Company registration number 01532883 (England and Wales)
RIFTWARD LTD
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
RIFTWARD LTD
COMPANY INFORMATION
Directors
R L Morris
C Demmer
R Morris
Secretary
R L Morris
Company number
01532883
Registered office
Ash Road
Wrexham Industrial Estate
Wrexham
LL13 9JT
Auditor
D G Hicks Ltd
Unit 11
Mold Business Park
Wrexham Road
Mold
CH7 1XP
RIFTWARD LTD
CONTENTS
Page
Strategic report
1
Directors' report
2
Directors' responsibilities statement
3
Independent auditor's report
4 - 6
Profit and loss account
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 - 24
RIFTWARD LTD
STRATEGIC REPORT
FOR THE YEAR ENDED 30 APRIL 2024
- 1 -
The directors present the strategic report for the year ended 30 April 2024.
Review of the business
Turnover for the year contracted by 10% from £13.49m to £12.02m. The main reason was the reduction in raw material prices this year when compared to last, and this reduction was passed onto customers. In terms of volume, sales were actually higher this year than last.
The Company has continued to invest in new technology and process improvements which will make us more efficient going forward.
Profit before tax was £0.793m in comparison to £0.598m in the previous financial year.
Principal risks and uncertainties
Credit risk
The company has implemented policies that require appropriate credit checks on potential customers before sales are made. The debtors ledger is reviewed on an on-going basis to identify unpaid amounts with overdue debts being chased on a regular basis. Provisions for bad debts are made where appropriate and funds are set-aside to cover cashflow shortages from bad debts.
Liquidity risk
The directors have ultimate responsibility for liquidity risk management in maintaining adequate reserves, banking and borrowing facilities. Active management of the cash position is undertaken with future cash flows being reviewed to ensure that significant liquid resources are available.
Interest rate risk
With the increase in stock, the company has increased its exposure to interest rate risk through the impact of rate changes in interest bearing borrowings. Active management of the company's exposure to interest rate fluctuations is undertaken by managing the borrowings on a group wide basis.
Future Developments
Our goal remains to be product leaders in the market place. We are continually making improvements to existing products and at the same time developing new products to satisfy current and future needs within the markets in which we operate.
Development and performance
The company measures its financial performance and position by reference to key performance indicators including turnover, profit before tax, net assets and net current assets. An analysis of the performance and position of the company by reference to some of these KPI's is included in the business review above.
Key performance indicators
The company uses non-financial KPI's to monitor and measure success on a regular basis.
.............................................
R L Morris
Director
Date: .............................................
RIFTWARD LTD
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 APRIL 2024
- 2 -
The directors present their annual report and financial statements for the year ended 30 April 2024.
Principal activities
The principal activity of the company continued to be that of trading as a packaging specialist.
Results and dividends
The results for the year are set out on page 7.
No ordinary dividends were paid. 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:
R L Morris
C Demmer
R Morris
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
R L Morris
Director
27 January 2025
RIFTWARD LTD
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 30 APRIL 2024
- 3 -
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:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
RIFTWARD LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF RIFTWARD LTD
- 4 -
Opinion
We have audited the financial statements of Riftward Ltd (the 'company') for the year ended 30 April 2024 which comprise the profit and loss account, 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:
give a true and fair view of the state of the company's affairs as at 30 April 2024 and of its profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
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.
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:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
RIFTWARD LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF RIFTWARD LTD
- 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 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:
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the 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.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
RIFTWARD LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF RIFTWARD LTD
- 6 -
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:
- We reviewed systems and procedures to identify potential areas of management override risk, in particular, we carried out testing of journal entries and other adjustments for appropriateness, and evaluating the business rationale of significant transactions to identify large or unusual transactions. We reviewed key authorisation procedures and decision making processes for any unusual or one-off transactions;
- We reviewed of directors' minutes to understand if any instances of non-compliance with laws and regulations have occurred;
- We undertook testing to confirm the existence of a sample of employees to ensure that no fictitious employees are paid, and also checked that said employees were being paid in accordance with their contracts of employment;
- We gained confirmation directly from the company's bank, of the accounts and balances held in their name as at the year-end and that all reported balances exist;
- We reviewed legal expenses to identify any instances of non-compliance with laws and regulations;
- We discuss laws and regulations with the directors to understand which are relevant and to understand if they are aware of any breaches or potential breaches;
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.
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.
Daniel Hicks FCA
Senior Statutory Auditor
For and on behalf of D G Hicks Ltd
27 January 2025
Chartered Accountants
Statutory Auditor
Unit 11
Mold Business Park
Wrexham Road
Mold
CH7 1XP
RIFTWARD LTD
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 30 APRIL 2024
- 7 -
2024
2023
Notes
£
£
Turnover
3
12,017,440
13,448,589
Cost of sales
(9,065,063)
(10,771,936)
Gross profit
2,952,377
2,676,653
Distribution costs
(668,792)
(643,984)
Administrative expenses
(1,576,160)
(1,460,235)
Other operating income
43,139
41,237
Operating profit
4
750,564
613,671
Interest receivable and similar income
7
39,386
11,173
Interest payable and similar expenses
8
(40,111)
(24,118)
Fair value movements
9
43,040
(2,000)
Profit before taxation
792,879
598,726
Tax on profit
10
(400,505)
Profit for the financial year
392,374
598,726
The profit and loss account has been prepared on the basis that all operations are continuing operations.
RIFTWARD LTD
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 APRIL 2024
- 8 -
2024
2023
£
£
Profit for the year
392,374
598,726
Other comprehensive income
-
-
Total comprehensive income for the year
392,374
598,726
RIFTWARD LTD
BALANCE SHEET
AS AT
30 APRIL 2024
30 April 2024
- 9 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
12
3,126,458
2,566,620
Investment properties
13
815,500
815,500
3,941,958
3,382,120
Current assets
Stocks
15
266,018
233,471
Debtors
16
2,156,355
1,931,691
Investments
17
510,888
465,797
Cash at bank and in hand
1,529,960
1,730,575
4,463,221
4,361,534
Creditors: amounts falling due within one year
18
(2,654,361)
(2,657,144)
Net current assets
1,808,860
1,704,390
Total assets less current liabilities
5,750,818
5,086,510
Creditors: amounts falling due after more than one year
19
(439,286)
(567,857)
Provisions for liabilities
(532,734)
(132,229)
Net assets
4,778,798
4,386,424
Capital and reserves
Called up share capital
24
100
100
Profit and loss reserves
4,778,698
4,386,324
Total equity
4,778,798
4,386,424
The financial statements were approved by the board of directors and authorised for issue on 27 January 2025 and are signed on its behalf by:
R L Morris
Director
Company Registration No. 01532883
RIFTWARD LTD
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 APRIL 2024
- 10 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 May 2022
100
3,789,598
3,789,698
Year ended 30 April 2023:
Profit and total comprehensive income
-
598,726
598,726
Dividends
11
-
(2,000)
(2,000)
Balance at 30 April 2023
100
4,386,324
4,386,424
Year ended 30 April 2024:
Profit and total comprehensive income
-
392,374
392,374
Balance at 30 April 2024
100
4,778,698
4,778,798
RIFTWARD LTD
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 APRIL 2024
- 11 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
26
919,367
1,012,484
Interest paid
(40,111)
(24,118)
Net cash inflow from operating activities
879,256
988,366
Investing activities
Purchase of tangible fixed assets
(968,000)
(344,511)
Proceeds from disposal of tangible fixed assets
6,346
17,646
Proceeds from disposal of investments
(2,051)
322
Interest received
30,359
3,241
Dividends received
9,027
7,932
Net cash used in investing activities
(924,319)
(315,370)
Financing activities
Repayment of bank loans
(11,800)
(260,955)
Payment of finance leases obligations
(143,559)
(172,490)
Dividends paid
(2,000)
Net cash used in financing activities
(155,359)
(435,445)
Net (decrease)/increase in cash and cash equivalents
(200,422)
237,551
Cash and cash equivalents at beginning of year
1,730,194
1,492,643
Cash and cash equivalents at end of year
1,529,772
1,730,194
Relating to:
Cash at bank and in hand
1,529,960
1,730,575
Bank overdrafts included in creditors payable within one year
(188)
(381)
RIFTWARD LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
- 12 -
1
Accounting policies
Company information
Riftward Ltd is a private company limited by shares incorporated in England and Wales. The registered office is Ash Road, Wrexham Industrial Estate, Wrexham, LL13 9JT.
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 £.
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
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.
1.4
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:
Freehold land and buildings
2% straight line
Plant and equipment
10 - 15% straight line
Fixtures and fittings
15% straight line
Computers
33% straight line
Motor vehicles
25% straight line
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.
1.5
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.
RIFTWARD LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
1
Accounting policies
(Continued)
- 13 -
1.6
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.
1.7
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.
1.8
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.
1.9
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.
RIFTWARD LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
1
Accounting policies
(Continued)
- 14 -
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.
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.
RIFTWARD LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
1
Accounting policies
(Continued)
- 15 -
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.10
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.
1.11
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.
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.
1.12
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.
1.13
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
RIFTWARD LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
1
Accounting policies
(Continued)
- 16 -
1.14
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
1.15
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 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.
3
Turnover and other revenue
2024
2023
£
£
Turnover analysed by geographical market
United Kingdom
12,017,440
13,448,589
2024
2023
£
£
Other revenue
Interest income
30,359
3,241
Dividends received
9,027
7,932
RIFTWARD LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
- 17 -
4
Operating profit
2024
2023
Operating profit for the year is stated after charging/(crediting):
£
£
Fees payable to the company's auditor for the audit of the company's financial statements
4,335
4,675
Depreciation of owned tangible fixed assets
278,544
242,145
Depreciation of tangible fixed assets held under finance leases
130,040
130,040
Profit on disposal of tangible fixed assets
(6,768)
(12,583)
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2024
2023
Number
Number
37
35
Their aggregate remuneration comprised:
2024
2023
£
£
Wages and salaries
1,105,011
1,005,191
Social security costs
113,579
111,401
Pension costs
32,336
30,572
1,250,926
1,147,164
6
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
126,137
102,014
Company pension contributions to defined contribution schemes
12,000
9,600
138,137
111,614
RIFTWARD LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
- 18 -
7
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
30,359
3,241
Other income from investments
Dividends received
9,027
7,932
Total income
39,386
11,173
2024
2023
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
30,359
3,241
8
Interest payable and similar expenses
2024
2023
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
2,724
3,948
Other finance costs:
Interest on finance leases and hire purchase contracts
37,387
20,170
40,111
24,118
9
Amounts written off investments
2024
2023
£
£
Amounts written back to/(written off) financial assets held at cost
43,040
(2,000)
10
Taxation
2024
2023
£
£
Deferred tax
Origination and reversal of timing differences
400,505
RIFTWARD LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
10
Taxation
(Continued)
- 19 -
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2024
2023
£
£
Profit before taxation
792,879
598,726
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 25.00%)
198,220
149,682
Tax effect of expenses that are not deductible in determining taxable profit
(10,495)
(434)
Gains not taxable
(2,257)
(1,983)
Unutilised tax losses carried forward
(157,451)
Permanent capital allowances in excess of depreciation
(143,611)
10,186
Utilisation of losses b/f
(41,857)
Deferred tax
400,505
Taxation charge for the year
400,505
-
11
Dividends
2024
2023
£
£
Final paid
2,000
RIFTWARD LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
- 20 -
12
Tangible fixed assets
Freehold land and buildings
Plant and equipment
Fixtures and fittings
Computers
Motor vehicles
Total
£
£
£
£
£
£
Cost
At 1 May 2023
1,320,423
4,113,654
358,754
126,800
279,574
6,199,205
Additions
946,518
570
20,912
968,000
Disposals
(573,989)
(7,034)
(53,195)
(634,218)
At 30 April 2024
1,320,423
4,486,183
351,720
74,175
300,486
6,532,987
Depreciation and impairment
At 1 May 2023
554,128
2,499,798
313,769
126,247
138,643
3,632,585
Depreciation charged in the year
26,340
312,296
11,379
337
58,232
408,584
Eliminated in respect of disposals
(574,260)
(7,034)
(53,346)
(634,640)
At 30 April 2024
580,468
2,237,834
318,114
73,238
196,875
3,406,529
Carrying amount
At 30 April 2024
739,955
2,248,349
33,606
937
103,611
3,126,458
At 30 April 2023
766,295
1,613,856
44,985
553
140,931
2,566,620
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
2024
2023
£
£
Plant and equipment
850,961
967,001
Motor vehicles
26,834
40,834
877,795
1,007,835
13
Investment property
2024
£
Fair value
At 1 May 2023 and 30 April 2024
815,500
The 2020 valuations were made by the directors, on an open market value for existing use basis.
14
Financial instruments
2024
2023
£
£
Carrying amount of financial assets
Listed investments
510,888
465,797
RIFTWARD LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
- 21 -
15
Stocks
2024
2023
£
£
Finished goods and goods for resale
266,018
233,471
16
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
2,046,375
1,830,747
Prepayments and accrued income
109,980
100,944
2,156,355
1,931,691
17
Current asset investments
2024
2023
£
£
Unlisted investments
510,888
465,797
18
Creditors: amounts falling due within one year
2024
2023
Notes
£
£
Bank loans and overdrafts
20
188
12,181
Obligations under finance leases
21
128,561
143,549
Trade creditors
1,879,336
1,806,957
Taxation and social security
174,017
175,824
Other creditors
72
Accruals and deferred income
472,259
518,561
2,654,361
2,657,144
Bank loans are secured by fixed and floating charges on the assets owned by the Company.
Obligations under hire purchase contracts are secured on the assets to which they relate.
19
Creditors: amounts falling due after more than one year
2024
2023
Notes
£
£
Obligations under finance leases
21
439,286
567,857
RIFTWARD LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
19
Creditors: amounts falling due after more than one year
(Continued)
- 22 -
Amounts included above which fall due after five years are as follows:
Payable by instalments
-
53,585
20
Loans and overdrafts
2024
2023
£
£
Bank loans
11,800
Bank overdrafts
188
381
188
12,181
Payable within one year
188
12,181
The long-term loans are secured by fixed charges over the assets of the company.
21
Finance lease obligations
2024
2023
Future minimum lease payments due under finance leases:
£
£
Within one year
128,561
143,549
In two to five years
439,286
567,857
567,847
711,406
Finance lease payments represent rentals payable by the company for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 4 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
RIFTWARD LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
- 23 -
22
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2024
2023
Balances:
£
£
Accelerated capital allowances
479,914
107,110
Investment property
20,046
15,235
Investments
32,774
9,884
532,734
132,229
2024
Movements in the year:
£
Liability at 1 May 2023
132,229
Charge to profit or loss
400,505
Liability at 30 April 2024
532,734
23
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
32,336
30,572
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. Contributions totalling £4,058 (2023: £3,775) were payable to the fund at the reporting date.
24
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
100
100
100
100
25
Controlling party
The company is controlled by its directors by virtue of their respective shareholdings in the company.
RIFTWARD LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
- 24 -
26
Cash generated from operations
2024
2023
£
£
Profit for the year after tax
392,374
598,726
Adjustments for:
Taxation charged
400,505
Finance costs
40,111
24,118
Investment income
(39,386)
(11,173)
Gain on disposal of tangible fixed assets
(6,768)
(12,583)
Depreciation and impairment of tangible fixed assets
408,584
372,185
Other gains and losses
(43,040)
2,000
Movements in working capital:
(Increase)/decrease in stocks
(32,547)
32,215
(Increase)/decrease in debtors
(224,664)
501,348
Increase/(decrease) in creditors
24,198
(494,352)
Cash generated from operations
919,367
1,012,484
27
Analysis of changes in net funds
1 May 2023
Cash flows
30 April 2024
£
£
£
Cash at bank and in hand
1,730,575
(200,615)
1,529,960
Bank overdrafts
(381)
193
(188)
1,730,194
(200,422)
1,529,772
Borrowings excluding overdrafts
(11,800)
11,800
-
Obligations under finance leases
(711,406)
143,559
(567,847)
1,006,988
(45,063)
961,925
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