Company registration number 05996643 (England and Wales)
LGSF LTD
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
LGSF LTD
COMPANY INFORMATION
Directors
Mrs S Cade
Mrs R Cade
Mr I Cade
Mr C F Cade
Mr C L Cade
Mrs J R Cade
Mr D Beattie
Company number
05996643
Registered office
The Gateway
Dunslow Road
Eastfield
Scarborough
North Yorkshire
YO11 3UT
Auditor
Azets Audit Services Limited
Triune Court
Monks Cross Drive
York
YO32 9GZ
LGSF LTD
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Statement of comprehensive income
8
Balance sheet
9
Statement of changes in equity
10
Statement of cash flows
11
Notes to the financial statements
12 - 25
LGSF LTD
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2024
- 1 -

The directors present the strategic report for the year ended 31 March 2024.

Review of the business

The company is predominantly involved with the manufacture of hot and cold rolled structural steelwork for use within the construction industry. The customer base includes but is not limited to subcontractors, main contractors and offsite manufacturers representing a wide range of diversified customers.

LGSF Ltd is a family owned, private limited company, incorporated and domiciled in the United Kingdom. The address of the registered office is given in the company information page of this annual report.

As expected, turnover fell by 44% for the year ended 31 March 2024 compared to the prior financial year due to the insolvency of a major customer. The business has taken steps within the period to reduce overhead costs to suit the reduced levels of turnover, whilst retaining the ability to re-grow the business as and when additional opportunities arise. Overall, the directors are satisfied that gross profit margins have increased in the period, the customer base has increased and that the benefit of the reduced overheads will see a return to more acceptable level of profitability.

During the period the Company continued to invest in upgrading rolling lines to provide additional capacity and also invested in equipment to increase productivity within the production facility.

The company’s balance sheet continues to show a strong position with net assets amounting to £3,896,508. The company has planned for challenging trading conditions in the forthcoming year and the Directors believe the company is in the best possible position to “weather” the external challenges being presented.

Principal risks and uncertainties

The principal risks and uncertainties facing the Company remain the uncertainty in the construction markets in which we predominantly operate. These risks are managed through the development of strong relationships across the customer base and supply chain and a drive to grow the business into new, non-construction related markets.

Evaluation of risks, exposure and consequential mitigation are regularly considered by the senior management team within our internal framework which includes commercial, operational, and financial aspects. We review our customer base and supply chains to mitigate any dependencies therein.

The business experienced a substantial impact due to the failure of a major customer in the financial year covered by these accounts, but has responded by significantly expanding on the remaining customer base to mitigate the effects of any future customer failures, and will continue to do so for the foreseeable future.

2024 was a challenging year for manufacturing companies, the Cost-of-Living crisis within the economy has impacted substantially on demand, especially in the construction sector, however falling materials prices have offset the labour cost increases within the period. The company has managed these risks by close collaboration with our supply chain, ensuring material requirements are reserved at a fixed price for every project undertaken and by a focus on driving productivity improvement within all manufacturing processes.

The Company is subject to the usual risks in respect trade creditors and work in progress. In order to manage credit risk, the company places, and continuously monitors, credit limits on customers based upon payment history and third-party credit references. Works in progress are reviewed monthly to ensure projects are achieving expected outcomes.

Key performance indicators

In addition to the key financial performance indicators included in these financial statements, the directors monitor a number of key indicators such as project and operational performance, customer and employee’s satisfaction, sales pipeline and cash management on a regular basis.

LGSF LTD
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 2 -

On behalf of the board

Mr I Cade
Director
21 November 2024
LGSF LTD
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2024
- 3 -

The directors present their annual report and financial statements for the year ended 31 March 2024.

Principal activities

The principal activity of the company continued to be that of the manufacture of metal structures.

Results and dividends

The results for the year are set out on page 8.

Ordinary interim dividends were paid amounting to £1,090,831. The directors do not recommend payment of a final dividend.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

Mrs S Cade
Mrs R Cade
Mr I Cade
Mr C F Cade
Mr C L Cade
Mrs J R Cade
Mr D Beattie
Auditor

The auditor, Azets Audit Services Limited, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

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.

On behalf of the board
Mr I Cade
Director
21 November 2024
LGSF LTD
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 MARCH 2024
- 4 -

The directors are responsible for preparing the annual report 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 of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

 

 

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

LGSF LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF LGSF LTD
- 5 -
Opinion

We have audited the financial statements of LGSF LTD (the 'company') for the year ended 31 March 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 directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

 

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

 

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are 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:

LGSF LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF LGSF LTD
- 6 -
Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' 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 directors

As explained more fully in the directors' responsibilities statement, 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 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 directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

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.

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.

LGSF LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF LGSF LTD
- 7 -

Extent to which the audit was considered capable of detecting irregularities, including fraud

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above and on the Financial Reporting Council’s website, to detect material misstatements in respect of irregularities, including fraud.

 

We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework. Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.

 

In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included:

 

 

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 of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

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.

Chris Woodroffe
Senior Statutory Auditor
For and on behalf of Azets Audit Services Limited
21 November 2024
2024-11-21
Chartered Accountants
Statutory Auditor
Triune Court
Monks Cross Drive
York
YO32 9GZ
LGSF LTD
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2024
- 8 -
2024
2023
Notes
£
£
Turnover
3
10,735,918
19,232,051
Cost of sales
(6,937,656)
(14,161,287)
Gross profit
3,798,262
5,070,764
Administrative expenses
(3,833,744)
(2,900,048)
Other operating income
19,997
20,795
Operating (loss)/profit
4
(15,485)
2,191,511
Interest receivable and similar income
6
12,721
-
0
Interest payable and similar expenses
7
(17,242)
(7,030)
(Loss)/profit before taxation
(20,006)
2,184,481
Tax on (loss)/profit
8
106,514
(437,883)
Profit for the financial year
86,508
1,746,598

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

LGSF LTD
BALANCE SHEET
AS AT
31 MARCH 2024
31 March 2024
- 9 -
2024
2023
Notes
£
£
£
£
Fixed assets
Goodwill
10
25,000
30,000
Tangible assets
11
1,446,403
1,173,891
Investment property
12
300,000
300,000
1,771,403
1,503,891
Current assets
Stocks
13
371,814
544,933
Debtors
14
2,470,701
4,402,480
Cash at bank and in hand
1,425,342
2,820,648
4,267,857
7,768,061
Creditors: amounts falling due within one year
16
(1,830,373)
(4,136,742)
Net current assets
2,437,484
3,631,319
Total assets less current liabilities
4,208,887
5,135,210
Provisions for liabilities
Deferred tax liability
17
312,379
234,379
(312,379)
(234,379)
Net assets
3,896,508
4,900,831
Capital and reserves
Called up share capital
19
7
7
Profit and loss reserves
3,896,501
4,900,824
Total equity
3,896,508
4,900,831
The financial statements were approved by the board of directors and authorised for issue on 21 November 2024 and are signed on its behalf by:
Mr I Cade
Director
Company Registration No. 05996643
LGSF LTD
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2024
- 10 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 April 2022
7
4,045,326
4,045,333
Year ended 31 March 2023:
Profit and total comprehensive income for the year
-
1,746,598
1,746,598
Dividends
9
-
(891,100)
(891,100)
Balance at 31 March 2023
7
4,900,824
4,900,831
Year ended 31 March 2024:
Profit and total comprehensive income for the year
-
86,508
86,508
Dividends
9
-
(1,090,831)
(1,090,831)
Balance at 31 March 2024
7
3,896,501
3,896,508
LGSF LTD
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2024
- 11 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
24
143,798
3,315,273
Interest paid
(17,242)
(7,030)
Income taxes paid
(290,977)
(231,232)
Net cash (outflow)/inflow from operating activities
(164,421)
3,077,011
Investing activities
Purchase of tangible fixed assets
(507,617)
(330,141)
Interest received
12,721
-
0
Net cash used in investing activities
(494,896)
(330,141)
Financing activities
Proceeds from new bank loans
354,842
-
0
Repayment of bank loans
-
0
(229,167)
Dividends paid
(1,090,831)
(891,100)
Net cash used in financing activities
(735,989)
(1,120,267)
Net (decrease)/increase in cash and cash equivalents
(1,395,306)
1,626,603
Cash and cash equivalents at beginning of year
2,820,648
1,194,045
Cash and cash equivalents at end of year
1,425,342
2,820,648
LGSF LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
- 12 -
1
Accounting policies
Company information

LGSF LTD is a private company limited by shares incorporated in England and Wales. The registered office is The Gateway, Dunslow Road, Eastfield, Scarborough, North Yorkshire, YO11 3UT.

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.

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 £1.

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

1.2
Going concern

Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.3
Turnover

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

Revenue from 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.

Revenue from contracts for the supply of goods and services is recognised by reference to the stage of completion, when costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs.  Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.

1.4
Intangible fixed assets - goodwill

Goodwill represents the excess of the cost of acquisition of unincorporated businesses over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is fifteen years.

 

For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.

1.5
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.

LGSF LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 13 -

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:

Freehold buildings
2-10% Straight line
Plant and equipment
10-20% Straight line
Computers
25% Straight line
Motor vehicles
25% Straight line

Freehold land is not depreciated.

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.

1.6
Investment property

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

1.7
Impairment of fixed assets

At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible 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.

1.8
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.

LGSF LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 14 -

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.

1.9
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.

1.10
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.

LGSF LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 15 -
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.

Basic financial liabilities

Basic financial liabilities, including creditors, 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.

1.11
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.

1.12
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.

LGSF LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 16 -
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.

1.13
Employee benefits

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

 

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

 

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

1.14
Retirement benefits

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

1.15
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.

Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.

1.16
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.

LGSF LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 17 -
2
Judgements and key sources of estimation uncertainty

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

 

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

Critical judgements

The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.

Depreciation

The depreciation policy has been set according to managements experience of the useful lives of a typical asset in each category, something which is reviewed annually. It is not considered practical to use a per unit basis to allocate depreciation without undue cost and therefore amounts are charged annually. The depreciation charge during the year was £235,105 (2023 - £205,591) which the directors feel is a fair reflection of the benefits derived from the consumption of the tangible fixed assets in use during the period.

Long term contracts

Where the outcome of a construction contract can be estimated reliably, revenue and costs are recognised by reference to the stage of completion of the contract activity at the reporting end date. Variations in contract work, claims and incentive payments are included to the extent that the amount can be measured reliably and its receipt is considered probable.

 

When it is probable that total contract costs will exceed total contract turnover, the expected loss is recognised as an expense immediately.

 

Where the outcome of a construction contract cannot be estimated reliably, contract costs are recognised as expenses in the period in which they are incurred and contract revenue is recognised to the extent of contract costs incurred where it is probable that they will be recoverable.

Investment property

The company holds investment properties at their fair value, which approximates to the open market value of the property on an existing use basis. The company obtains professional valuations to determine this estimate when considered necessary. The directors believe the current valuation to be materially correct.

Stock

Stock consists of rolled steel and ancillaries and is valued by considering the current market value. Stock is recognised at the lower of cost or net realisable value. No provision is deemed necessary against these items because they are used by the company in its day to day operations.

3
Turnover and other revenue

Turnover is wholly attributable to the principal activity of the company.

 

All turnover arose within the United Kingdom.

LGSF LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
3
Turnover and other revenue
(Continued)
- 18 -
2024
2023
£
£
Other revenue
Interest income
12,721
-
4
Operating (loss)/profit
2024
2023
Operating (loss)/profit for the year is stated after charging:
£
£
Fees payable to the company's auditor for the audit of the company's financial statements
17,600
16,800
Depreciation of owned tangible fixed assets
235,105
205,591
Amortisation of intangible assets
5,000
5,000
Operating lease charges
268,337
259,460
5
Employees

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

2024
2023
Number
Number
Directors
6
6
Administrative
16
18
Production
65
88
Total
87
112

Their aggregate remuneration comprised:

2024
2023
£
£
Wages and salaries
2,812,098
3,542,085
Social security costs
257,542
323,263
Pension costs
238,147
635,605
3,307,787
4,500,953
6
Interest receivable and similar income
2024
2023
£
£
Interest income
Other interest income
12,721
-
0
LGSF LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 19 -
7
Interest payable and similar expenses
2024
2023
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
17,242
7,030
8
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
-
0
399,491
Adjustments in respect of prior periods
(108,514)
(358)
Total current tax
(108,514)
399,133
Deferred tax
Origination and reversal of timing differences
2,000
38,750
Total tax (credit)/charge
(106,514)
437,883

The actual (credit)/charge for the year can be reconciled to the expected (credit)/charge for the year based on the profit or loss and the standard rate of tax as follows:

2024
2023
£
£
(Loss)/profit before taxation
(20,006)
2,184,481
Expected tax (credit)/charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 19.00%)
(5,002)
415,051
Tax effect of expenses that are not deductible in determining taxable profit
4,318
5,756
Research and development tax credit
(108,514)
-
0
Under/(over) provided in prior years
-
0
(358)
Other
2,684
17,434
Taxation (credit)/charge for the year
(106,514)
437,883
9
Dividends
2024
2023
£
£
Interim paid
1,090,831
891,100
LGSF LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 20 -
10
Intangible fixed assets
Goodwill
£
Cost
At 1 April 2023 and 31 March 2024
75,000
Amortisation and impairment
At 1 April 2023
45,000
Amortisation charged for the year
5,000
At 31 March 2024
50,000
Carrying amount
At 31 March 2024
25,000
At 31 March 2023
30,000
11
Tangible fixed assets
Freehold buildings
Plant and equipment
Computers
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 April 2023
308,220
2,790,618
54,729
199,847
3,353,414
Additions
-
0
478,632
6,485
22,500
507,617
Disposals
-
0
-
0
-
0
(13,500)
(13,500)
At 31 March 2024
308,220
3,269,250
61,214
208,847
3,847,531
Depreciation and impairment
At 1 April 2023
64,852
1,973,025
28,965
112,681
2,179,523
Depreciation charged in the year
18,851
171,606
11,264
33,384
235,105
Eliminated in respect of disposals
-
0
-
0
-
0
(13,500)
(13,500)
At 31 March 2024
83,703
2,144,631
40,229
132,565
2,401,128
Carrying amount
At 31 March 2024
224,517
1,124,619
20,985
76,282
1,446,403
At 31 March 2023
243,368
817,593
25,764
87,166
1,173,891

Included within land and buildings is land valued at £100,000 (2023 - £100,000) which is not depreciated.

12
Investment property
2024
£
Fair value
At 1 April 2023 and 31 March 2024
300,000
LGSF LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
12
Investment property
(Continued)
- 21 -

Investment property comprises a property owned to acquire rentals. The fair value of the investment property has been arrived at on the basis of a valuation. The valuation was carried out on 25th November 2022 by Andrew Cowen Estate Agents; which is not a connected company. The valuations were made on an open market value basis by reference to market evidence of transaction prices for similar properties. The directors believe that this valuation was representative of the fair value of the property at the year end.

If investment properties were stated on an historical cost basis rather than a fair value basis, the amounts would have been included as follows:
2024
2023
£
£
Cost
206,897
206,897
Accumulated depreciation
(49,451)
(41,175)
Carrying amount
157,446
165,722
13
Stocks
2024
2023
£
£
Raw materials and consumables
371,814
544,933
14
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
1,920,985
3,941,357
Prepayments and accrued income
468,716
456,123
2,389,701
4,397,480
Deferred tax asset (note 17)
81,000
5,000
2,470,701
4,402,480
15
Loans and overdrafts
2024
2023
£
£
Bank loans
354,842
-
0
Payable within one year
354,842
-
0
LGSF LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
15
Loans and overdrafts
(Continued)
- 22 -

Included within bank loans are amounts to be converted into a hire purchase contract in May 2024 and treated as such thereafter. Until this event, amounts are recognised as bank loan repayable within one year and interest is paid monthly at the base rate plus 2.75%.

 

Bank loans are secured against the assets of the company.

 

16
Creditors: amounts falling due within one year
2024
2023
Notes
£
£
Bank loans
15
354,842
-
0
Trade creditors
692,257
2,560,750
Corporation tax
-
0
399,491
Other taxation and social security
260,405
308,950
Other creditors
156,154
279,066
Accruals and deferred income
366,715
588,485
1,830,373
4,136,742
17
Deferred taxation
Liabilities
Liabilities
Assets
Assets
2024
2023
2024
2023
Balances:
£
£
£
£
Accelerated capital allowances
281,000
203,000
-
-
Tax losses
-
-
78,000
-
Investment property
31,379
31,379
-
-
Provisions
-
-
3,000
5,000
312,379
234,379
81,000
5,000
2024
Movements in the year:
£
Liability at 1 April 2023
229,379
Charge to profit or loss
2,000
Liability at 31 March 2024
231,379
LGSF LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 23 -
18
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
238,147
635,605

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.

 

The pension cost charge represents contributions payable by the company to the fund or individual staff pensions as is shown in note 5. £12,057 of unpaid pension contributions were accrued at the year end (2023 - £21,715).

19
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary A Shares of 0.1p each
2,000
2,000
2
2
Ordinary B Shares of 0.1p each
1,000
1,000
1
1
Ordinary C Shares of 0.1p each
2,000
2,000
2
2
Ordinary D Shares of 0.1p each
1,000
1,000
1
1
Ordinary E Shares of 0.1p each
1,000
1,000
1
1
7,000
7,000
7
7

All shares rank pari passu with regards to voting and capital distributions. Dividends may be paid at different rates on the each class of share.

20
Operating lease commitments
Lessee

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

2024
2023
£
£
Within one year
337,425
260,263
Between two and five years
954,886
796,469
In over five years
72,784
150,395
1,365,095
1,207,127
21
Related party transactions
Transactions with related parties

During the year the company entered into the following transactions with related parties:

LGSF LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
21
Related party transactions
(Continued)
- 24 -
Sales
Sales
2024
2023
£
£
Other related parties
210
60,900

The following amounts were outstanding at the reporting end date:

2024
2023
Amounts due from related parties
£
£
Other related parties
253
73,080
22
Ultimate controlling party

The directors are of the opinion that there is no ultimate controlling party.

23
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
36,032
54,165
Company pension contributions to defined contribution schemes
153,333
520,024
189,365
574,189

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 3 (2023 - 3).

LGSF LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 25 -
24
Cash generated from operations
2024
2023
£
£
Profit for the year after tax
86,508
1,746,598
Adjustments for:
Taxation (credited)/charged
(106,514)
437,883
Finance costs
17,242
7,030
Investment income
(12,721)
-
0
Amortisation and impairment of intangible assets
5,000
5,000
Depreciation and impairment of tangible fixed assets
235,105
205,591
Movements in working capital:
Decrease/(increase) in stocks
173,119
(128,238)
Decrease/(increase) in debtors
2,007,779
(398,953)
(Decrease)/increase in creditors
(2,261,720)
1,440,362
Cash generated from operations
143,798
3,315,273
25
Analysis of changes in net funds
1 April 2023
Cash flows
31 March 2024
£
£
£
Cash at bank and in hand
2,820,648
(1,395,306)
1,425,342
Borrowings excluding overdrafts
-
(354,842)
(354,842)
2,820,648
(1,750,148)
1,070,500
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