Company registration number 03414086 (England and Wales)
L.M. JEWELLERY LIMITED
ANNUAL REPORT AND AUDITED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 29 FEBRUARY 2024
L.M. JEWELLERY LIMITED
COMPANY INFORMATION
Director
S. Lousky
Company number
03414086
Registered office
5 Broadbent Close
Highgate
London
N6 5JW
Senior Statutory Auditor
Vijaya Sena Herath
Auditors
Herath Associates Limited
Chartered Certified Accountants and Statutory Auditors
1 Chiltern Business Centre
63-65 Woodside Road
Amersham
Buckinghamshire
HP6 6AA
Accountants
Fox Sharer LLP
5 Broadbent Close
Highgate
London
N6 5JW
L.M. JEWELLERY LIMITED
CONTENTS
Page
Strategic report
1
Director's report
2
Director's responsibilities statement
3
Independent auditor's report
4 - 6
Statement of comprehensive income
7
Balance sheet
8
Statement of changes in equity
9
Statement of cash flows
10
Notes to the financial statements
11 - 19
L.M. JEWELLERY LIMITED
STRATEGIC REPORT
FOR THE PERIOD ENDED 29 FEBRUARY 2024
- 1 -

The director presents his strategic report for the Period to 29 February 2024.

Review of the business

The company posted positive results for the Period to 29 February 2024.

 

The company's results are summarised in the Profit and Loss Account and the Key Performance Indicators during the year were as follows:

 

 

 

 

2024

(14 months)

 

2022

(12 months)

 

Change

 

 

 

£

 

£

 

%

Turnover

 

 

14,842,950

 

18,467,871

 

(20)

Operating Profit

 

 

2,061,370

 

4,221,706

 

(51)

Net Profit

 

 

2,285,341

 

3,336,278

 

(32)

 

Principal risks and uncertainties

The Board has identified the following to be the most significant risks and uncertainties that may impact the company's ability to achieve its strategic and operational goals.

 

Economic, Currency and Political Risks

Any decline in consumer spending in the UK could have a material adverse impact on the company's business. Adverse macro economic changes and currency fluctuations could also have a negative impact on the business. The company makes an element of its sales and purchases in foreign currencies. On an ongoing basis the director monitors the company's currency risk exposure in order to ensure that it remains at an acceptable level. Continuing Brexit uncertainty may also have an adverse impact on the UK economy; however, the company's main suppliers are situated outside the European Union and sales are predominantly to UK customers so this risk is mitigated.

 

Credit Risk Exposure

Credit risk predominantly arises from trade receivables. Although external credit ratings are not obtained for customers, the company's policy is to assess the credit quality of each customer internally before accepting any terms of trade. Internal procedures are performed taking into account their financial position as well as their reputation within the industry and past experience. In addition, receivable balances are monitored on an ongoing basis with the result that the Company's exposure to bad debts is not significant. The company's maximum exposure to credit risk relating to its financial assets is equivalent to their carrying value. All financial assets have a fair value which is equal to their carrying value.

On behalf of the board

S. Lousky
Director
26 November 2024
L.M. JEWELLERY LIMITED
DIRECTOR'S REPORT
FOR THE PERIOD ENDED 29 FEBRUARY 2024
- 2 -

The director presents his annual report and financial statements for the Period ended 29 February 2024.

 

The comparative figures for the year ended 31 December 2022 are not directly comparable with the current period figures.

Principal activities

The principal activity of the company continued to be that of dealing in jewellery.

Results and dividends

Interim dividends were paid amounting to £127,650 (2022: £83,000). The director does not recommend payment of a final dividend.

Director

The director who held office during the Period and up to the date of signature of the financial statements was as follows:

S. Lousky
Political donations

The company made no political donations in the current year.

Auditor

The auditor, Herath Associates Limited, will be proposed for reappointment at the forthcoming Annual General Meeting.

Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.

Medium-sized companies exemption

This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.

On behalf of the board
S. Lousky
Director
26 November 2024
L.M. JEWELLERY LIMITED
DIRECTOR'S RESPONSIBILITIES STATEMENT
FOR THE PERIOD ENDED 29 FEBRUARY 2024
- 3 -

The director is responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless he is 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 director is required to:

 

 

The director is 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. He is 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.

L.M. JEWELLERY LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF L.M. JEWELLERY LIMITED
- 4 -
Opinion

We have audited the financial statements of L.M. Jewellery Limited (the 'company') for the Period ended 29 February 2024 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including 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:

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 Auditor's 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 director's 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 director with respect to going concern are described in the relevant sections of this report.

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The director is responsible for the other information contained within the annual report. 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. 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 course of 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 our audit:

L.M. JEWELLERY LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF L.M. JEWELLERY LIMITED
- 5 -
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 and the director's report. We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

 

Responsibilities of director

As explained more fully in the director's responsibilities statement, the director is 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 director determines is 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 director is 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 director either intends to liquidate the company or to cease operations, or has no realistic alternative but to do so.

Auditor's 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 an auditor's report 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.

 

We obtained an understanding of the legal and regulatory frameworks that are applicable to the company and determined that the most significant are FRS 102 and Companies Act 2006 as these are directly relevant to specific assertions in the financial statements. We understood how the company is complying with those frameworks by making enquiries of management and those responsible for legal and compliance procedures. We corroborated our enquiries through our audit procedures performed in the course of the audit. We assessed the susceptibility of the company's financial statements to material misstatement, including how fraud might occur by meeting with the director to understand where he considered there was susceptibility to fraud. In addition, we observed and understood the oversight of those charged with governance over the financial reporting process, the culture of honesty and ethical behaviour and whether a strong emphasis is placed on fraud prevention and fraud deterrence. Based on this understanding we designed our audit procedures to identify non-compliance with such laws and regulations. Our audit procedures involved journal entry testing with a focus on manual journals, indicating large or unusual transactions based on our understanding of the business.

 

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation.  This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

L.M. JEWELLERY LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF L.M. JEWELLERY LIMITED
- 6 -

Other matters

The comparative information in the Financial Statements is derived from the company's prior period Financial Statements which were for a 12 months period. The current year Financial Statements are for a 14 months period.

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 an auditor's report 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.

Vijaya Sena Herath
Senior Statutory Auditor
For and on behalf of Herath Associates Limited
26 November 2024
2024-11-26
Chartered Certified Accountants
Statutory Auditor
1 Chiltern Business Centre
63-65 Woodside Road
Amersham
Buckinghamshire
HP6 6AA
L.M. JEWELLERY LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED 29 FEBRUARY 2024
- 7 -
Period
Year
ended
ended
29 February
31 December
2024
2022
Notes
£
£
Turnover
14,842,950
18,467,871
Cost of sales
(11,777,566)
(13,156,393)
Gross profit
3,065,384
5,311,478
Administrative expenses
(1,004,014)
(1,089,772)
Operating profit
2,061,370
4,221,706
Interest receivable and similar income
149,503
5,194
Interest payable and similar expenses
(23,761)
(11,891)
Fair value changes to investments
4
668,826
(92,626)
Profit before taxation
2,855,938
4,122,383
Tax on profit
5
(570,597)
(786,105)
Profit for the financial Period
2,285,341
3,336,278

The profit and loss account has been prepared on the basis that all operations are continuing operations.

L.M. JEWELLERY LIMITED
BALANCE SHEET
AS AT
29 FEBRUARY 2024
29 February 2024
- 8 -
29 February 2024
31 December 2022
Notes
£
£
£
£
Fixed assets
Tangible assets
6
70,390
91,226
Investments
7
8,568,902
2,232,534
8,639,292
2,323,760
Current assets
Stocks
2,157,639
1,362,204
Debtors
9
2,188,379
2,788,491
Cash at bank and in hand
2,640,247
8,095,345
6,986,265
12,246,040
Creditors: amounts falling due within one year
10
(2,327,203)
(3,426,644)
Net current assets
4,659,062
8,819,396
Total assets less current liabilities
13,298,354
11,143,156
Provisions for liabilities
(15,998)
(18,491)
Net assets
13,282,356
11,124,665
Capital and reserves
Called up share capital
2
2
Capital redemption reserve
3
3
Profit and loss reserves
13,282,351
11,124,660
Total equity
13,282,356
11,124,665

These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.

The financial statements were approved and signed by the director and authorised for issue on 26 November 2024
S. Lousky
Director
Company registration number 03414086 (England and Wales)
L.M. JEWELLERY LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 29 FEBRUARY 2024
- 9 -
Share capital
Capital redemption reserve
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 January 2022
2
3
7,871,382
7,871,387
Year ended 31 December 2022:
Profit and total comprehensive income
-
-
3,336,278
3,336,278
Dividends
-
-
(83,000)
(83,000)
Balance at 31 December 2022
2
3
11,124,660
11,124,665
Period ended 29 February 2024:
Profit and total comprehensive income
-
-
2,285,341
2,285,341
Dividends
-
-
(127,650)
(127,650)
Balance at 29 February 2024
2
3
13,282,351
13,282,356
L.M. JEWELLERY LIMITED
STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED 29 FEBRUARY 2024
- 10 -
2024
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
13
1,572,974
4,068,419
Interest paid
(23,761)
(11,891)
Income taxes paid
(1,266,154)
(1,088,264)
Net cash inflow from operating activities
283,059
2,968,264
Investing activities
Purchase of tangible fixed assets
(4,417)
(51,922)
Proceeds from disposal of tangible fixed assets
1,920
-
0
Purchase of subsidiaries
(2)
-
0
Purchase of investments
(5,869,139)
-
0
Proceeds from disposal of investments
201,599
(2,325,160)
Loans made
(89,971)
-
0
Interest received
149,503
5,194
Net cash used in investing activities
(5,610,507)
(2,371,888)
Financing activities
Dividends paid
(127,650)
(83,000)
Net cash used in financing activities
(127,650)
(83,000)
Net (decrease)/increase in cash and cash equivalents
(5,455,098)
513,376
Cash and cash equivalents at beginning of Period
8,095,345
7,581,969
Cash and cash equivalents at end of Period
2,640,247
8,095,345
L.M. JEWELLERY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 29 FEBRUARY 2024
- 11 -
1
Accounting policies
Company information

L.M. Jewellery Limited is a private company limited by shares incorporated in England and Wales. The registered office is 5 Broadbent Close, Highgate, London, N6 5JW.

1.1
Accounting convention

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

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention, [modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value]. The principal accounting policies adopted are set out below.

1.2
Turnover

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

 

When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

1.3
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Leasehold land and buildings
Straight line over period of lease
Fixtures and fittings
25% Reducing balance
Computer equipment
25% Reducing balance
Motor vehicles
25% Reducing balance

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

1.4
Fixed asset investments

Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.

L.M. JEWELLERY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 29 FEBRUARY 2024
1
Accounting policies
(Continued)
- 12 -

A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The company considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.

Entities in which the company has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

1.5
Impairment of fixed assets

At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

1.6
Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

 

Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

1.7
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

L.M. JEWELLERY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 29 FEBRUARY 2024
1
Accounting policies
(Continued)
- 13 -
1.8
Financial instruments

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

 

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Classification of financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

L.M. JEWELLERY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 29 FEBRUARY 2024
1
Accounting policies
(Continued)
- 14 -
Basic financial liabilities

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Other financial liabilities

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

 

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Derecognition of financial liabilities

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

1.9
Equity instruments

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

1.10
Taxation

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

Current tax

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

L.M. JEWELLERY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 29 FEBRUARY 2024
1
Accounting policies
(Continued)
- 15 -
Deferred tax

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

 

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

1.11
Employee benefits

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

 

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

 

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.12
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.13
Leases

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.

1.14
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

2
Judgements and key sources of estimation uncertainty

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

 

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

L.M. JEWELLERY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 29 FEBRUARY 2024
- 16 -
3
Employees

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

2024
2022
Number
Number
8
11

Their aggregate remuneration comprised:

2024
2022
£
£
Wages and salaries
374,661
506,018
Social security costs
36,364
57,178
Pension costs
6,931
8,332
417,956
571,528
4
Fair value changes to investments
2024
2022
£
£
Fair value gains/(losses)
Gain/(loss) on financial assets held at fair value through profit or loss
467,227
(92,626)
5
Taxation
2024
2022
£
£
Current tax
UK corporation tax on profits for the current period
573,090
776,087
Adjustments in respect of prior periods
-
0
(386)
Total current tax
573,090
775,701
Deferred tax
Origination and reversal of timing differences
(2,493)
10,404
Total tax charge
570,597
786,105
L.M. JEWELLERY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 29 FEBRUARY 2024
- 17 -
6
Tangible fixed assets
Land and buildings
Plant and machinery etc
Total
£
£
£
Cost
At 1 January 2023
20,029
193,019
213,048
Additions
-
0
4,417
4,417
Disposals
-
0
(1,920)
(1,920)
At 29 February 2024
20,029
195,516
215,545
Depreciation and impairment
At 1 January 2023
11,628
110,194
121,822
Depreciation charged in the Period
2,003
21,330
23,333
At 29 February 2024
13,631
131,524
145,155
Carrying amount
At 29 February 2024
6,398
63,992
70,390
At 31 December 2022
8,401
82,825
91,226
7
Fixed asset investments
2024
2022
£
£
Shares in group undertakings and participating interests
2
-
0
Other investments other than loans
8,568,900
2,232,534
8,568,902
2,232,534
Fixed asset investments revalued

Investments are included at their market value at the end of the period. The historical cost of investments is £8,190,340

L.M. JEWELLERY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 29 FEBRUARY 2024
7
Fixed asset investments
(Continued)
- 18 -
Movements in fixed asset investments
Shares in subsidiaries
Other investments
Total
£
£
£
Cost or valuation
At 1 January 2023
-
2,232,534
2,232,534
Additions
2
-
2
Valuation changes
-
6,336,366
6,336,366
At 29 February 2024
2
8,568,900
8,568,902
Carrying amount
At 29 February 2024
2
8,568,900
8,568,902
At 31 December 2022
-
2,232,534
2,232,534
8
Financial instruments
2024
2022
£
£
Carrying amount of financial assets
Instruments measured at fair value through profit or loss
8,568,900
2,232,534
9
Debtors
2024
2022
Amounts falling due within one year:
£
£
Trade debtors
1,684,793
2,667,584
Amounts owed by group undertakings
600
-
0
Other debtors
502,986
120,907
2,188,379
2,788,491
10
Creditors: amounts falling due within one year
2024
2022
£
£
Trade creditors
2,303,037
2,326,577
Taxation and social security
10,486
572,641
Other creditors
13,680
527,426
2,327,203
3,426,644
L.M. JEWELLERY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 29 FEBRUARY 2024
- 19 -
11
Operating lease commitments
Lessee

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, as follows:

2024
2022
£
£
130,000
176,667
12
Directors' transactions

During the period advances of £89,970 have been made to the directors. The balance is repayable on demand and subject to interest at 2.25% p.a.

Dividends totalling £127,650 (2022: £83,000) were paid in the Period in respect of shares held by the company's directors.

13
Cash generated from operations
2024
2022
£
£
Profit for the Period after tax
2,285,340
3,336,278
Adjustments for:
Taxation charged
570,597
786,105
Finance costs
23,761
11,891
Investment income
(149,503)
(5,194)
Depreciation and impairment of tangible fixed assets
23,333
29,611
Other gains and losses
(668,826)
92,626
Movements in working capital:
(Increase)/decrease in stocks
(795,434)
130,919
Decrease in debtors
829,925
155,417
Decrease in creditors
(546,219)
(469,234)
Cash generated from operations
1,572,974
4,068,419
14
Analysis of changes in net funds
1 January 2023
Cash flows
29 February 2024
£
£
£
Cash at bank and in hand
8,095,345
(5,455,098)
2,640,247
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