Company registration number 01060893 (England and Wales)
STRATTON MOTOR COMPANY (NORFOLK) LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
STRATTON MOTOR COMPANY (NORFOLK) LIMITED
COMPANY INFORMATION
Directors
R Bennington
K Cummings
Secretary
Mrs K Cummings
Company number
01060893
Registered office
Rotherwood
Ipswich Road
Long Stratton
Norfolk
NR15 2XJ
Auditor
Afford Bond Holdings Limited
31 Wellington Road
Nantwich
Cheshire
CW5 7ED
STRATTON MOTOR COMPANY (NORFOLK) LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Independent auditor's report
4 - 6
Statement of comprehensive income
7
Balance sheet
8
Statement of changes in equity
9
Statement of cash flows
10
Notes to the financial statements
11 - 23
STRATTON MOTOR COMPANY (NORFOLK) LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2024
- 1 -
The directors present the strategic report for the year ended 31 March 2024.
Review of the business
The directors aim to present a balanced and comprehensive review of the development and performance of the business during the year and the company's position at the year end. Our review is consistent with the size and non-complex nature of the business and is written in the context of the risks and uncertainties facing the company.
Principal risks and uncertainties
The business environment within the retail motor trade continues to be challenging. Though progress has been made during the year.
With these risks and uncertainties in mind, the directors are aware that any plans for the future development of the company may be subject to unforeseen future events outside of their control.
Key performance indicators
The directors consider their key performance indicators are those that communicate the financial performance and strength of the company as a whole, being turnover, gross margin and shareholders funds.
R Bennington
Director
27 January 2025
STRATTON MOTOR COMPANY (NORFOLK) LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2024
- 2 -
The directors present their annual report and financial statements for the year ended 31 March 2024.
Principal activities
The principal activity of the company continued to be that of a retail motor dealer.
The company specialises in Aston Martin and Lotus used vehicle sales, as well as providing a full aftersales service through its workshop and parts departments.
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 Bennington
K Cummings
Auditor
Afford Bond Holdings Limited were appointed auditor to the company and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed 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.
STRATTON MOTOR COMPANY (NORFOLK) LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 3 -
On behalf of the board
R Bennington
Director
27 January 2025
STRATTON MOTOR COMPANY (NORFOLK) LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF STRATTON MOTOR COMPANY (NORFOLK) LIMITED
- 4 -
Opinion
We have audited the financial statements of Stratton Motor Company (Norfolk) Limited (the 'company') for the year ended 31 March 2024 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
give a true and fair view of the state of the company's affairs as at 31 March 2024 and of its loss 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.
STRATTON MOTOR COMPANY (NORFOLK) LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF STRATTON MOTOR COMPANY (NORFOLK) LIMITED (CONTINUED)
- 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.
Extent to which the audit was considered capable of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud.
Our procedures are developed based on risks identified from our knowledge of the entity, its environment, the significant laws and regulations governing its activities and of the related parties and service organisations connected with it. We also consider how the systems and controls the entity has put in place over its activities might mitigate risks identified.
In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we undertook procedures which included, but were not limited to:
- Enquiry of management, those charged with governance around actual and potential litigation and claims.
- Reviewing minutes of meetings of those charged with governance.
- Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations.
- Auditing the risk of management override of controls, including through testing journal entries and other adjustments for appropriateness.
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.
STRATTON MOTOR COMPANY (NORFOLK) LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF STRATTON MOTOR COMPANY (NORFOLK) LIMITED (CONTINUED)
- 6 -
Corresponding amounts presented for the year ended 31 March 2023 are unaudited on the basis that the company was exempt from the requirement to obtain an audit of its financial statements for that year.
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.
Paul Edwards FCCA CTA
Senior Statutory Auditor
For and on behalf of Afford Bond Holdings Limited
27 January 2025
Chartered Accountants
Statutory Auditor
31 Wellington Road
Nantwich
Cheshire
CW5 7ED
STRATTON MOTOR COMPANY (NORFOLK) LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2024
- 7 -
2024
2023
Notes
£
£
Turnover
3
12,390,849
11,869,075
Cost of sales
(10,763,230)
(10,067,423)
Gross profit
1,627,619
1,801,652
Administrative expenses
(1,283,497)
(1,094,934)
Other operating income
875
5,250
Operating profit
4
344,997
711,968
Interest receivable and similar income
7
2,274
489
Interest payable and similar expenses
8
(69,344)
(79,062)
Profit before taxation
277,927
633,395
Current taxation
(7,253)
Deferred taxation
(273,457)
Tax on profit
9
(280,710)
(Loss)/profit for the financial year
(2,783)
633,395
STRATTON MOTOR COMPANY (NORFOLK) LIMITED
BALANCE SHEET
AS AT
31 MARCH 2024
31 March 2024
- 8 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
10
2,185,392
2,080,546
Investments
11
27,666
27,666
2,213,058
2,108,212
Current assets
Stocks
13
2,096,183
1,997,637
Debtors
14
1,481,851
1,071,559
Cash at bank and in hand
1,285,639
563,345
4,863,673
3,632,541
Creditors: amounts falling due within one year
15
(3,077,729)
(1,760,546)
Net current assets
1,785,944
1,871,995
Total assets less current liabilities
3,999,002
3,980,207
Creditors: amounts falling due after more than one year
16
(1,091,244)
(1,343,123)
Provisions for liabilities
Deferred tax liability
19
273,457
(273,457)
-
Net assets
2,634,301
2,637,084
Capital and reserves
Called up share capital
21
50,100
50,100
Revaluation reserve
273,198
273,198
Profit and loss reserves
2,311,003
2,313,786
Total equity
2,634,301
2,637,084
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 27 January 2025 and are signed on its behalf by:
R Bennington
Director
Company registration number 01060893 (England and Wales)
STRATTON MOTOR COMPANY (NORFOLK) LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2024
- 9 -
Share capital
Revaluation reserve
Profit and loss reserves
Total
£
£
£
£
Balance at 1 April 2022
50,100
273,198
1,680,391
2,003,689
Year ended 31 March 2023:
Profit and total comprehensive income
-
-
633,395
633,395
Balance at 31 March 2023
50,100
273,198
2,313,786
2,637,084
Year ended 31 March 2024:
Loss and total comprehensive income
-
-
(2,783)
(2,783)
Balance at 31 March 2024
50,100
273,198
2,311,003
2,634,301
STRATTON MOTOR COMPANY (NORFOLK) LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2024
- 10 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
23
1,062,831
1,181,134
Interest paid
(69,344)
(79,062)
Net cash inflow from operating activities
993,487
1,102,072
Investing activities
Purchase of tangible fixed assets
(273,917)
(1,094,195)
Interest received
2,274
489
Net cash used in investing activities
(271,643)
(1,093,706)
Financing activities
Proceeds from borrowings
249,879
Repayment of borrowings
(16,535)
Repayment of bank loans
(232,306)
(221,091)
Payment of finance leases obligations
(17,123)
(27,113)
Net cash generated from/(used in) financing activities
450
(264,739)
Net increase/(decrease) in cash and cash equivalents
722,294
(256,373)
Cash and cash equivalents at beginning of year
563,345
819,718
Cash and cash equivalents at end of year
1,285,639
563,345
STRATTON MOTOR COMPANY (NORFOLK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
- 11 -
1
Accounting policies
Company information
Stratton Motor Company (Norfolk) Limited is a private company limited by shares incorporated in England and Wales. The registered office is Rotherwood, Ipswich Road, Long Stratton, Norfolk, NR15 2XJ.
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 company has taken advantage of the exemption under section 399 of the Companies Act 2006 not to prepare consolidated accounts, on the basis that the group of which this is the parent qualifies as a small group. The financial statements present information about the company as an individual entity and not about its group.
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 represents amounts receivable for goods and services net of VAT and trade discounts.
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.
Tangible fixed assets are stated at cost or valuation less depreciation. Depreciation is provided at rates calculated to write off the cost or valuation less estimated residual value of each asset over its expected useful life, as follows:
Land and buildings Freehold
10% p a on a reducing balance basis
Plant and machinery
10-25% p a on a reducing balance basis
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
Fixed asset investments
Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
STRATTON MOTOR COMPANY (NORFOLK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 12 -
A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The company considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.
Entities in which the company has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.
1.6
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.
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.
STRATTON MOTOR COMPANY (NORFOLK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 13 -
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.
STRATTON MOTOR COMPANY (NORFOLK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 14 -
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.10
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.
STRATTON MOTOR COMPANY (NORFOLK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies
(Continued)
- 15 -
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.13
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
The company operates a defined contribution scheme for the benefit of its employees. Contributions payable are charged to the profit and loss account in the year they are payable.
1.15
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.
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.
Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.
1.16
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
STRATTON MOTOR COMPANY (NORFOLK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 16 -
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
An analysis of the company's turnover is as follows:
2024
2023
£
£
Turnover analysed by class of business
Retail motor trade
12,390,849
11,869,075
2024
2023
£
£
Other revenue
Interest income
2,274
489
4
Operating profit
2024
2023
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange (gains)/losses
(5,091)
1,165
Fees payable to the company's auditor for the audit of the company's financial statements
5,000
Depreciation of owned tangible fixed assets
169,071
148,235
Operating lease charges
50,000
47,667
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2024
2023
Number
Number
Production, sales and adminstration
37
38
STRATTON MOTOR COMPANY (NORFOLK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
5
Employees
(Continued)
- 17 -
Their aggregate remuneration comprised:
2024
2023
£
£
Wages and salaries
907,855
870,328
Social security costs
78,349
79,849
Pension costs
20,478
20,927
1,006,682
971,104
6
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
70,000
100,000
7
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
840
489
Other interest income
1,434
Total income
2,274
489
2024
2023
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
840
489
8
Interest payable and similar expenses
2024
2023
£
£
Interest on financial liabilities measured at amortised cost:
Other interest on financial liabilities
69,344
79,062
9
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
7,253
STRATTON MOTOR COMPANY (NORFOLK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
9
Taxation
2024
2023
£
£
(Continued)
- 18 -
Deferred tax
Origination and reversal of timing differences
273,457
Total tax charge
280,710
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
277,927
633,395
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 19.00%)
69,482
120,345
Effect of change in corporation tax rate
65,630
Group relief
(77,474)
(40,747)
Permanent capital allowances in excess of depreciation
(26,008)
Depreciation on assets not qualifying for tax allowances
7,434
3,361
Deferred tax adjustments in respect of prior years
221,878
Other differences
(6,240)
(56,951)
Taxation charge for the year
280,710
-
STRATTON MOTOR COMPANY (NORFOLK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 19 -
10
Tangible fixed assets
Land and buildings Freehold
Plant and machinery
Total
£
£
£
Cost
At 1 April 2023
1,305,227
3,752,016
5,057,243
Additions
217,683
56,234
273,917
At 31 March 2024
1,522,910
3,808,250
5,331,160
Depreciation and impairment
At 1 April 2023
1,128,892
1,847,805
2,976,697
Depreciation charged in the year
29,737
139,334
169,071
At 31 March 2024
1,158,629
1,987,139
3,145,768
Carrying amount
At 31 March 2024
364,281
1,821,111
2,185,392
At 31 March 2023
176,335
1,904,211
2,080,546
11
Fixed asset investments
2024
2023
Notes
£
£
Investments in subsidiaries
12
27,666
27,666
12
Subsidiaries
Details of the company's subsidiaries at 31 March 2024 are as follows:
Name of undertaking
Address
Class of
% Held
shares held
Direct
Heritage Racing Support Limited
See ref 1 below
Ordinary
90.00
Registered office addresses (all UK unless otherwise indicated):
1
Rotherwood, Ipswich Road, Long Stratton, Norfolk, NR15 2XJ
The aggregate capital and reserves and the result for the year of the subsidiaries noted above was as follows:
Name of undertaking
Capital and Reserves
Profit/(Loss)
£
£
Heritage Racing Support Limited
175,144
(67,083)
STRATTON MOTOR COMPANY (NORFOLK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 20 -
13
Stocks
2024
2023
£
£
Raw materials and consumables
142,525
111,242
Work in progress
116,825
113,238
Finished goods and goods for resale
1,836,833
1,773,157
2,096,183
1,997,637
14
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
1,055,478
623,004
Corporation tax recoverable
18,782
Other debtors
399,548
424,222
Prepayments and accrued income
26,825
5,551
1,481,851
1,071,559
15
Creditors: amounts falling due within one year
2024
2023
Notes
£
£
Bank loans
17
246,056
233,618
Obligations under finance leases
18
7,135
17,123
Other borrowings
17
277,853
27,974
Trade creditors
1,785,111
668,003
Corporation tax
7,253
Other taxation and social security
116,891
23,820
Other creditors
630,738
744,085
Accruals and deferred income
6,692
45,923
3,077,729
1,760,546
16
Creditors: amounts falling due after more than one year
2024
2023
Notes
£
£
Bank loans and overdrafts
17
1,091,244
1,335,988
Obligations under finance leases
18
7,135
1,091,244
1,343,123
STRATTON MOTOR COMPANY (NORFOLK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 21 -
17
Loans and overdrafts
2024
2023
£
£
Bank loans
1,337,300
1,569,606
Other loans
277,853
27,974
1,615,153
1,597,580
Payable within one year
523,909
261,592
Payable after one year
1,091,244
1,335,988
The bank & other loans are secured by a charge over the company's assets and director guarantees on properties owned personally.
18
Finance lease obligations
2024
2023
Future minimum lease payments due under finance leases:
£
£
Within one year
7,135
17,123
In two to five years
7,135
7,135
24,258
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 3 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
19
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
273,457
-
2024
Movements in the year:
£
Liability at 1 April 2023
-
Charge to profit or loss
273,457
Liability at 31 March 2024
273,457
STRATTON MOTOR COMPANY (NORFOLK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
- 22 -
20
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
20,478
20,927
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.
21
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
50,100
50,100
50,100
50,100
22
Related party transactions
Remuneration of key management personnel
The remuneration of key management personnel is as follows.
2024
2023
£
£
Aggregate compensation
70,000
100,000
Transactions with related parties
During the year the company entered into the following transactions with related parties:
Sales
Purchases
2024
2023
2024
2023
£
£
£
£
Entities over which the entity has control, joint control or significant influence
48,740
100,275
363
4,355
Rent payable
2024
2023
£
£
Key management personnel
25,000
25,000
The following amounts were outstanding at the reporting end date:
2024
2023
Amounts due to related parties
£
£
Key management personnel
310,315
518,480
STRATTON MOTOR COMPANY (NORFOLK) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
22
Related party transactions
(Continued)
- 23 -
The following amounts were outstanding at the reporting end date:
2024
2023
Amounts due from related parties
£
£
Entities over which the entity has control, joint control or significant influence
375,273
325,211
23
Cash generated from operations
2024
2023
£
£
(Loss)/profit for the year after tax
(2,783)
633,395
Adjustments for:
Taxation charged
280,710
Finance costs
69,344
79,062
Investment income
(2,274)
(489)
Depreciation and impairment of tangible fixed assets
169,071
148,235
Movements in working capital:
(Increase)/decrease in stocks
(98,546)
334,097
(Increase)/decrease in debtors
(410,292)
31,027
Increase/(decrease) in creditors
1,057,601
(44,193)
Cash generated from operations
1,062,831
1,181,134
24
Analysis of changes in net debt
1 April 2023
Cash flows
31 March 2024
£
£
£
Cash at bank and in hand
563,345
722,294
1,285,639
Borrowings excluding overdrafts
(1,597,580)
(17,573)
(1,615,153)
Obligations under finance leases
(24,258)
17,123
(7,135)
(1,058,493)
721,844
(336,649)
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