have audited the financial statements of Birchclaim Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 29 February 2024 which comprise the Consolidated Income Statement, Consolidated Other Comprehensive Income, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Cash Flow Statement and Notes to the Consolidated 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 group's and of the parent company affairs as at 29 February 2024 and of the group's 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 group 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 group's and the parent 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 Group 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.


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 Group 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 Group 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 group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group 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 by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or

-

the parent company 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.


REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF

BIRCHCLAIM LIMITED



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 group's and the parent 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 group or the parent company or to cease operations, or have no realistic alternative but to do so.


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:


An understanding of the legal and regulatory framework the company operates in was obtained through discussions with directors and other management in addition to our general industry and sector experience.  The most significant laws and regulations identified, being those that have a direct effect on material amounts and disclosures in the financial statements, are FRS 102, Companies Act 2006 and HM Revenue & Customs (HMRC) Tax Legislation.


We also considered other laws and regulations that do not have a direct effect on the financial statements but compliance with which may be fundamental to the company's ability to operate, or to avoid material penalty.  These included the requirements of the various health and safety regulations, employment law and money laundering.


Audit procedures were performed to obtain sufficient evidence regarding compliance.  These procedures include making enquiries to directors and other management in addition to the inspection of applicable regulatory and legal correspondence.  Financial statement disclosures were reviewed and tested to supporting documentation.


Enquiries were also made to the directors and other management to assess the company's internal control environment and their policies and procedures on fraud risk.  The company's systems and controls were documented, and audit procedures were designed to test these controls. Further, the risk of management override of controls was addressed through testing journal entries and other adjustments for appropriateness.  The judgements made in making accounting estimates were assessed for any indication of potential bias, and the business rationale of significant transactions outside the normal course of the business was evaluated.


We have properly planned and performed the audit in accordance with auditing standards and all members of the engagement team have the appropriate competence and capabilities to identify or recognise non-compliance with laws and regulations.  However, the inherent nature of the audit, and the limited procedures performed, means there is an unavoidable risk that some irregularities may have gone undetected.  We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.


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.





Mr D Leatham FCA FCCA (Senior Statutory Auditor)

for and on behalf of Schofields

Chartered Accountants and Statutory Auditors

5th Floor

Waverley House

115-119 Holdenhurst Road

Bournemouth

Dorset

BH8 8DY


17 October 2024


BIRCHCLAIM LIMITED (REGISTERED NUMBER: 02584675)


CONSOLIDATED INCOME STATEMENT

For The Year Ended 29 February 2024



2024


2023


Notes

£   

£   



TURNOVER

3

39,713,481


36,293,674




Cost of sales

(36,904,369

)

(33,338,232

)


GROSS PROFIT

2,809,112


2,955,442




Administrative expenses

(1,722,487

)

(1,950,691

)


OPERATING PROFIT

5

1,086,625


1,004,751




Interest receivable and similar income

48,288


-



1,134,913


1,004,751




Interest payable and similar expenses

6

(39,525

)

(35,490

)


Other finance costs

23

-


(13,000

)


PROFIT BEFORE TAXATION

1,095,388


956,261




Tax on profit

7

(259,660

)

(179,762

)


PROFIT FOR THE FINANCIAL YEAR

835,728


776,499



Profit attributable to:

Owners of the parent

835,728


776,499




BIRCHCLAIM LIMITED (REGISTERED NUMBER: 02584675)


CONSOLIDATED OTHER COMPREHENSIVE INCOME

For The Year Ended 29 February 2024



2024


2023


Notes

£   

£   



PROFIT FOR THE YEAR

835,728


776,499





OTHER COMPREHENSIVE INCOME  


Remeasurement gain/(loss) on defined

benefit pension plan

(59,750

)

349,650



Deferred tax (cost)/benefit arising on

actuarial gains

-


(79,857

)


Income tax relating to components of other

comprehensive income

-


-



OTHER COMPREHENSIVE INCOME FOR THE

YEAR, NET OF INCOME TAX

(59,750

)

269,793



TOTAL COMPREHENSIVE INCOME FOR THE

YEAR

775,978


1,046,292




Total comprehensive income attributable to:

Owners of the parent

775,978


1,046,292




BIRCHCLAIM LIMITED (REGISTERED NUMBER: 02584675)


CONSOLIDATED BALANCE SHEET

29 February 2024



2024

2023



Notes

£   

£   

£   

£   


FIXED ASSETS

Intangible assets

10

-


-



Tangible assets

11

2,076,958


2,013,343



Investments

12

-


-



Investment property

13

2,515,000


2,100,000



4,591,958


4,113,343




CURRENT ASSETS

Stocks

14

5,541,658


4,921,527



Debtors

15

203,416


248,035



Cash at bank and in hand

1,636,987


1,890,129



7,382,061


7,059,691



CREDITORS

Amounts falling due within one year

16

4,019,919


3,933,865



NET CURRENT ASSETS

3,362,142


3,125,826



TOTAL ASSETS LESS CURRENT LIABILITIES

7,954,100


7,239,169




CREDITORS

Amounts falling due after more than one year

17

(562,900

)

(624,139

)



PROVISIONS FOR LIABILITIES

21

(148,845

)

(48,653

)


NET ASSETS

7,242,355


6,566,377




CAPITAL AND RESERVES

Called up share capital

22

1,000


1,000



Share premium

23

75,922


75,922



Non-distributable revaluation reserve

23

412,481


100,047



Capital redemption reserve

23

1,400


1,400



Retained earnings

23

6,751,552


6,388,008



SHAREHOLDERS' FUNDS

7,242,355


6,566,377




The financial statements were approved by the Board of Directors and authorised for issue on 17 October 2024 and were signed on its behalf by:





R E Keith - Director




B M Keith - Director



BIRCHCLAIM LIMITED (REGISTERED NUMBER: 02584675)


COMPANY BALANCE SHEET

29 February 2024



2024

2023



Notes

£   

£   

£   

£   


FIXED ASSETS

Intangible assets

10

-


-



Tangible assets

11

1,827,657


1,842,428



Investments

12

35,332


35,332



Investment property

13

2,515,000


2,100,000



4,377,989


3,977,760




CURRENT ASSETS

Stocks

14

824,789


249,273



Debtors

15

1,763,076


1,690,923



Cash at bank

1,191,332


1,475,994



3,779,197


3,416,190



CREDITORS

Amounts falling due within one year

16

747,320


657,161



NET CURRENT ASSETS

3,031,877


2,759,029



TOTAL ASSETS LESS CURRENT LIABILITIES

7,409,866


6,736,789




CREDITORS

Amounts falling due after more than one year

17

(562,900

)

(624,139

)



PROVISIONS FOR LIABILITIES

21

(121,618

)

(19,052

)


NET ASSETS

6,725,348


6,093,598




CAPITAL AND RESERVES

Called up share capital

22

1,000


1,000



Share premium

23

34,332


34,332



Non-distributable revaluation reserve

23

412,481


100,047



Capital redemption reserve

23

700


700



Retained earnings

23

6,276,835


5,957,519



SHAREHOLDERS' FUNDS

6,725,348


6,093,598




Company's profit for the financial year

731,750


847,285




The financial statements were approved by the Board of Directors and authorised for issue on 17 October 2024 and were signed on its behalf by:





R E Keith - Director




B M Keith - Director



BIRCHCLAIM LIMITED (REGISTERED NUMBER: 02584675)


CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For The Year Ended 29 February 2024



Called up



share


Retained


Share


capital


earnings


premium

£   

£   

£   


Balance at 1 March 2022

1,000


5,505,664


75,922




Changes in equity

Total comprehensive income

-


982,344


-



Dividends

-


(100,000

)

-



Balance at 28 February 2023

1,000


6,388,008


75,922




Changes in equity

Total comprehensive income

-


463,544


-



Dividends

-


(100,000

)

-



Balance at 29 February 2024

1,000


6,751,552


75,922




Non-distributable


Capital



revaluation


redemption


Total


reserve


reserve


equity

£   

£   

£   


Balance at 1 March 2022

36,099


1,400


5,620,085




Changes in equity

Total comprehensive income

63,948


-


1,046,292



Dividends

-


-


(100,000

)


Balance at 28 February 2023

100,047


1,400


6,566,377




Changes in equity

Total comprehensive income

312,434


-


775,978



Dividends

-


-


(100,000

)


Balance at 29 February 2024

412,481


1,400


7,242,355




BIRCHCLAIM LIMITED (REGISTERED NUMBER: 02584675)


COMPANY STATEMENT OF CHANGES IN EQUITY

For The Year Ended 29 February 2024



Called up



share


Retained


Share


capital


earnings


premium

£   

£   

£   


Balance at 1 March 2022

1,000


5,274,182


34,332




Changes in equity

Profit for the year

-


847,285


-



Other comprehensive income

-


(63,948

)

-



Total comprehensive income

-


783,337


-



Dividends

-


(100,000

)

-



Balance at 28 February 2023

1,000


5,957,519


34,332




Changes in equity

Profit for the year

-


731,750


-



Other comprehensive income

-


(312,434

)

-



Total comprehensive income

-


419,316


-



Dividends

-


(100,000

)

-



Balance at 29 February 2024

1,000


6,276,835


34,332




Non-distributable


Capital



revaluation


redemption


Total


reserve


reserve


equity

£   

£   

£   


Balance at 1 March 2022

36,099


700


5,346,313




Changes in equity

Profit for the year

-


-


847,285



Other comprehensive income

63,948


-


-



Total comprehensive income

63,948


-


847,285



Dividends

-


-


(100,000

)


Balance at 28 February 2023

100,047


700


6,093,598




Changes in equity

Profit for the year

-


-


731,750



Other comprehensive income

312,434


-


-



Total comprehensive income

312,434


-


731,750



Dividends

-


-


(100,000

)


Balance at 29 February 2024

412,481


700


6,725,348




BIRCHCLAIM LIMITED (REGISTERED NUMBER: 02584675)


CONSOLIDATED CASH FLOW STATEMENT

For The Year Ended 29 February 2024



2024


2023


Notes

£   

£   


Cash flows from operating activities

Cash generated from operations

1

145,364


302,155



Tax paid

(157,686

)

(253,995

)


Net cash from operating activities

(12,322

)

48,160




Cash flows from investing activities

Purchase of tangible fixed assets

(139,317

)

(32,482

)


Sale of tangible fixed assets

14,159


822



Interest received

48,288


-



Net cash from investing activities

(76,870

)

(31,660

)



Cash flows from financing activities

New loans in year

40,000


297,395



Loan repayments in year

(120,359

)

(79,565

)


Amount introduced/withdrawn by directors

16,409


(39,135

)


Equity dividends paid

(100,000

)

(100,000

)


Net cash from financing activities

(163,950

)

78,695




(Decrease)/increase in cash and cash equivalents

(253,142

)

95,195



Cash and cash equivalents at beginning of year

2

1,890,129


1,794,934




Cash and cash equivalents at end of year

2

1,636,987


1,890,129




BIRCHCLAIM LIMITED (REGISTERED NUMBER: 02584675)


NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT

For The Year Ended 29 February 2024


1.

RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS


2024


2023

£   

£   



Profit before taxation

1,095,388


956,261




Depreciation charges

69,717


60,306




Profit on disposal of fixed assets

(8,172

)

(822

)



Gain on revaluation of fixed assets

(415,000

)

(83,000

)



Pension contributions

(59,750

)

(83,650

)



Profit on capitalised property stock

-


(8,025

)



Finance costs

39,525


48,490




Finance income

(48,288

)

-



673,420


889,560




Increase in stocks

(620,131

)

(316,641

)



Decrease/(increase) in trade and other debtors

44,619


(6,495

)



Increase/(decrease) in trade and other creditors

47,456


(264,269

)



Cash generated from operations

145,364


302,155




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 29 February 2024


29/2/24


1/3/23

£   

£   



Cash and cash equivalents

1,636,987


1,890,129




Year ended 28 February 2023


28/2/23


1/3/22

£   

£   



Cash and cash equivalents

1,890,129


1,794,934





3.

ANALYSIS OF CHANGES IN NET FUNDS/(DEBT)



At 1/3/23

Cash flow

At 29/2/24

£   

£   

£   



Net cash



Cash at bank and in hand

1,890,129


(253,142

)

1,636,987



1,890,129


(253,142

)

1,636,987




Debt


Debts falling due within 1 year

(552,193

)

(60,881

)

(613,074

)



Debts falling due after 1 year

(624,139

)

61,239


(562,900

)


(1,176,332

)

358


(1,175,974

)



Total

713,797


(252,784

)

461,013




BIRCHCLAIM LIMITED (REGISTERED NUMBER: 02584675)


NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

For The Year Ended 29 February 2024


1.

STATUTORY INFORMATION



Birchclaim Limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the General Information page.


2.

ACCOUNTING POLICIES



Basis of preparing the financial statements


These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention as modified by the revaluation of certain assets.  



Basis of consolidation


The consolidated financial statements present financial information about the group as a single economic entity through combining the financial statements of the company and all of its subsidiaries as identified in note 13. Intragroup balances and transactions are eliminated in full.



Significant judgements and estimates

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported for assets and liabilities as at the balance sheet date and the amounts reported for revenue and expenses during the year. However the nature of estimation means the actual outcomes could differ from those involving estimates. The Group constantly re-evaluates these significant factors and makes adjustments where facts and circumstances dictate.

The directors have made the following judgements and estimates deemed applicable to the financial statements:

Pensions
The Group operates a defined benefit pension scheme in the UK. This is a separate trustee administered fund holding the pension scheme assets to meet the long term pension liabilities, which requires estimates of the present value of projected future payments to all participants. The assumptions adopted for disclosure are appropriate to meet the requirements of Section 28 of FRS102. The assumptions have been set consistently with previous years, using the same market indices and adjustments unless there is a major plan event change. The assumptions include mortality projections, retirement rates, RPI and CPI inflation, discount rates and expected contributions which are all disclosed in the financial statements.

Stock
In determining the net realisable value of stocks, management take into account the most reliable evidence available at the dates estimates are made. Future realisation of the carrying amounts of stocks is affected by price changes in different market segments.The directors have used guidance from valuation tools and their knowledge of the industry when assessing the level of provisions required.


Turnover


Turnover represents amounts invoiced for goods and services net of VAT. Sale of motor vehicles are recognised on the earlier of full payment or delivery to the customer. Service and parts work are recognised on the completion of the agreed work.  Property sales are recognised on completion.



Intangible assets

Intangible assets are initially measured at cost. After initial recognition, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.


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

-

2% on cost


Long leasehold

-

15% on cost


Plant and machinery

-

at varying rates on cost


Motor vehicles

-

33% on cost



Investment property

Investment property is shown at most recent valuation. Any aggregate surplus or deficit arising from changes in fair value is recognised in profit or loss.


Stocks


Stocks are stated at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.  Cost includes all expenditure incurred in bringing each item to its present location and condition. Stock provisions are made by management based on the age and condition of stock and related costs using industry valuation tools and their knowledge of the business.



Raw material parts stock are valued at average cost, with work in progress and finished goods being valued at their direct cost.



Consignment stock is recognised in the balance sheet when the Group bears the risk and responsibilities of ownership, following shipment from the manufacturer holding centre.


BIRCHCLAIM LIMITED (REGISTERED NUMBER: 02584675)


NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued

For The Year Ended 29 February 2024


2.

ACCOUNTING POLICIES - continued



Financial instruments

Debtors and creditors with no stated interest rate and receivable or payable within one year are recorded at transaction price. Any losses arising from impairment are recognised in the profit and loss account.

Loans and borrowings are initially recognised at the transaction price including transaction costs. Subsequently, they are measured as amortised cost using the effective interest rate method, less impairment.


Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Consolidated 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.


Retirement benefits

The group operates both a defined contribution pension scheme and a defined benefit pension scheme.

Pension contributions for the defined contribution plan are charged against profits as they fall due.

A liability for the group's obligations under the defined benefit plan is recognised net of plan assets. A plan surplus is recognised only to the extent that it is able to recover the surplus either through reduced contributions in the future or through refunds from the plan. The change in the net defined benefit liability is recognised as the cost of the defined benefit plan during the period. Pension plan assets are measured at fair value and the defined benefit obligation is measured on an actuarial basis.

3.

TURNOVER



The turnover and profit before taxation are attributable to the one principal activity of the group.



An analysis of turnover by class of business is given below:



2024


2023

£   

£   



Vehicle sales

35,379,651


32,277,642




After sales and other income

3,948,830


3,316,032




Sale of properties (internal)

-


700,000




Sales of properties (external)

385,000


-



39,713,481


36,293,674





All turnover arose within the United Kingdom.


4.

EMPLOYEES AND DIRECTORS


2024


2023

£   

£   



Wages and salaries

2,357,864


2,242,540




Social security costs

253,247


326,531



2,611,111


2,569,071




BIRCHCLAIM LIMITED (REGISTERED NUMBER: 02584675)


NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued

For The Year Ended 29 February 2024


4.

EMPLOYEES AND DIRECTORS - continued



The average number of employees during the year was as follows:


2024


2023



Workshop

41


40




Sales

22


22




Administration

9


9



72


71





Social security costs include pension contributions of £38,288 (2023 - £36,109).



2024


2023

£   

£   



Directors' remuneration

117,271


117,327





The number of directors to whom retirement benefits were accruing was as follows:



Defined benefit schemes

3


3




5.

OPERATING PROFIT



The operating profit is stated after charging/(crediting):



2024


2023

£   

£   



Depreciation - owned assets

69,715


60,307




Profit on disposal of fixed assets

(8,172

)

(822

)



Auditors' remuneration

22,940


21,490




Other operating lease rentals  

56,403


55,200




6.

INTEREST PAYABLE AND SIMILAR EXPENSES



2024


2023

£   

£   



Bank loan interest

39,525


35,490




BIRCHCLAIM LIMITED (REGISTERED NUMBER: 02584675)


NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued

For The Year Ended 29 February 2024


7.

TAXATION



Analysis of the tax charge


The tax charge on the profit for the year was as follows:




2024


2023



£   

£   



Current tax:




UK corporation tax


159,468


157,686





Deferred tax


100,192


22,076




Tax on profit


259,660


179,762





UK corporation tax has been charged at 24.492%.



Reconciliation of total tax charged 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:




2024


2023



£   

£   



Profit before tax


1,095,388


956,261





Profit multiplied by the standard rate of corporation tax in the UK of 24.492% (2023 - 19%)


268,282


181,690




Effects of:




Expenses not deductible for tax purposes


375


3,552




Income not taxable for tax purposes


-


(15,770

)



Depreciation in excess of capital allowances


4,763


7,132




Allowable pension contributions


(14,634

)

(15,894

)



Deferred tax rate differential


2,034


19,052




Indexation allowance on investment property revaluation


(1,160

)

-




Total tax charge


259,660


179,762





In addition to the amount recognised in the income statement, the following amounts relating to tax have been recognised in the statement of other comprehensive income:



Deferred Tax



2024


2023



£   

£   



Arising on income and expenses recognised in other comprehensive income:





Deferred tax (cost)/benefit arising on actuarial gains/losses


-


(79.857

)



Total recognised in other comprehensive income


-


(79,857

)



8.

INDIVIDUAL INCOME STATEMENT



As permitted by Section 408 of the Companies Act 2006, the Income Statement of the parent company is not presented as part of these financial statements.



9.

DIVIDENDS


2024


2023

£   

£   



Ordinary 'A' shares of £1 each


Interim

100,000


100,000




BIRCHCLAIM LIMITED (REGISTERED NUMBER: 02584675)


NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued

For The Year Ended 29 February 2024


10.

INTANGIBLE FIXED ASSETS



Group


Goodwill

£   



COST


At 1 March 2023


and 29 February 2024

10,000




AMORTISATION


At 1 March 2023


and 29 February 2024

10,000




NET BOOK VALUE


At 29 February 2024

-




At 28 February 2023

-




11.

TANGIBLE FIXED ASSETS



Group


Freehold


Long


Plant and


Motor



property


leasehold


machinery


vehicles


Totals

£   

£   

£   

£   

£   



COST


At 1 March 2023

1,962,715


20,346


777,839


66,742


2,827,642




Additions

-


-


40,055


99,262


139,317




Disposals

-


-


-


(31,795

)

(31,795

)



At 29 February 2024

1,962,715


20,346


817,894


134,209


2,935,164




DEPRECIATION


At 1 March 2023

120,287


20,345


628,494


45,173


814,299




Charge for year

14,771


-


31,562


23,382


69,715




Eliminated on disposal

-


-


-


(25,808

)

(25,808

)



At 29 February 2024

135,058


20,345


660,056


42,747


858,206




NET BOOK VALUE


At 29 February 2024

1,827,657


1


157,838


91,462


2,076,958




At 28 February 2023

1,842,428


1


149,345


21,569


2,013,343






Company


Freehold


property

£   



COST


At 1 March 2023


and 29 February 2024

1,962,715




DEPRECIATION


At 1 March 2023

120,287




Charge for year

14,771




At 29 February 2024

135,058




NET BOOK VALUE


At 29 February 2024

1,827,657




At 28 February 2023

1,842,428




BIRCHCLAIM LIMITED (REGISTERED NUMBER: 02584675)


NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued

For The Year Ended 29 February 2024


12.

FIXED ASSET INVESTMENTS



The parent company's investments at the balance sheet date in the share capital of companies include the following:






Class of Shares


% Holding


Nature of Business





Keith Motors (Christchurch) Limited


Ordinary A


100.00


Motor dealers and engineers





The investment carrying value represents the cost of shares acquired in the wholly owned subsidiary company.



The registered office of the above subsidiary company is Lyndhurst Road, Christchurch, Dorset, BH23 4SB.


13.

INVESTMENT PROPERTY



Group and Company



Total




£




FAIR VALUE




At 1 March 2023


2,100,000




Additions


-




Revaluations


415,000




At 28 February 2024



2,515,000





NET BOOK VALUE




At 28 February 2024


2,515,000




At 28 February 2023


2,100,000





The investment property addition was transferred from stock at market value under normal market conditions.



Fair value at 29 February 2024 is represented by:

£   



Valuation in 2024

2,515,000





If investment property had not been revalued it would have been included at the following historical cost:


2024

2023


£   

£   



Cost

1,980,901


1,980,901





Investment property was valued on a fair value basis on 29 February 2024 by the directors .



The fair value of the investment properties has primarily been determined using a market approach, which has provided an indication of value by comparing the subject asset with similar assets for which price information is available.  Other factors were also considered when deriving fair value, these include, but are not limited to, rental yields and lease terms.


14.

STOCKS



Group


Company


2024

2023

2024

2023


£   

£   

£   

£   



Raw materials

154,549


121,526


-


-




Work-in-progress

20,474


31,218


-


-




Finished goods

4,541,846


4,519,510


-


-




Property development stock

824,789


249,273


824,789


249,273



5,541,658


4,921,527


824,789


249,273






BIRCHCLAIM LIMITED (REGISTERED NUMBER: 02584675)


NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued

For The Year Ended 29 February 2024


15.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR




Group


Company


2024

2023

2024

2023


£   

£   

£   

£   



Trade debtors

135,617


129,090


-


-




Amounts owed by group undertakings

-


-


1,747,516


1,690,923




Prepayments and other debtors

67,799


118,945


15,560


-



203,416


248,035


1,763,076


1,690,923




16.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR




Group


Company


2024

2023

2024

2023


£   

£   

£   

£   



Bank loans and overdrafts (see note 18)

62,524


58,052


62,524


58,052




Other loans (see note 18)

550,550


494,141


550,550


494,141




Vehicle stocking loans

1,875,037


1,899,102


-


-




Trade creditors

451,697


380,532


-


-




Corporation tax

159,468


157,686


75,928


46,470




Social security and other taxes

303,996


216,390


-


-




Other creditors

222,326


256,110


-


-




Accruals and deferred income

394,321


471,852


58,318


58,498



4,019,919


3,933,865


747,320


657,161




17.

CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR




Group


Company


2024

2023

2024

2023


£   

£   

£   

£   



Bank loans (see note 18)

562,900


624,139


562,900


624,139




18.


LOANS



An analysis of the maturity of loans is given below:



Group


Company


2024

2023

2024

2023


£   

£   

£   

£   



Amounts falling due within one year or on demand:



Bank loans

62,524


58,052


62,524


58,052




Directors' loans

510,550


494,141


510,550


494,141




Other loans

40,000


-


40,000


-



613,074


552,193


613,074


552,193




Amounts falling due between one and two years:



Bank loans - 1-2 years

64,837


61,240


64,837


61,240




Amounts falling due between two and five years:



Bank loans - 2-5 years

498,063


562,899


498,063


562,899




19.

LEASING AGREEMENTS



Minimum lease payments fall due as follows:



BIRCHCLAIM LIMITED (REGISTERED NUMBER: 02584675)


NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued

For The Year Ended 29 February 2024



Group


Non-cancellable operating leases


2024

2023


£   

£   



Within one year

58,079


51,773




Between one and five years

167,025


191,667



225,104


243,440




20.

SECURED DEBTS



The following secured debts are included within creditors:



Group


Company


2024

2023

2024

2023


£   

£   

£   

£   



Bank loans

625,424


682,191


625,424


682,191





Vehicle stocking loans amounting to £1,875,037 (2023 - £1,899,102) relate to new vehicles that the Group bears the risks and rewards of ownership. The vehicle stocking loans hold security over all new and used vehicle stock.



The Group's bank borrowing are secured by way of a debenture and a fixed and floating charge over the company's assets.


21.

PROVISIONS FOR LIABILITIES



Group


Company


2024

2023

2024

2023


£   

£   

£   

£   



Deferred tax

148,845


48,653


121,618


19,052





Group


Deferred



tax


£   



Balance at 1 March 2023

48,653




Charge to Income Statement during year

100,192




Balance at 29 February 2024

148,845





Company


Deferred



tax


£   



Balance at 1 March 2023

19,052




Charge to Income Statement during year

102,566




Balance at 29 February 2024

121,618





Deferred tax represents both capital allowances in advance of depreciation and potential capital gains tax on the sale of revalued investment property.


22.

CALLED UP SHARE CAPITAL



Allotted, issued and fully paid:


Number:

Class:

Nominal

2024

2023



value:

£   

£   



1,000

Ordinary 'A'

£1

1,000


1,000





BIRCHCLAIM LIMITED (REGISTERED NUMBER: 02584675)


NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued

For The Year Ended 29 February 2024


23.

RESERVES



Group


Non-distributable


Capital



Retained


Share


revaluation


redemption



earnings


premium


reserve


reserve


Totals

£   

£   

£   

£   

£   




At 1 March 2023

6,388,008


75,922


100,047


1,400


6,565,377




Profit for the year

835,728


835,728




Dividends

(100,000

)

(100,000

)



Revaluation surplus

(415,000

)

-


415,000


-


-




Deferred tax movement on

investment property revaluation

102,566


-


(102,566

)

-


-




Actuarial (loss) / gain

(59,750

)

-


-


-


(59,750

)



At 29 February 2024

6,751,552


75,922


412,481


1,400


7,241,355





Company


Non-distributable


Capital



Retained


Share


revaluation


redemption



earnings


premium


reserve


reserve


Totals

£   

£   

£   

£   

£   




At 1 March 2023

5,957,519


34,332


100,047


700


6,092,598




Profit for the year

731,750


731,750




Dividends

(100,000

)

(100,000

)



Revaluation surplus

(415,000

)

-


415,000


-


-




Deferred tax movement on

investment property revaluation

102,566


-


(102,566

)

-


-




At 29 February 2024

6,276,835


34,332


412,481


700


6,724,348





Retained earnings represents cumulative profits and losses net of dividends and other adjustments.



The share premium reserve records the amount above the nominal value received for shares sold, less transaction costs.



The non-distributable revaluation reserve represents the cumulate effect of revaluations of investment property, to assist with the identification of profits available for distribution.


The capital redemption reserve records the nominal value of shares repurchased by the company.


24.

EMPLOYEE BENEFIT OBLIGATIONS



The group operates a defined benefit plan in the UK.  The scheme is administered by an independent trustee.  The group funds the scheme by paying in contributions that are calculated at a level intended to balance the pensions liability with investment assets.  The contribution rates are set at the time of the full formal actuarial valuation.  This valuation was last performed as at 5 April 2022 with an update carried out at 29 February 2024 for FRS 102 reporting purposes by a qualified actuary.  The assumptions used at 29 February 2024 are outlined further in the note.  The current contribution rate is set at £71,700 per annum, with administration expenses generally met by the group and charged directly to the profit and loss as a business expense.



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  

-


11,000




Past service cost

-


-




Administrative expenses  

-


2,000



-


13,000





Actual return on plan assets

137,000


(325,300

)




BIRCHCLAIM LIMITED (REGISTERED NUMBER: 02584675)


NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued

For The Year Ended 29 February 2024


24.

EMPLOYEE BENEFIT OBLIGATIONS - continued










Changes in the present value of the defined benefit obligation are as follows:



Defined benefit



pension plans


2024

2023


£   

£   



Opening defined benefit obligation

2,801,000


4,180,000




Interest cost

137,000


107,000




Administrative expenses

-


2,000




Net benefit outgoings

(113,000

)

(104,000

)



Remeasurements:


Actuarial (gains)/losses from changes in demographic

assumptions

(93,000

)

(1,438,000

)



Experience gains and losses arising on plan liabilities

-


54,000



2,732,000


2,801,000





Changes in the fair value of scheme assets are as follows:



Defined benefit



pension plans


2024

2023


£   

£   



Opening fair value of scheme assets

2,801,000


3,759,700




Contributions by employer

59,750


83,650




Interest income

137,000


96,000




Benefits paid

(113,000

)

(104,000

)



Effect of asset ceiling

(269,750

)

(306,700

)



Return on plan assets (excluding interest income)

117,000


(727,650

)


2,732,000


2,801,000





The amounts recognised in other comprehensive income are as follows:



Defined benefit



pension plans


2024

2023


£   

£   



Actuarial (gains)/losses from changes in demographic

assumptions

93,000


1,438,000




Experience gains and losses arising on plan liabilities

-


(54,000

)



Return on plan assets (excluding interest income)

117,000


(727,650

)



Effect of asset ceiling  

-


(306,700

)


210,000


349,650





The major categories of scheme assets as a percentage of total scheme assets are as follows:



Defined benefit



pension plans


2024

2023



Gilts, Bonds and Cash

100%

100%


100.00%

100.00%



BIRCHCLAIM LIMITED (REGISTERED NUMBER: 02584675)


NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - continued

For The Year Ended 29 February 2024


24.

EMPLOYEE BENEFIT OBLIGATIONS - continued



Principal actuarial assumptions at the balance sheet date (expressed as weighted averages):


2024

2023



Discount rate

5.20%

5.00%



Inflation (RPI)

3.20%

3.20%



Inflation (CPI)

2.70%

2.70%



5% per annum CPI  

2.70%

2.70%



5% per annum RPI

3.00%

3.00%



3% per annum RPI  

2.30%

2.30%



2.5% per annum RPI

2.00%

2.00%




The mortality assumptions adopted at 29 February 2024 imply the following life expectancies:



Life expectancy at age 65(Years

)



Male retiring in 2024


21.8




Female retiring in 2024


23.0




Male retiring in 2044


23.9




Female retiring in 2044


25.4





The best estimate of contributions to be paid by the group to the plan for the period commencing 1 March 2024 is £71,700.


25.

CONTINGENT LIABILITIES



The parent company has provided a cross guarantee with Barclays Bank in respect of the overdraft facility held by the subsidiary undertaking.


26.

RELATED PARTY DISCLOSURES



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.



Transactions between group entities which have been eliminated on consolidation are not disclosed within the financial statements.



Key management personnel of the entity or its parent (in the aggregate)

2024

2023


£   

£   



Dividends  

100,000


100,000




Amount due to related party  

510,550


494,141





Key management are those persons who have the authority and responsibility for planning, directing and controlling the activities of the company, directly or indirectly, including the directors.



During the year, a total of key management personnel compensation of £ 973,436 (2023 - £ 759,536 ) was paid.


27.

ULTIMATE CONTROLLING PARTY



There is no controlling party.