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Company No: 04833839 (England and Wales)

TRAFFORD TYRES LTD

Unaudited Financial Statements
For the financial year ended 31 May 2024
Pages for filing with the registrar

TRAFFORD TYRES LTD

Unaudited Financial Statements

For the financial year ended 31 May 2024

Contents

TRAFFORD TYRES LTD

BALANCE SHEET

As at 31 May 2024
TRAFFORD TYRES LTD

BALANCE SHEET (continued)

As at 31 May 2024
Note 2024 2023
£ £
Fixed assets
Intangible assets 4 13,854 17,179
Tangible assets 5 37,102 55,968
50,956 73,147
Current assets
Stocks 48,710 45,170
Debtors 6 682,753 638,080
Cash at bank and in hand 714,982 196,332
1,446,445 879,582
Creditors: amounts falling due within one year 7 ( 732,850) ( 504,460)
Net current assets 713,595 375,122
Total assets less current liabilities 764,551 448,269
Creditors: amounts falling due after more than one year 8 ( 13,701) ( 33,984)
Provision for liabilities ( 6,348) ( 12,947)
Net assets 744,502 401,338
Capital and reserves
Called-up share capital 1,100 1,100
Profit and loss account 743,402 400,238
Total shareholder's funds 744,502 401,338

For the financial year ending 31 May 2024 the Company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.

Director's responsibilities:

These financial statements have been prepared in accordance with the provisions of FRS 102 Section 1A – small entities. The financial statements of Trafford Tyres Ltd (registered number: 04833839) were approved and authorised for issue by the Director on 26 February 2025. They were signed on its behalf by:

M A Davies
Director
TRAFFORD TYRES LTD

NOTES TO THE FINANCIAL STATEMENTS

For the financial year ended 31 May 2024
TRAFFORD TYRES LTD

NOTES TO THE FINANCIAL STATEMENTS

For the financial year ended 31 May 2024
1. Accounting policies

The principal accounting policies are summarised below. They have all been applied consistently throughout the financial year and to the preceding financial year, unless otherwise stated.

General information and basis of accounting

Trafford Tyres Ltd (the Company) is a private company, limited by shares, incorporated in the United Kingdom under the Companies Act 2006 and is registered in England and Wales. The address of the Company's registered office is Carlyle House 78 Chorley New Road, Bolton, Lancashire, BL1 4BY, United Kingdom.

The financial statements have been prepared under the historical cost convention, modified to include certain items at fair value, and in accordance with Section 1A of Financial Reporting Standard 102 (FRS 102) ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland’ issued by the Financial Reporting Council and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime.

The financial statements are presented in pounds sterling which is the functional currency of the Company and rounded to the nearest £.

Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.

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.

Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.

Employee benefits

Short term 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.

Defined contribution schemes
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

Taxation

Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

Intangible assets

Intangible assets are stated at cost or valuation, net of amortisation and any provision for impairment. Amortisation is provided on all intangible assets at rates to write off the cost or valuation of each asset over its expected useful life as follows:

Goodwill 10 years straight line
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Plant and machinery 5 years straight line
Vehicles 5 years straight line
Fixtures and fittings 6.66 years straight line
Computer equipment 5 years straight line

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

Leases

The Company as lessee
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 leased asset are consumed.

Impairment of assets

At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

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.

Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

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.

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.

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.

2. Critical accounting judgements and key sources of estimation uncertainty

In the application of the Company’s accounting policies, the director is required to make judgements that have a significant impact on the amounts recognised. The following are the critical judgements that the director has made in the process of applying the Company’s accounting policies and that have the most significant effect on the amounts recognised in the financial statements.

3. Employees

2024 2023
Number Number
Monthly average number of persons employed by the Company during the year, including the director 9 8

4. Intangible assets

Goodwill Total
£ £
Cost
At 01 June 2023 33,250 33,250
At 31 May 2024 33,250 33,250
Accumulated amortisation
At 01 June 2023 16,071 16,071
Charge for the financial year 3,325 3,325
At 31 May 2024 19,396 19,396
Net book value
At 31 May 2024 13,854 13,854
At 31 May 2023 17,179 17,179

5. Tangible assets

Plant and machinery Vehicles Fixtures and fittings Computer equipment Total
£ £ £ £ £
Cost
At 01 June 2023 23,310 201,141 610 1,579 226,640
Additions 0 0 0 415 415
At 31 May 2024 23,310 201,141 610 1,994 227,055
Accumulated depreciation
At 01 June 2023 21,510 147,439 559 1,164 170,672
Charge for the financial year 600 18,472 16 193 19,281
At 31 May 2024 22,110 165,911 575 1,357 189,953
Net book value
At 31 May 2024 1,200 35,230 35 637 37,102
At 31 May 2023 1,800 53,702 51 415 55,968

6. Debtors

2024 2023
£ £
Trade debtors 619,933 542,382
Corporation tax 5,714 5,714
Other debtors 57,106 89,984
682,753 638,080

7. Creditors: amounts falling due within one year

2024 2023
£ £
Trade creditors 499,722 382,150
Taxation and social security 209,305 86,537
Obligations under finance leases and hire purchase contracts 10,058 23,213
Other creditors 13,765 12,560
732,850 504,460

8. Creditors: amounts falling due after more than one year

2024 2023
£ £
Bank loans 11,369 21,594
Obligations under finance leases and hire purchase contracts 2,332 12,390
13,701 33,984

9. Financial commitments

Commitments

Capital commitments are as follows:

2024 2023
£ £
Contracted for but not provided for:
Other 157,167 207,850

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases.