Company registration number 04723897 (England and Wales)
KUDOX LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
KUDOX LIMITED
COMPANY INFORMATION
Directors
M Erkman
S. Erkman
Secretary
M Erkman
Company number
04723897
Registered office
Bray House
1 Bray Place
London
SW3 3LL
Auditor
Harold Everett Wreford LLP
Portland Suite
Audley House
12-12a Margaret Street
London
W1W 8JQ
Business address
Bray House
1 Bray Place
London
SW3 3LL
Bankers
HSBC UK Bank Plc
KUDOX LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Independent auditor's report
4 - 6
Statement of income and retained earnings
7
Balance sheet
8
Statement of cash flows
9
Notes to the financial statements
10 - 21
KUDOX LIMITED
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
The results for the year and the financial position at the year end were considered satisfactory, given current market conditions, by the directors who expect growth in the foreseeable future.
Principal risks and uncertainties
The company's principal financial instruments comprise bank balances, trade creditors and trade debtors. Due to the nature of the financial instruments there is no exposure to price risk. Trade debtors are managed in respect of credit and cash flow risk by policies concerning the credit offered to customers and the regular monitoring of amounts outstanding for both time and credit limits as well as the use of credit insurance. Trade creditors liquidity risk is managed by ensuring sufficient funds are available to meet amounts due.
Development and performance
The position of the company at the balance sheet date can be summarised as follows:
Gross assets - £12.5 million (2023 - £11.2 million)
Net current assets - £11.4 million (2023 - £10.3 million)
Shareholders' funds - £11.4 million (2023 - £10.3 million)
Key performance indicators
The company has faced challenging market conditions in the year but managed to increase gross profit margin.
Overall the net assets position of the company has improved due to the profits generated and retained during the year.
M Erkman
Director
30 January 2025
KUDOX LIMITED
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 is that of wholesalers of heating and plumbing products.
Results and dividends
The results for the year are set out on page 7.
No ordinary dividends were paid.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
M Erkman
S. Erkman
Future developments
There were no plans for any significant changes in the activity of the company.
Auditor
In accordance with the company's articles, a resolution proposing that Harold Everett Wreford LLP be reappointed as auditor of the company will be put at a General Meeting.
Statement of directors' responsibilities
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.
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.
KUDOX LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
- 3 -
On behalf of the board
M Erkman
Director
30 January 2025
KUDOX LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF KUDOX LIMITED
- 4 -
Opinion
We have audited the financial statements of Kudox Limited (the 'company') for the year ended 30 April 2024 which comprise the statement of income and retained earnings, the balance sheet, 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.
KUDOX LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF KUDOX LIMITED
- 5 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report 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.
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.
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:
Obtain an understanding of the legal and regulatory framework that are applicable to the company. These include, but are not limited to, compliance with the Companies Act, United Kingdom Generally Accepted Accounting Practice and tax legislation.
Make enquiries with those charged with management and governance including whether they had knowledge of any actual, suspected or alleged fraud.
Assessing the susceptibility of the financial statements to material misstatement, including how fraud might occur in the financial statements and any potential indicators of fraud.
Communicating relevant identified laws and regulations and potential fraud risks to all engagement team members and that they remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.
In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which may be fundamental to the company's ability to operate or to avoid a material penalty.
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.
KUDOX LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF KUDOX LIMITED
- 6 -
Following our review, we have identified the following areas which are deemed to have the greatest potential for fraud or material misstatement within the financial statements due to irregularities, including fraud:
Our procedures to respond to risks identified above included the following:
Income transaction testing was performed to test completeness of income including checking of cut-offs to ensure that the associated revenue is reflected in the correct period.
Obtained a full list of related parties and verifying completeness on this list based on our knowledge.
Performing audit work over the risk of management override on controls, including testing of journal entries and other adjustments for appropriateness.
Performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatements due to fraud.
Reading minutes of meeting of those charged with governance.
We remained alert to any indications of fraud, material misstatements or non-compliance with laws and regulations throughout the audit including those relating to the 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.
This report is made solely to the company's member 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 member those matters we are required to state to the member 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 member, for our audit work, for this report, or for the opinions we have formed.
D J Scott
Senior Statutory Auditor
For and on behalf of Harold Everett Wreford LLP
30 January 2025
Chartered Accountants
Statutory Auditor
Portland Suite
Audley House
12-12a Margaret Street
London
W1W 8JQ
KUDOX LIMITED
STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE YEAR ENDED 30 APRIL 2024
- 7 -
2024
2023
Notes
£
£
Turnover
3
12,230,379
9,637,279
Cost of sales
(10,093,836)
(8,045,177)
Gross profit
2,136,543
1,592,102
Distribution costs
(312,369)
(343,832)
Administrative expenses
(740,021)
(831,679)
Other operating income
219,270
Operating profit
4
1,303,423
416,591
Interest receivable and similar income
7
223,072
94,842
Profit before taxation
1,526,495
511,433
Tax on profit
8
(385,232)
(104,936)
Profit for the financial year
1,141,263
406,497
Retained earnings brought forward
10,274,782
9,868,285
Retained earnings carried forward
11,416,045
10,274,782
The Profit and Loss Account has been prepared on the basis that all operations are continuing operations.
KUDOX LIMITED
BALANCE SHEET
AS AT 30 APRIL 2024
30 April 2024
- 8 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
10
57,828
63,671
Current assets
Stocks
11
909,334
1,132,454
Debtors
12
3,410,027
3,116,146
Cash at bank and in hand
8,116,525
6,880,158
12,435,886
11,128,758
Creditors: amounts falling due within one year
13
(1,063,211)
(905,230)
Net current assets
11,372,675
10,223,528
Total assets less current liabilities
11,430,503
10,287,199
Provisions for liabilities
Deferred tax liability
14
14,457
12,416
(14,457)
(12,416)
Net assets
11,416,046
10,274,783
Capital and reserves
Called up share capital
16
1
1
Profit and loss reserves
17
11,416,045
10,274,782
Total equity
11,416,046
10,274,783
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.
The financial statements were approved by the board of directors and authorised for issue on 30 January 2025 and are signed on its behalf by:
M Erkman
Director
Company registration number 04723897 (England and Wales)
KUDOX LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 APRIL 2024
- 9 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from/(absorbed by) operations
21
1,110,539
(1,186,081)
Income taxes paid
(92,850)
(199,594)
Net cash inflow/(outflow) from operating activities
1,017,689
(1,385,675)
Investing activities
Purchase of tangible fixed assets
(4,394)
(57,677)
Interest received
223,072
94,842
Net cash generated from investing activities
218,678
37,165
Net increase/(decrease) in cash and cash equivalents
1,236,367
(1,348,510)
Cash and cash equivalents at beginning of year
6,880,158
8,228,668
Cash and cash equivalents at end of year
8,116,525
6,880,158
KUDOX LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2024
- 10 -
1
Accounting policies
Company information
Kudox Limited is a private company limited by shares incorporated in England and Wales. The registered office is Bray House, 1 Bray Place, London, SW3 3LL.
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. The principal accounting policies adopted are set out below.
The financial statements present information about the company as an individual undertaking and not about its group. The company has not prepared group accounts as it has taken exemption from the requirement to do so by section 405 (2) of the Companies Act 2006 as its only subsidiary undertaking has been dormant throughout the year.
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
Intangible fixed assets other than goodwill
Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.
Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.
Amortisation 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:
Software development costs
- over 5 years
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.
KUDOX LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
1
Accounting policies
(Continued)
- 11 -
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:
Land and buildings Leasehold
Term of the lease
Fixtures, fittings & equipment
15% reducing balance
Computer equipment
25% reducing balance
Motor vehicles
15% reducing balance
1.6
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.
1.7
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.
KUDOX LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
1
Accounting policies
(Continued)
- 12 -
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.
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.
KUDOX LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
1
Accounting policies
(Continued)
- 13 -
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.10
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
Derivatives
Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently remeasured to fair value at each reporting end date. The resulting gain or loss is recognised in profit or loss immediately unless the derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on the nature of the hedge relationship.
A derivative with a positive fair value is recognised as a financial asset, whereas a derivative with a negative fair value is recognised as a financial liability.
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.
KUDOX LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
1
Accounting policies
(Continued)
- 14 -
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.
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.
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.
KUDOX LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
- 15 -
3
Turnover and other revenue
An analysis of the company's turnover is as follows:
2024
2023
£
£
Turnover analysed by class of business
Sale of goods
12,230,379
9,637,279
2024
2023
£
£
Other revenue
Interest income
223,072
94,842
4
Operating profit
2024
2023
Operating profit for the year is stated after charging:
£
£
Exchange (gains)/losses
1,546
Fees payable to the company's auditor for the audit of the company's financial statements
14,500
14,500
Depreciation of owned tangible fixed assets
10,237
11,283
Amortisation of intangible assets
-
10,560
Operating lease charges
-
50,000
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2024
2023
Number
Number
Administration
9
10
Management
2
2
Total
11
12
Their aggregate remuneration comprised:
2024
2023
£
£
Wages and salaries
522,834
516,434
Social security costs
46,244
50,965
Pension costs
29,403
22,849
598,481
590,248
KUDOX LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
- 16 -
6
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
108,048
106,179
7
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
223,047
94,824
Other interest income
25
18
Total income
223,072
94,842
2024
2023
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
223,047
94,824
8
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
383,191
92,850
Adjustments in respect of prior periods
(330)
Total current tax
383,191
92,520
Deferred tax
Origination and reversal of timing differences
2,041
12,416
Total tax charge
385,232
104,936
KUDOX LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
8
Taxation
(Continued)
- 17 -
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
1,526,495
511,433
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 19.00%)
381,624
97,172
Tax effect of expenses that are not deductible in determining taxable profit
(106)
(175)
Permanent capital allowances in excess of depreciation
1,098
10,959
Depreciation on assets not qualifying for tax allowances
(2,559)
(2,144)
Amortisation on assets not qualifying for tax allowances
(2,006)
Other permanent differences
2,041
Other tax adjustments
3,134
1,130
Taxation charge for the year
385,232
104,936
9
Intangible fixed assets
Software development costs
£
Cost
At 1 May 2023 and 30 April 2024
112,800
Amortisation and impairment
At 1 May 2023 and 30 April 2024
112,800
Carrying amount
At 30 April 2024
At 30 April 2023
KUDOX LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
- 18 -
10
Tangible fixed assets
Land and buildings Leasehold
Fixtures, fittings & equipment
Computer equipment
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 May 2023
93,912
5,966
58,992
55,399
214,269
Additions
4,394
4,394
At 30 April 2024
93,912
5,966
63,386
55,399
218,663
Depreciation and impairment
At 1 May 2023
93,912
5,841
42,535
8,310
150,598
Depreciation charged in the year
91
3,083
7,063
10,237
At 30 April 2024
93,912
5,932
45,618
15,373
160,835
Carrying amount
At 30 April 2024
34
17,768
40,026
57,828
At 30 April 2023
125
16,457
47,089
63,671
11
Stocks
2024
2023
£
£
Finished goods and goods for resale
909,334
1,132,454
12
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
3,386,828
3,086,378
Other debtors
20,000
20,000
Prepayments and accrued income
3,199
9,768
3,410,027
3,116,146
13
Creditors: amounts falling due within one year
2024
2023
£
£
Trade creditors
232,433
722,686
Corporation tax
383,191
92,850
Other taxation and social security
48,021
64,787
Accruals and deferred income
399,566
24,907
1,063,211
905,230
KUDOX LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
- 19 -
14
Deferred taxation
Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:
Liabilities
Liabilities
2024
2023
Balances:
£
£
Accelerated capital allowances
14,457
12,416
2024
Movements in the year:
£
Liability at 1 May 2023
12,416
Charge to profit or loss
2,041
Liability at 30 April 2024
14,457
The deferred tax liability set out above is expected to reverse within [12 months] and relates to accelerated capital allowances that are expected to mature within the same period.
15
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
29,403
22,849
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.
16
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary share of £1 each
1
1
1
1
17
Profit and loss reserves
2024
2023
£
£
At the beginning of the year
10,274,782
9,868,285
Profit for the year
1,141,263
406,497
At the end of the year
11,416,045
10,274,782
KUDOX LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
- 20 -
18
Operating lease commitments
Lessee
During the year, the lease was surrendered and at the reporting end date the company had no outstanding commitments for future lease payments under non-cancellable operating lease.
2024
2023
£
£
Within one year
50,000
Between two and five years
45,833
95,833
19
Related party transactions
Transactions with related parties
During the year the company did not have any transactions with the related parties.
Since the non-cancellable lease was surrendered during the year, there was no rent payable during the year (2023 - £50,000) to Bray Place Limited, a company registered in the British Virgin Islands and controlled by relatives of the directors of Kudox Limited.
20
Ultimate controlling party
The parent undertaking is Olden Investments Limited, a company registered in the British Virgin Islands and controlled by relatives of the directors of Kudox limited.
21
Cash generated from/(absorbed by) operations
2024
2023
£
£
Profit for the year after tax
1,141,263
406,497
Adjustments for:
Taxation charged
385,232
104,936
Investment income
(223,072)
(94,842)
Amortisation and impairment of intangible assets
10,560
Depreciation and impairment of tangible fixed assets
10,237
11,283
Movements in working capital:
Decrease/(increase) in stocks
223,120
(438,141)
(Increase)/decrease in debtors
(293,881)
5,975,726
Decrease in creditors
(132,360)
(7,162,100)
Cash generated from/(absorbed by) operations
1,110,539
(1,186,081)
KUDOX LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 APRIL 2024
- 21 -
22
Analysis of changes in net funds
1 May 2023
Cash flows
30 April 2024
£
£
£
Cash at bank and in hand
6,880,158
1,236,367
8,116,525
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