Registered number:
FOR THE YEAR ENDED 29 DECEMBER 2023
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SOAPWORKS LIMITED
COMPANY INFORMATION
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SOAPWORKS LIMITED
CONTENTS
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SOAPWORKS LIMITED
STRATEGIC REPORT
FOR THE PERIOD ENDED 29 DECEMBER 2023
The directors present the strategic report for the year ended 29 December 2023.
The Company experienced a minor reduction of its turnover of £34k from 2022. There was a slight contraction of domestic sales of 1% but this was offset by an increase in export turnover of 2%. The administrative burden as a result of Brexit has restricted growth opportunities with EU countries however as we become accustomed tothe new way of trading it will hopefully reduce number of barriers to entry. The change in buyers trends with more trade happening online is making the retail sector more uncertain and it is difficult for retailers to accurately forecast demand. The gross margin of the business increased from 14.8% in 2022 to 15.2% during 2023 which was a result of product mix and overhead control.
The Company continues to offer a wide selection of luxurious products to its customers and quality and delivery performance remain at the forefront of the Company's ethos. The Company believes that it has the necessary structure and experience in place to produce goods to the highest quality for its customers that will help them to stand out from their competition. The Company continues to exceed its delivery performance and quality performance targets which are the key foundations for a successful business. Sustainability and environmental responsibilities are extremely high on the agenda for the Company and it continues to exceed targets in energy reduction and carbon footprint. The use of sustainable materials continues to increase within the Company's products which enables customers to market this in their product offerings. The Company continues to focus on its Corporate Social Responsibility and along with the Company's environmental measures, the “Soap Aid” project remains an important aspect of life at Soapworks. Where possible residual materials from the end of soap products life cycles are utilised and converted into Soap Aid charity soap. Staff manufacture these products in their own time. The company works with its partner in this project Glasgow the Caring City and the soaps are distributed to areas that have suffered pandemics, natural disasters or refugee camps for example.
The company operates in a competitive market and the retention of key customers remains a priority as well as developing new trading partnerships and product offerings. The changing retail environment and consumer’s buying habits remain a risk to the business. The cost of living crisis over the last couple of years has impacted on consumers buying habits and trends. The company is a contract manufacturer and is reliant on its customers being successful and relevant in the ever changing landscape. The Company ensures that is up to date with the latest market trends to enable it to offer products to its customers which will help to protect demand.
Rising material costs and more lately the significant increases in energy costs provide a challenge to the Company. Measures to reduce energy consumption are high on the agenda of the Company to both reduce the impact of rising costs but also from an environmental aspect in reducing the carbon footprint. The Company is working with strategic partners in this area to help achieve its goals. Nevertheless, after making enquiries and considering the uncertainties described above, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. For these reasons they continue to adopt the going concern basis in preparing the annual report and accounts.
The Company manages the risk of competition through product innovation in conjunction with its customers whilst providing quality products and maintaining excellent customer service.
The Company's principal financial assets are trade and other debtors. The Company's credit risk is primarily attributable to its trade debtors. The amounts presented in the balance sheet are net of allowances for doubtful receivables. The Company has no significant concentration of credit risk, with exposure spread over a large number of counterparties and customers.
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SOAPWORKS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 29 DECEMBER 2023
The company's principal financial instruments are cash, debt discounting and general banking facilities, all of which are used to facilitate normal trading operations. The main risks from the company's financial instruments are credit, liquidity and cash flow risk.
The company mitigates credit risk by thorough credit vetting of customers prior to commencement of trade and periodically thereafter, systematic enforcement of credit limits and agreed payment terms and insuring of trade debt. The company mitigates liquidity risk through financing from a mix of shareholders' funds and bank borrowings. This mix of funding offers flexibility and cost effectiveness to match the needs of the Company. The company mitigates cash flow risk by discounting debt with a third party to ensure sufficient funding to satisfy creditors as they fall due, enforcement of customer credit limits and agreed payment terms.
This report was approved by the board and signed on its behalf.
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SOAPWORKS LIMITED
DIRECTORS' REPORT
FOR THE PERIOD ENDED 29 DECEMBER 2023
The directors present their report and the financial statements for the period ended 29 December 2023.
The directors are responsible for preparing the Strategic report, the Directors' 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give year a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period.
In preparing these financial statements, the directors are required to:
•select suitable accounting policies for the Company's financial statements 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 its is inappropriate to presume that the
Company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and to 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.
The profit for the period, after taxation, amounted to £19,486 (2022 - loss £519,965).
There are no current plans to make any dividend payments (2022 - £NIL).
The directors who served during the period were:
The Company are looking to continue to improve their sales and customer profile.
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SOAPWORKS LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE PERIOD ENDED 29 DECEMBER 2023
There have been no significant events affecting the Company since the year end.
Under section 487(2) of the Companies Act 2006, French Duncan LLP (trading as AAB) will be deemed to have been reappointed as auditors 28 days after these financial statements were sent to members or 28 days after the latest date prescribed for filing the accounts with the registrar, whichever is earlier.
This report was approved by the board on
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SOAPWORKS LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SOAPWORKS LIMITED
We have audited the of Soapworks Limited (the 'Company') for the period ended 29 December 2023, which comprise the Statement of income and retained earnings, the Statement of financial position, the Statement of cash flow and the related notes 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).
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 section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the in the United Kingdom, including the Financial Reporting Council'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.
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.
The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' 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.
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SOAPWORKS LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SOAPWORKS LIMITED (CONTINUED)
In our opinion, based on the work undertaken in the course of the audit:
•the information given in the Strategic report and the Directors' report for the financial period for which the
financial statements are perepared is consistent with the financial statment; and
•the Strategic report and the Directors' report have been prepared in accordance with applicable legal
requirements.
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.
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SOAPWORKS LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SOAPWORKS LIMITED (CONTINUED)
Our objectives are to obtain reasonable assurance about whether the as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditors' 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.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below.
The extent to which the audit was considered capable of detecting irregularities including fraud
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:
•the engagement partner ensured that the engagement team collectively had the appropriate competence,
capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
•we identified the laws and regulations applicable to the company through discussions with directors and
other management, and from our commercial knowledge and experience;
•we focused on specific laws and regulations which we considered may have a direct material effect on the
financial statements or the operations of the company, including the Companies Act 2006, taxation
legislation and data protection, anti-bribery, employment, and health and safety legislation;
•we assessed thevextent of compliance with the laws and regulations identified above through making
enquiries of management; and
• identified laws and regulations were communicated within the audit team regularly and the team remained
alert to instances of non-compliance throughout the audit.
We assessed the susceptibility of the company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:
•making enquiries of management as to where they considered there was susceptibility to fraud, their
knowledge of actual, suspected and alleged fraud; and considering the internal
controls in place to mitigate risks of fraud and non-compliance with laws and regulations.
To address the risk of fraud through management bias and override of controls, we:
•performed high level analytical procedures to identify any unusual or unexpected relationships;
•tested journal entries to identify unusual transactions;
•assessed whether judgements and assumptions made in determining the accounting estimates were
indicative of potential bias; and
•investigated the rationale behind significant or unusual transactions.
The extent to which the audit was considered capable of detecting irregularities including fraud (continued)
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures
which included, but were not limited to:
•agreeing financial statement disclosures to underlying supporting documentation;
•reading the minutes of meetings of those charged with governance; and
•enquiring of management as to actual and potential litigation and claim.
There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is we would become aware of non-compliance.
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SOAPWORKS LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SOAPWORKS LIMITED (CONTINUED)
Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of directors and other management and the inspection of regulatory and legal correspondence, if any.
Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.
A further description of our responsibilities for the audit of the is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' 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 Comapany's members those matters we are required to state to them in an Auditors' 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.
for and on behalf of
Chartered Accountants & Statutory Auditor
133 Finnieston Street
G3 8HB
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SOAPWORKS LIMITED
STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE PERIOD ENDED 29 DECEMBER 2023
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SOAPWORKS LIMITED
REGISTERED NUMBER: SC388292
STATEMENT OF FINANCIAL POSITION
AS AT 29 DECEMBER 2023
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 14 to 28 form part of these financial statements.
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SOAPWORKS LIMITED
STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED 29 DECEMBER 2023
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SOAPWORKS LIMITED
STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE PERIOD ENDED 29 DECEMBER 2023
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SOAPWORKS LIMITED
ANALYSIS OF NET DEBT
FOR THE PERIOD ENDED 29 DECEMBER 2023
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SOAPWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 29 DECEMBER 2023
Soapworks Limited is a private company limited by shares incorporated in Scotland. The registered office is 53 Coltness Street, Glasgow, United Kingdom, G33 4JD. The company registered number is SC388292.
The principal activity of the company is the manufacture of soap.
2.Accounting policies
The financial statements are prepared in GBP and rounded to the nearest £
The following principal accounting policies have been applied:
The directors are required to prepare the statutory financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business. In satisfaction of this responsibility the directors have considered the company's ability to meet its liabilities as they fall due.
The current and future financial position of the company, its cash flows and liquidity position have been reviewed by the directors. Despite having net current liabilities, the company has obtained assurances that the immediate parent company will continue to provide such financial support as necessary to facilitate the development and growth of the company and to meet its long term strategic objectives. The directors have satisfied themselves as to the validity of these assurances and that the immediate parent company has the means and authority to provide such funding as and when it is required. The directors acknowledge that had these assurances not been secured then uncertainty would exist which may cast doubt over the company's ability to continue as a going concern and therefore its ability to realise its assets and discharge its liabilities in the normal course of business. However, on the basis of the assurances received, the directors believe that no such material uncertainty exists. As such, the directors consider that it is appropriate to prepare the financial statements on the going
concern basis.
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SOAPWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 29 DECEMBER 2023
2.Accounting policies (continued)
Functional and presentation currency
Transactions and balances
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SOAPWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 29 DECEMBER 2023
2.Accounting policies (continued)
If it is not possible to distinguish between the research phase and the development phase of an internal project, the expenditure is treated as if it were all incurred in the research phase only.
Short-term employee benefits are recognised as an expense in the period in which they are incurred.
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SOAPWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 29 DECEMBER 2023
2.Accounting policies (continued)
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
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SOAPWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 29 DECEMBER 2023
2.Accounting policies (continued)
Provisions are made where an event has taken place that gives the Company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.
Provisions are charged as an expense to profit or loss in the year that the Company becomes aware of the obligation, and are measured at the best estimate at the balance sheet date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties. When payments are eventually made, they are charged to the provision carried in the Balance Sheet.
The Company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cashflows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of about-right short-term loan that is not at market rate, the financial asset or liability is measured, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost, unless it qualifies as a loan from a director in the case of a small company, or a public benefit entity concessionary loan. Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Statement of Income and Retained Earnings. Provisions Provisions are recognised where the Company has an obligation, as a result of a past event, that can be measured reliably. The recording of provisions is an area which requires the exercise of management judgement relating to the nature, timing and probability of the liability and typically the Company's Balance Sheet includes provisions for bad debts and stock.
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SOAPWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 29 DECEMBER 2023
Analysis of turnover by country of destination:
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SOAPWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 29 DECEMBER 2023
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SOAPWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 29 DECEMBER 2023
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SOAPWORKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 29 DECEMBER 2023
There were no factors that may affect future tax charges.
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