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COMPANY REGISTRATION NUMBER: 00897155
Springmasters Limited
Consolidated Financial Statements
31 May 2024
Springmasters Limited
Consolidated Financial Statements
Year ended 31 May 2024
Contents
Page
Strategic report
1
Directors' report
2
Independent auditor's report to the members
4
Consolidated statement of comprehensive income
8
Consolidated statement of financial position
9
Company statement of financial position
10
Consolidated statement of changes in equity
11
Company statement of changes in equity
12
Consolidated statement of cash flows
13
Notes to the consolidated financial statements
14
Springmasters Limited
Strategic Report
Year ended 31 May 2024
During the year under review the parent company's principal activity continued to be spring presswork. The group's turnover increased slightly to £8,916,338 (2023 - £8,789,691) and operating profit increased to £1,414,069 (2023 - £1,190,622). The increase in operating profit was partially as a result of listed investments having increased in value during the year by £505,789 compared to a decrease of £136,609 in the previous year. The principal activity of the group's 100% subsidiary during the year continued to be the distribution of disc springs. The turnover increased to £1,588,593 (2023 - £1,566,834) and the profit before tax to £434,138 (2023 - £421,336).
The principal risks and uncertainties faced by the group are brought about by the increase in costs of selling abroad, and also bringing goods into the UK. The directors have implemented working practices to ensure that relationships with customers and suppliers within the EU remains good. The directors believe that the group is financially sound and should be able to overcome any problems.
We consider that our key financial performance indicators are those that communicate the financial performance and strength of the group as a whole these being turnover, net profit and retained profits: Turnover increased to £8,916,338 from £8,789,691. Net profit before taxation increased to £1,808,687 from £1,356,055. Net profit after taxation increased to £1,459,557 from £1,237,402.
This report was approved by the board of directors on 24 February 2025 and signed on behalf of the board by:
I R Whitehead Director
Registered office:
Arthur Street
Redditch
Worcs
B98 8JY
Springmasters Limited
Directors' Report
Year ended 31 May 2024
The directors present their report and the consolidated financial statements of the group for the year ended 31 May 2024 .
Directors
The directors who served the company during the year were as follows:
E Whitehead
I R Whitehead
C D Jackson
Dividends
Particulars of recommended dividends are detailed in note 14 to the consolidated financial statements.
Events after the end of the reporting period
Particulars of events after the reporting date are detailed in note 30 to the consolidated financial statements.
Research and development
In an effort to maintain its reputation as one of Europe's leading spring manufacturers the company is currently undertaking research and development to further develop and improve products.
Directors' responsibilities statement
The directors are responsible for preparing the strategic report, directors' report and the consolidated financial statements in accordance with applicable law and regulations. Company law requires the directors to prepare consolidated financial statements for each financial year. Under that law the directors have elected to prepare the consolidated 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 consolidated financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the group and the company and the profit or loss of the group for that period. In preparing these consolidated financial statements, the directors are required to: - select suitable accounting policies and then apply them consistently; - make judgments and accounting estimates that are reasonable and prudent; - prepare the consolidated 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 consolidated 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. Auditor
Each of the persons who is a director at the date of approval of this report confirms that:
- so far as they are aware, there is no relevant audit information of which the group and the company's auditor is unaware; and - they have taken all steps that they ought to have taken as a director to make themselves aware of any relevant audit information and to establish that the group and the company's auditor is aware of that information. The auditor is deemed to have been re-appointed in accordance with section 487 of the Companies Act 2006.
This report was approved by the board of directors on 24 February 2025 and signed on behalf of the board by:
I R Whitehead Director
Registered office:
Arthur Street
Redditch
Worcs
B98 8JY
Springmasters Limited
Independent Auditor's Report to the Members of Springmasters Limited
Year ended 31 May 2024
Opinion
We have audited the consolidated financial statements of Springmasters Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 May 2024 which comprise the consolidated statement of comprehensive income, consolidated statement of financial position, company statement of financial position, consolidated statement of changes in equity, company statement of changes in equity, consolidated statement of cash flows and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice). In our opinion the consolidated financial statements: - give a true and fair view of the state of the group's and of the parent company's affairs as at 31 May 2024 and of the group's profit for the year then ended; - have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; - have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the auditor's responsibilities for the audit of the consolidated financial statements section of our report. We are independent of the group in accordance with the ethical requirements that are relevant to our audit of the consolidated 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 consolidated financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the consolidated 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 group's or the parent company's ability to continue as a going concern for a period of at least twelve months from when the consolidated financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
Other information
The other information comprises the information included in the annual report, other than the consolidated financial statements and our auditor’s report thereon. The directors are responsible for the other information. Our opinion on the consolidated 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. In connection with our audit of the consolidated financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in 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 there is a material misstatement in the consolidated financial statements or a material misstatement of the other information. 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 the 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.
Matters on which we are required to report by exception
In the light of our 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 and the Directors' Report. We have nothing to report in respect of the following matters where 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 the returns; or - certain disclosures of directors 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 consolidated 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 consolidated financial statements that are free from material misstatement, whether due to fraud or error. In preparing the consolidated financial statements, the directors are responsible for assessing the group's and the parent 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 group or the parent company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the consolidated financial statements
Our objectives are to obtain reasonable assurance about whether the consolidated 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 consolidated 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: - The partner ensured that the audit team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations; - We identified the laws and regulations applicable to the group through discussions with directors, and from our commercial knowledge and years of experience of the spring manufacturing and supply sector. We determined that the following laws and regulations may have a direct material effect on the financial statements or the operations of the group, including the Companies Act 2006, taxation legislation and data protection, anti-bribery, employment, environmental and health and safety legislation; and - We assessed the extent of compliance with the laws and regulations identified above making enquiries of directors and reviewing legal and other correspondence. The audit team remained alert to any instances of non-compliance throughout the audit. - We assessed the susceptibility of the group's financial statements to material misstatement, including obtaining an understanding of how fraud might occur. Audit procedures performed by the engagement team included: - Considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations; - Making enquiries of directors as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; - Performed analytical procedures to identify any unusual or unexpected relationships; - Tested journal entries to identify unusual transactions and investigated the rationale behind significant or unusual transactions; and - Assessed whether assumptions and judgements made by directors in its accounting estimates were indicative of potential bias. There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and the inspection of regulatory and legal correspondence, if any. Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion. As part of an audit in accordance with ISAs (UK), we exercise professional judgment and maintain professional scepticism throughout the audit. We also: - Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. - Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the group's internal control. - Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors. - Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the group's or the parent company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the group or the parent company to cease to continue as a going concern. - Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation. - Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the group to express an opinion on the consolidated consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. Use of our report
This report is made solely to the company's members, as a body, in accordance with chapter 3 of part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.
Michael Holder
(Senior Statutory Auditor)
For and on behalf of
Rigbey Harrison
Chartered accountants & statutory auditor
4 Church Green East,
Redditch,
Worcs,
B98 8BT
24 February 2025
Springmasters Limited
Consolidated Statement of Comprehensive Income
Year ended 31 May 2024
2024
2023
Note
£
£
Turnover
4
8,916,338
8,789,691
Cost of sales
4,570,036
4,408,517
------------
------------
Gross profit
4,346,302
4,381,174
Distribution costs
211,345
194,175
Administrative expenses
3,260,542
2,895,004
Other operating income
5
539,654
( 101,373)
------------
------------
Operating profit
6
1,414,069
1,190,622
Income from other fixed asset investments
10
20,122
14,615
Other interest receivable and similar income
11
380,423
156,264
Interest payable and similar expenses
12
5,927
5,446
------------
------------
Profit before taxation
1,808,687
1,356,055
Tax on profit
13
349,130
118,653
------------
------------
Profit for the financial year and total comprehensive income
1,459,557
1,237,402
------------
------------
All the activities of the group are from continuing operations.
Springmasters Limited
Consolidated Statement of Financial Position
31 May 2024
2024
2023
Note
£
£
Fixed assets
Tangible assets
15
3,643,889
3,633,489
Investments
16
4,458,329
4,003,266
------------
------------
8,102,218
7,636,755
Current assets
Stocks
17
1,240,062
1,199,932
Debtors
18
1,992,477
1,945,376
Investments
19
7,864,157
6,709,279
Cash at bank and in hand
1,825,731
1,496,897
-------------
-------------
12,922,427
11,351,484
Creditors: amounts falling due within one year
20
4,835,289
3,394,105
-------------
-------------
Net current assets
8,087,138
7,957,379
-------------
-------------
Total assets less current liabilities
16,189,356
15,594,134
Provisions
Taxation including deferred tax
21
794,346
661,541
-------------
-------------
Net assets
15,395,010
14,932,593
-------------
-------------
Capital and reserves
Called up share capital
26
6,311
6,311
Revaluation reserve
27
327,187
329,719
Capital redemption reserve
27
3,689
3,689
Profit and loss account
27
15,057,823
14,592,874
-------------
-------------
Shareholders funds
15,395,010
14,932,593
-------------
-------------
These consolidated financial statements have been prepared in accordance with the provisions applicable to companies subject to the medium companies regime.
These consolidated financial statements were approved by the board of directors and authorised for issue on 24 February 2025 , and are signed on behalf of the board by:
I R Whitehead Director
Company registration number: 00897155
Springmasters Limited
Company Statement of Financial Position
31 May 2024
2024
2023
Note
£
£
Fixed assets
Tangible assets
15
3,629,373
3,614,134
Investments
16
4,622,804
4,167,741
------------
------------
8,252,177
7,781,875
Current assets
Stocks
17
1,240,062
1,199,932
Debtors
18
1,698,232
1,644,448
Investments
19
7,864,157
6,709,279
Cash at bank and in hand
1,810,529
1,463,888
-------------
-------------
12,612,980
11,017,547
Creditors: amounts falling due within one year
20
6,574,896
4,778,993
-------------
-------------
Net current assets
6,038,084
6,238,554
-------------
-------------
Total assets less current liabilities
14,290,261
14,020,429
Provisions
Taxation including deferred tax
21
795,252
662,233
-------------
-------------
Net assets
13,495,009
13,358,196
-------------
-------------
Capital and reserves
Called up share capital
26
6,311
6,311
Revaluation reserve
27
327,187
329,719
Capital redemption reserve
27
3,689
3,689
Profit and loss account
27
13,157,822
13,018,477
-------------
-------------
Shareholders funds
13,495,009
13,358,196
-------------
-------------
The profit for the financial year of the parent company was £ 1,133,953 (2023: £ 900,265 ).
These consolidated financial statements have been prepared in accordance with the provisions applicable to companies subject to the medium companies regime.
These consolidated financial statements were approved by the board of directors and authorised for issue on 24 February 2025 , and are signed on behalf of the board by:
I R Whitehead Director
Company registration number: 00897155
Springmasters Limited
Consolidated Statement of Changes in Equity
Year ended 31 May 2024
Called up share capital
Revaluation reserve
Capital redemption reserve
Profit and loss account
Total
£
£
£
£
£
At 1 June 2022
6,311
332,251
3,689
13,352,940
13,695,191
Profit for the year
1,237,402
1,237,402
Other comprehensive income for the year:
Reclassification from revaluation reserve to profit and loss account
( 2,532)
2,532
-------
---------
-------
-------------
-------------
Total comprehensive income for the year
( 2,532)
1,239,934
1,237,402
At 31 May 2023
6,311
329,719
3,689
14,592,874
14,932,593
Profit for the year
1,459,557
1,459,557
Other comprehensive income for the year:
Reclassification from revaluation reserve to profit and loss account
( 2,532)
2,532
-------
---------
-------
-------------
-------------
Total comprehensive income for the year
( 2,532)
1,462,089
1,459,557
Dividends paid and payable
14
( 997,140)
( 997,140)
----
----
----
---------
---------
Total investments by and distributions to owners
( 997,140)
( 997,140)
-------
---------
-------
-------------
-------------
At 31 May 2024
6,311
327,187
3,689
15,057,823
15,395,010
-------
---------
-------
-------------
-------------
Springmasters Limited
Company Statement of Changes in Equity
Year ended 31 May 2024
Called up share capital
Revaluation reserve
Capital redemption reserve
Profit and loss account
Total
£
£
£
£
£
At 1 June 2022
6,311
332,251
3,689
12,115,680
12,457,931
Profit for the year
900,265
900,265
Other comprehensive income for the year:
Reclassification from revaluation reserve to profit and loss account
( 2,532)
2,532
-------
---------
-------
-------------
-------------
Total comprehensive income for the year
( 2,532)
902,797
900,265
At 31 May 2023
6,311
329,719
3,689
13,018,477
13,358,196
Profit for the year
1,133,953
1,133,953
Other comprehensive income for the year:
Reclassification from revaluation reserve to profit and loss account
( 2,532)
2,532
-------
---------
-------
-------------
-------------
Total comprehensive income for the year
( 2,532)
1,136,485
1,133,953
Dividends paid and payable
14
( 997,140)
( 997,140)
----
----
----
---------
---------
Total investments by and distributions to owners
( 997,140)
( 997,140)
-------
---------
-------
-------------
-------------
At 31 May 2024
6,311
327,187
3,689
13,157,822
13,495,009
-------
---------
-------
-------------
-------------
Springmasters Limited
Consolidated Statement of Cash Flows
Year ended 31 May 2024
2024
2023
£
£
Cash flows from operating activities
Profit for the financial year
1,459,557
1,237,402
Adjustments for:
Depreciation of tangible assets
334,541
312,344
Income from other fixed asset investments
( 20,122)
( 14,615)
Other interest receivable and similar income
( 380,423)
( 156,264)
Interest payable and similar expenses
5,927
5,446
Gains on disposal of tangible assets
( 7,880)
( 1,102)
Tax on profit
349,130
118,653
Fair value adjustment for listed investments
(505,789)
136,609
Loss on disposal of investments
4,673
18,537
Changes in:
Stocks
( 40,130)
( 16,174)
Trade and other debtors
61,497
248,746
Trade and other creditors
1,351,902
( 346,171)
------------
------------
Cash generated from operations
2,612,883
1,543,411
Interest paid
( 5,927)
( 5,446)
Interest received
271,825
81,514
Tax paid
( 127,043)
( 42,514)
------------
------------
Net cash from operating activities
2,751,738
1,576,965
------------
------------
Cash flows from investing activities
Purchase of tangible assets
( 352,061)
( 429,423)
Proceeds from sale of tangible assets
15,000
27,100
Purchases of other investments
( 1,329,934)
( 2,707,770)
Proceeds from sale of other investments
221,109
67,565
Dividends received
20,122
14,615
------------
------------
Net cash used in investing activities
( 1,425,764)
( 3,027,913)
------------
------------
Cash flows from financing activities
Dividends paid
( 997,140)
------------
------------
Net cash used in financing activities
( 997,140)
------------
------------
Net increase/(decrease) in cash and cash equivalents
328,834
( 1,450,948)
Cash and cash equivalents at beginning of year
1,496,897
2,947,845
------------
------------
Cash and cash equivalents at end of year
1,825,731
1,496,897
------------
------------
Springmasters Limited
Notes to the Consolidated Financial Statements
Year ended 31 May 2024
1. General information
The company is a private company limited by shares, registered in England and Wales. The address of the registered office is Arthur Street, Redditch, Worcs, B98 8JY.
2. Statement of compliance
These consolidated financial statements have been prepared in compliance with FRS 102, 'The Financial Reporting Standard applicable in the UK and the Republic of Ireland'.
3. Accounting policies
Basis of preparation
The consolidated financial statements have been prepared on the historical cost basis, as modified by the revaluation of certain financial assets and liabilities and investment properties measured at fair value through profit or loss.
The consolidated financial statements are prepared in sterling, which is the functional currency of the entity.
Disclosure exemptions
The parent company satisfies the criteria of being a qualifying entity as defined in FRS 102. As such, advantage has been taken of the following reduced disclosures available under FRS 102:
(a) Disclosures in respect of each class of share capital have not been presented.
(b) No cash flow statement has been presented for the company.
(c) Disclosures in respect of financial instruments have not been presented.
(d) No disclosure has been given for the aggregate remuneration of key management personnel.
Consolidation
The consolidated financial statements incorporate the financial statements of the company and all group undertakings. As a consolidated profit and loss account is published, a separate profit and loss account for the parent company is omitted from the group financial statements by virtue of section 408 of the Companies Act 2006.
Judgements and key sources of estimation uncertainty
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported for assets and liabilities as at the balance sheet date and the amounts reported for revenues and expenses during the year. However, the nature of estimation means that actual outcomes could differ from those estimates. The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements: Valuation of investment properties Stock provision judgemental % deemed appropriate by management
Revenue recognition
Turnover is measured at the fair value of the consideration received or receivable and represents amounts receivable for goods supplied stated net of discounts and of Value Added Tax. Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have transferred to the buyer, usually on despatch of the goods, the amount of revenue can be measured reliably, it is probable that the associated economic benefits will flow to the entity, and the costs incurred or to be incurred in respect of the transactions can be measured reliably.
Tax
Current tax represents the amount of tax payable or receivable in respect of the taxable profit for the current and past periods. Current tax is measured at the amounts of tax expected to pay or recover using the tax rates and laws that have been enacted or substantively enacted at the reporting date. Deferred tax is recognised in respect of all timing differences at the reporting date. Unrelieved tax losses and other 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. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date that are expected to apply to the reversal of the timing difference.
Foreign currencies
Foreign currency transactions are initially recorded in the functional currency, by applying the spot exchange rate as at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the exchange rate ruling at the reporting date, with any gains or losses being taken to the profit and loss account.
Operating leases
Lease payments are recognised as an expense over the lease term on a straight-line basis. The aggregate benefit of lease incentives is recognised as a reduction to expense over the lease term, on a straight-line basis. Lease income is recognised in profit or loss on a straight line basis over the lease term.
Tangible assets
Tangible assets are initially recorded at cost, and subsequently stated at cost less any accumulated depreciation and impairment losses. Any tangible assets carried at revalued amounts are recorded at the fair value at the date of revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses.
Depreciation
Depreciation is calculated so as to write off the cost or valuation of an asset, less its residual value, over the useful economic life of that asset as follows:
Buildings
-
2% straight line
Equipment
-
5 - 10 years straight line or 15% or 25% reducing balance
Fixtures and fittings
-
15% or 25% reducing balance
Motor vehicles
-
25% reducing balance
An amount equal to the excess of the annual depreciation charge on revalued assets over the original cost depreciation charge on those assets is transferred annually from the revaluation reserve to retained earnings.
Investment property
Investment properties are measured at fair value at each reporting date with changes in fair value recognised in profit or loss.
Investments
Listed investments are measured at fair value with changes in fair value being recognised in profit or loss.
Investments in subsidiaries are accounted for at cost less impairment.
Impairment of fixed assets
A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date.
Research and development
Research and development expenditure is written off in the period in which it is incurred.
Stocks
Stocks are measured at the lower of cost and estimated selling price less costs to complete and sell. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing the stock to its present location and condition.
Provisions
Provisions are recognised when the entity has an obligation at the reporting date as a result of a past event, it is probable that the entity will be required to transfer economic benefits in settlement and the amount of the obligation can be estimated reliably.
Financial instruments
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into, either as financial assets, financial liabilities or equity interests. An equity instrument is any contract that evidences a residual interest in the assets of the entity after deducting all of its financial liabilities. Debtors and creditors with no stated interest rate and receivable or payable within one year are recorded at transaction price. Any losses arising from impairment are recognised in the profit and loss account in administrative expenses.
Employee benefits
When employees have rendered service to the company, short-term employee benefits to which the employees are entitled are recognised at the undiscounted amount expected to be paid in exchange for that service. The company operates a defined contribution plan for the benefit of its employees. Contributions are recognised as an expense in the period in which the related service is provided.
4. Turnover
Turnover arises from:
2024
2023
£
£
Sale of goods
8,916,338
8,789,691
------------
------------
The turnover is attributable to the one principal activity of the group. An analysis of turnover by the geographical markets that substantially differ from each other is given below:
2024
2023
£
£
United Kingdom
7,528,505
7,252,580
Overseas
1,387,833
1,537,111
------------
------------
8,916,338
8,789,691
------------
------------
5. Other operating income
2024
2023
£
£
Rental income
33,865
35,236
Fair value adjustment for listed investments
505,789
( 136,609)
---------
---------
539,654
( 101,373)
---------
---------
6. Operating profit
Operating profit or loss is stated after charging/crediting:
2024
2023
£
£
Depreciation of tangible assets
334,541
312,344
Gains on disposal of tangible assets
( 7,880)
( 1,102)
Impairment of trade debtors
(387)
(2,514)
Foreign exchange differences
9,728
1,249
(Profit)/loss on fair value movement of investments
( 505,789)
136,609
Loss on disposal of investments
4,673
18,537
---------
---------
7. Auditor's remuneration
2024
2023
£
£
Fees payable for the audit of the consolidated financial statements
50,000
40,200
--------
--------
8. Staff costs
The average number of persons employed by the group during the year, including the directors, amounted to:
2024
2023
No.
No.
Production staff
67
68
Distribution staff
28
29
Administrative staff
7
7
Management staff
3
3
----
----
105
107
----
----
The aggregate payroll costs incurred during the year, relating to the above, were:
2024
2023
£
£
Wages and salaries
3,630,034
3,298,915
Social security costs
369,879
328,816
Other pension costs
115,235
110,149
------------
------------
4,115,148
3,737,880
------------
------------
9. Directors' remuneration
The directors' aggregate remuneration in respect of qualifying services was:
2024
2023
£
£
Remuneration
722,547
508,086
Company contributions to defined contribution pension plans
7,758
4,760
---------
---------
730,305
512,846
---------
---------
The number of directors who accrued benefits under company pension plans was as follows:
2024
2023
No.
No.
Defined contribution plans
1
1
----
----
Remuneration of the highest paid director in respect of qualifying services:
2024
2023
£
£
Aggregate remuneration
617,813
398,827
---------
---------
10. Income from other fixed asset investments
2024
2023
£
£
Income from other fixed asset investments
20,122
14,615
--------
--------
11. Other interest receivable and similar income
2024
2023
£
£
Interest on cash and cash equivalents
380,423
153,169
Other interest receivable and similar income
3,095
---------
---------
380,423
156,264
---------
---------
12. Interest payable and similar expenses
2024
2023
£
£
Other interest payable and similar charges
5,927
5,446
-------
-------
13. Tax on profit
Major components of tax expense
2024
2023
£
£
Current tax:
UK current tax expense
214,786
168,289
Adjustments in respect of prior periods
1,539
( 41,246)
---------
---------
Total current tax
216,325
127,043
---------
---------
Deferred tax:
Origination and reversal of timing differences
132,805
( 8,390)
---------
---------
Tax on profit
349,130
118,653
---------
---------
The corporation tax rate was 25% throughout the year (2023-19% to 31st March 2023 and 25% from 1st April 2023). The deferred tax charge at 31 May 2024 has been calculated based on the rate at the year end.
Reconciliation of tax expense
The tax assessed on the profit on ordinary activities for the year is lower than (2023: lower than) the standard rate of corporation tax in the UK of 25 % (2023: 20 %).
2024
2023
£
£
Profit on ordinary activities before taxation
1,808,687
1,356,055
------------
------------
Profit on ordinary activities by rate of tax
452,171
271,222
Adjustment to tax charge in respect of prior periods
1,539
( 41,246)
Effect of expenses not deductible for tax purposes
384
8
Effect of capital allowances and depreciation
3,874
( 945)
Effect of revenue exempt from tax
( 5,030)
( 2,923)
Investment income
( 104,976)
( 104,352)
Difference in tax rates
( 6,818)
Effect of disposal of investments
1,168
3,707
------------
------------
Tax on profit
349,130
118,653
------------
------------
14. Dividends
2024
2023
£
£
Dividends paid during the year (excluding those for which a liability existed at the end of the prior year )
997,140
---------
----
15. Tangible assets
Group
Freehold Property
Equipment
Fixtures and Fittings
Motor Vehicles
Investment Property
Total
£
£
£
£
£
£
Cost/Valuation
At 1 Jun 2023
574,162
6,469,818
25,289
244,205
1,823,250
9,136,724
Additions
298,543
53,518
352,061
Disposals
( 83,293)
( 71,130)
( 154,423)
---------
------------
--------
---------
------------
------------
At 31 May 2024
574,162
6,685,068
25,289
226,593
1,823,250
9,334,362
---------
------------
--------
---------
------------
------------
Depreciation
At 1 Jun 2023
188,856
5,123,536
24,526
166,317
5,503,235
Charge for the year
10,322
293,033
115
31,071
334,541
Disposals
( 83,293)
( 64,010)
( 147,303)
---------
------------
--------
---------
------------
------------
At 31 May 2024
199,178
5,333,276
24,641
133,378
5,690,473
---------
------------
--------
---------
------------
------------
Carrying amount
At 31 May 2024
374,984
1,351,792
648
93,215
1,823,250
3,643,889
---------
------------
--------
---------
------------
------------
At 31 May 2023
385,306
1,346,282
763
77,888
1,823,250
3,633,489
---------
------------
--------
---------
------------
------------
Company
Freehold Property
Equipment
Fixtures and Fittings
Motor Vehicles
Investment Property
Total
£
£
£
£
£
£
Cost/Valuation
At 1 Jun 2023
574,162
6,469,818
9,892
209,795
1,823,250
9,086,917
Additions
298,543
53,518
352,061
Disposals
( 83,293)
( 71,130)
( 154,423)
---------
------------
-------
---------
------------
------------
At 31 May 2024
574,162
6,685,068
9,892
192,183
1,823,250
9,284,555
---------
------------
-------
---------
------------
------------
Depreciation
At 1 Jun 2023
188,856
5,123,536
9,129
151,262
5,472,783
Charge for the year
10,322
293,033
115
26,232
329,702
Disposals
( 83,293)
( 64,010)
( 147,303)
---------
------------
-------
---------
------------
------------
At 31 May 2024
199,178
5,333,276
9,244
113,484
5,655,182
---------
------------
-------
---------
------------
------------
Carrying amount
At 31 May 2024
374,984
1,351,792
648
78,699
1,823,250
3,629,373
---------
------------
-------
---------
------------
------------
At 31 May 2023
385,306
1,346,282
763
58,533
1,823,250
3,614,134
---------
------------
-------
---------
------------
------------
Investment properties were subject to valuation by the directors who are not professionally qualified valuers. The historical cost of investment properties held at fair value is £1,444,418 (2023 - £1,444,418).
Freehold property includes land with a value of £70,845 (2023 - £70,845) which is not depreciated.
Tangible assets held at valuation
Certain freehold land and buildings included above were previously recognised using an existing use open market value basis. These valuations have not been updated and were used as deemed cost on transition to FRS 102. These assets are being depreciated from their valuation date of 31st May 1984 and 31st May 1992 and have a net book value of £257,842 (2023 - ££263,726).
In respect of tangible assets held at valuation, aggregate cost, depreciation and comparable carrying amount that would have been recognised if the assets had been carried under the historical cost model are as follows:
Group and company
£
At 31 May 2024
Aggregate cost
231,107
Aggregate depreciation
(52,506)
---------
Carrying value
178,601
---------
At 31 May 2023
Aggregate cost
231,107
Aggregate depreciation
(49,156)
---------
Carrying value
181,951
---------
16. Investments
Group
Listed investments
£
Cost/Valuation
At 1 June 2023
4,003,266
Additions
175,056
Disposals
( 225,782)
Revaluations
505,789
------------
At 31 May 2024
4,458,329
------------
Impairment
At 1 June 2023 and 31 May 2024
------------
Carrying amount
At 31 May 2024
4,458,329
------------
At 31 May 2023
4,003,266
------------
Company
Shares in group undertakings
Listed investments
Total
£
£
£
Cost/Valuation
At 1 June 2023
164,475
4,003,266
4,167,741
Additions
175,056
175,056
Disposals
( 225,782)
( 225,782)
Revaluations
505,789
505,789
---------
------------
------------
At 31 May 2024
164,475
4,458,329
4,622,804
---------
------------
------------
Impairment
At 1 June 2023 and 31 May 2024
---------
------------
------------
Carrying amount
At 31 May 2024
164,475
4,458,329
4,622,804
---------
------------
------------
At 31 May 2023
164,475
4,003,266
4,167,741
---------
------------
------------
Listed investments
The fair value of listed investments is determined by reference to the quoted market price in an active market at the balance sheet date.
Interests in subsidiaries are measured at cost less impairment on the basis that they represent shares in entities that are not publicly traded and the fair value cannot otherwise be measured reliably.
Interests in subsidiaries
Details of the investments in which the group and the parent company have an interest of 20% or more are as follows:
Class of share
Percentage of shares held
Subsidiary undertakings
Belleville Springs Limited
Ordinary
100
The Valley Spring Company Limited
Ordinary
100
17. Stocks
Group
Company
2024
2023
2024
2023
£
£
£
£
Raw materials and consumables
515,978
502,463
515,978
502,463
Work in progress
23,577
39,167
23,577
39,167
Finished goods and goods for resale
700,507
658,302
700,507
658,302
------------
------------
------------
------------
1,240,062
1,199,932
1,240,062
1,199,932
------------
------------
------------
------------
18. Debtors
Group
Company
2024
2023
2024
2023
£
£
£
£
Trade debtors
1,494,836
1,438,373
1,210,433
1,145,098
Prepayments and accrued income
472,234
298,834
462,392
291,181
Other debtors
25,407
208,169
25,407
208,169
------------
------------
------------
------------
1,992,477
1,945,376
1,698,232
1,644,448
------------
------------
------------
------------
19. Investments
Group
Company
2024
2023
2024
2023
£
£
£
£
Other investments
7,864,157
6,709,279
7,864,157
6,709,279
------------
------------
------------
------------
These investments are bank term deposits. Included within other investments is £5,807,104 (2023: 2,500,000) which will mature after more than one year from the reporting date.
20. Creditors: amounts falling due within one year
Group
Company
2024
2023
2024
2023
£
£
£
£
Trade creditors
485,504
602,687
485,297
602,688
Amounts owed to group undertakings
1,879,912
1,505,716
Accruals and deferred income
296,124
179,688
287,352
169,754
Corporation tax
216,325
127,043
107,577
42,445
Social security and other taxes
765,539
616,091
753,398
599,591
Directors current accounts
809,427
443,123
809,427
443,123
Other creditors
2,262,370
1,425,473
2,251,933
1,415,676
------------
------------
------------
------------
4,835,289
3,394,105
6,574,896
4,778,993
------------
------------
------------
------------
There is an unlimited multilateral guarantee given by the group companies, held by the bank. Amounts owed to group undertakings are unsecured, interest free, have no fixed date of repayment and are repayable on demand.
21. Provisions
Group
Deferred tax (note 22)
£
At 1 June 2023
661,541
Origination and reversal of timing differences
6,358
Revaluation of investments
126,447
---------
At 31 May 2024
794,346
---------
Company
Deferred tax (note 22)
£
At 1 June 2023
662,233
Origination and reversal of timing differences
6,572
Revaluation of investments
126,447
---------
At 31 May 2024
795,252
---------
22. Deferred tax
The deferred tax included in the statement of financial position is as follows:
Group
Company
2024
2023
2024
2023
£
£
£
£
Included in provisions (note 21)
794,346
661,541
795,252
662,233
---------
---------
---------
---------
The deferred tax account consists of the tax effect of timing differences in respect of:
Group
Company
2024
2023
2024
2023
£
£
£
£
Accelerated capital allowances
317,086
310,728
317,992
311,420
Revaluation of tangible assets
36,176
36,176
36,176
36,176
Fair value adjustment of investment property
94,709
94,709
94,709
94,709
Other revaluations
346,375
219,928
346,375
219,928
---------
---------
---------
---------
794,346
661,541
795,252
662,233
---------
---------
---------
---------
The amount of the reversal of deferred tax expected to occur next year is £59,845 (2023 - £62,680), relating to the reversal of existing timing differences on tangible fixed assets. There is no expiry date on timing differences.
23. Employee benefits
Defined contribution plans
The amount recognised in profit or loss as an expense in relation to defined contribution plans was £ 115,235 (2023: £ 110,149 ).
24. Financial risk management
The group has exposures to one main area of risk:
Customer credit exposure
The group may offer credit terms to its customers which allow payment of the debt after delivery of the goods or services. The group is at risk to the extent that a customer may be unable to pay the debt on the specified due date. This risk is mitigated by the strong on-going customer relationships.
25. Financial instruments
The carrying amount for each category of financial instrument is as follows:
Financial assets measured at fair value through profit or loss
Group
Company
2024
2023
2024
2023
£
£
£
£
Financial assets measured at fair value through profit or loss
4,458,329
4,003,267
4,458,329
4,003,267
------------
------------
------------
------------
The change in fair value recognised in the profit for the year is a profit of £505,789 (2023 - Loss £136,609). Financial assets measured at fair value comprise of listed investments and are determined by reference to the quoted market price in an active market at the balance sheet date.
26. Called up share capital
Issued, called up and fully paid
2024
2023
No.
£
No.
£
Ordinary shares of £ 1 each
6,311
6,311
6,311
6,311
-------
-------
-------
-------
27. Reserves
Revaluation reserve - This reserve records the value of asset revaluations and fair value movements on assets recognised in other comprehensive income. Capital redemption reserve - This reserve records the nominal value of shares repurchased by the company. Profit and loss account - This reserve records retained earnings and accumulated losses.
28. Analysis of changes in net debt
At 1 Jun 2023
Cash flows
At 31 May 2024
£
£
£
Cash at bank and in hand
1,496,897
328,834
1,825,731
Current asset investments
6,709,279
1,154,878
7,864,157
------------
------------
------------
8,206,176
1,483,712
9,689,888
------------
------------
------------
29. Other financial commitments
Contractual commitments for the acquisition of tangible fixed assets contracted for but not provided in the financial statements amounted to £ 315,334 (2023 - £ 116,049 ).
Springmasters Limited
Notes to the Consolidated Financial Statements (continued)
Year ended 31 May 2024
30. Events after the end of the reporting period
The pressure from the rising cost of living continue to present challenges for this business and other similar businesses. Being conscious of the need to protect the environment and having previously installed solar panels, the company has acquired an electric vehicle and installed a nitrogen plant. It is expected that the profit before tax for the year ended 31 May 2025 will be similar to 2024.
31. Related party transactions
Group
Included in creditors is £809,427 (2023 - £443,123) owed to directors of the group and £2,067,719 (2023 - £1,331,982) owed to shareholders of the group.
Company
Included in creditors is £809,427 (2023 - £443,123) owed to directors of the company and £2,067,719 (2023 - £1,331,982) owed to shareholders of the company.