Company registration number 00337210 (England and Wales)
WATERFIELDS (LEIGH) LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 5 APRIL 2024
WATERFIELDS (LEIGH) LIMITED
COMPANY INFORMATION
Directors
M.I. Brehme
(Appointed 10 January 2025)
S.E. Davies
(Appointed 10 January 2025)
Company number
00337210
Registered office
Crompton Fold Bakery
Manchester Road
Leigh
Lancashire
WN7 2LX
Auditor
JS. Audit Limited
James House
Stonecross Business Park
Yew Tree Way
Warrington
Cheshire
WA3 3JD
Business address
Crompton Fold Bakery
Manchester Road
Leigh
Lancashire
WN7 2LX
Bankers
Santander UK plc
Bridle Road
Bootle
Merseyside
L30 4GB
Solicitors
Dootsons LLP
61-63 Church Street
Leigh
WN7 1QH
WATERFIELDS (LEIGH) LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Independent auditor's report
4 - 6
Statement of income and retained earnings
7
Balance sheet
8
Statement of cash flows
9
Notes to the financial statements
10 - 21
WATERFIELDS (LEIGH) LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 5 APRIL 2024
- 1 -
The directors present the strategic report for the year ended 5 April 2024.
Fair review of the business
The loss before taxation for the year was £259k which the directors are satisfied with given the difficult economic conditions faced during the year.
Turnover for the year increased by £1.9M to £15.5M. Both retail and wholesale sales continue to grow strongly.
Gross profit increased slightly from 46.6% to 46.8%.
Wage costs suffered inflationary pressure, with the national minimum wage increasing by 9.7% in April 2023, and a tight labour market contributing to inflationary expectations throughout the workforce.
Energy and vehicle fuel costs have also increased in line with global trends, with significant increases where long-term contracts have expired, but the company has maintained tight control over its other overhead costs.
The company has continued to monitor its key performance indicators. Turnover is monitored by shop, as are footfall and average spend to identify any performance issues. Wholesale turnover and contribution are also reviewed by customer.
Funding
Capital investment during the year has been significant, mainly on plant and equipment and has been funded out of working capital.
The company’s balance sheet position remains healthy as a result of the prudent management of resources. The company has a comfortable cash in hand balance and has again operated throughout the year without an overdraft.
Principal risks and opportunities
Turnover has returned to pre-pandemic levels and the company is now looking to develop other opportunities to increase turnover in the future.
Increasing wage and energy costs remain a challenge.
Future developments
Future capital expenditure will be focussed on developing opportunities to generate additional revenue.
M.I. Brehme
Director
26 March 2025
WATERFIELDS (LEIGH) LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 5 APRIL 2024
- 2 -
The directors present their annual report and financial statements for the year ended 5 April 2024.
Principal activities
The principal activity of the company continued to be that of manufacturers and retailers of bakery products.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
A.R. Waterfield (Resigned 10 January 2025)
C. Harris (Resigned 10 January 2025
M.I Brehme (Appointed 10 January 2025)
S.E. Davies (Appointed 10 January 2025)
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.
Disabled persons
The company's policy is to provide training and career development facilities for disabled persons on the same basis as for the other staff and to make every effort to retain and assist any individuals disabled in the course of their employment.
Employee involvement
Regular communication with employees is recognised as a management responsibility and the directors keep the employees informed of developments by issuing regular company magazines and Product News Bulletins and by holding regular staff meetings.
Auditor
The auditor, JS. Audit Limited, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
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
WATERFIELDS (LEIGH) LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 5 APRIL 2024
- 3 -
Strategic report
The company has chosen in accordance with Companies Act 2006, s.414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report.
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.
On behalf of the board
M.I. Brehme
Director
26 March 2025
WATERFIELDS (LEIGH) LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF WATERFIELDS (LEIGH) LIMITED
- 4 -
Opinion
We have audited the financial statements of Waterfields (Leigh) Limited (the 'company') for the year ended 5 April 2024 which comprise the statement of income and retained earnings, the balance sheet, the statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
give a true and fair view of the state of the company's affairs as at 5 April 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.
WATERFIELDS (LEIGH) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF WATERFIELDS (LEIGH) LIMITED
- 5 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement included within the directors' report, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Irregularities and 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.
Based on our understanding of the company and sector, we identified that the principal risks of non-compliance with laws and regulations related to, but was not limited to, the Companies Act 2006, UK tax, employment, pension and health and safety legislation and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006.
We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls) and determined that the principal risks were completeness of income as well as those related to management bias in accounting estimates and judgements and the risk of fraud in revenue recognition.
WATERFIELDS (LEIGH) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF WATERFIELDS (LEIGH) LIMITED
- 6 -
Our procedures to respond to risks identified included the following:
reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements;
enquiring of management about actual and potential litigation and claims, their policies and procedures to prevent and detect fraud as well as whether they have knowledge of any actual, suspected or alleged fraud;
performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;
reading minutes of meetings of those charged with governance;
reviewing accounting estimates, judgements and decisions made by management, in particular in respect of the useful economic lives for tangible assets, including reviewing profit and losses on disposals as an indicator of appropriateness of useful economic lives, stock provisions and bad debt provisions;
obtaining an understanding of provisions and holding discussions with management to understand the basis of recognition or non-recognition of tax provisions; and
in addressing the risk of fraud through management override of controls: testing the appropriateness of journal entries; assessing whether the accounting estimates, judgements and decisions made by management are indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.
We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.
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 other management 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.
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.
Peter Atkinson F.C.A. (Senior Statutory Auditor)
For and on behalf of JS. Audit Limited
27 March 2025
Chartered Accountants
Statutory Auditor
James House
Stonecross Business Park
Yew Tree Way
Warrington
Cheshire
WA3 3JD
WATERFIELDS (LEIGH) LIMITED
STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE YEAR ENDED 5 APRIL 2024
- 7 -
2024
2023
Notes
£
£
Turnover
3
15,539,825
13,588,428
Cost of sales
(8,273,420)
(7,257,990)
Gross profit
7,266,405
6,330,438
Distribution costs
(6,573,983)
(5,416,559)
Administrative expenses
(940,704)
(859,819)
Operating (loss)/profit
4
(248,282)
54,060
Interest payable and similar expenses
8
(11,127)
(1,720)
(Loss)/profit before taxation
(259,409)
52,340
Tax on (loss)/profit
9
64,469
(14,556)
(Loss)/profit for the financial year
(194,940)
37,784
Retained earnings brought forward
1,766,601
1,728,817
Retained earnings carried forward
1,571,661
1,766,601
The statement of income and retained earnings has been prepared on the basis that all operations are continuing operations.
WATERFIELDS (LEIGH) LIMITED
BALANCE SHEET
AS AT
5 APRIL 2024
05 April 2024
- 8 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
11
1,496,702
1,468,629
Current assets
Stocks
12
403,475
392,605
Debtors
13
731,412
554,324
Cash at bank and in hand
317,728
617,454
1,452,615
1,564,383
Creditors: amounts falling due within one year
14
(1,030,154)
(854,891)
Net current assets
422,461
709,492
Total assets less current liabilities
1,919,163
2,178,121
Creditors: amounts falling due after more than one year
15
(113,373)
(112,922)
Provisions for liabilities
17
(178,487)
(242,956)
Net assets
1,627,303
1,822,243
Capital and reserves
Called up share capital
19
52,200
52,200
Capital redemption reserve
20
3,442
3,442
Profit and loss reserves
20
1,571,661
1,766,601
Total equity
1,627,303
1,822,243
The financial statements were approved by the board of directors and authorised for issue on 26 March 2025 and are signed on its behalf by:
M.I. Brehme
Director
Company Registration No. 00337210
WATERFIELDS (LEIGH) LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 5 APRIL 2024
- 9 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash (absorbed by)/generated from operations
24
(3,957)
280,963
Interest paid
(11,127)
(1,720)
Income taxes refunded
65,161
Net cash (outflow)/inflow from operating activities
(15,084)
344,404
Investing activities
Purchase of tangible fixed assets
(240,135)
(457,692)
Proceeds from disposal of tangible fixed assets
17,500
Net cash used in investing activities
(222,635)
(457,692)
Financing activities
Payment of finance leases obligations
(62,007)
(1,083)
Net cash used in financing activities
(62,007)
(1,083)
Net decrease in cash and cash equivalents
(299,726)
(114,371)
Cash and cash equivalents at beginning of year
617,454
731,825
Cash and cash equivalents at end of year
317,728
617,454
WATERFIELDS (LEIGH) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 5 APRIL 2024
- 10 -
1
Accounting policies
Company information
Waterfields (Leigh) Limited is a private company limited by shares incorporated in England and Wales. The registered office is Crompton Fold Bakery, Manchester Road, Leigh, Lancashire, WN7 2LX.
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 on the historical cost convention. The principal accounting policies adopted are set out below.
1.2
Going concern
Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
Turnover
Turnover represents amounts receivable for bakery products despatched or sold prior to the balance sheet date 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
Intangible fixed assets - goodwill
Goodwill represents the excess of the cost of acquisition of unincorporated businesses over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is written off in equal annual instalments over its estimated useful economic life of 10 years.
1.5
Tangible fixed assets
Tangible fixed assets are initially measured at cost net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost of assets less their residual values over their useful lives on the following bases:
Short leasehold buildings and improvements
2% per annum - straight line basis, or over the remaining life of the lease
Plant and machinery
5% to 20% per annum - straight line basis
Motor vehicles
12.5% to 20% per annum - straight line 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.
WATERFIELDS (LEIGH) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 5 APRIL 2024
1
Accounting policies
(Continued)
- 11 -
1.6
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
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.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
1.8
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.9
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
WATERFIELDS (LEIGH) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 5 APRIL 2024
1
Accounting policies
(Continued)
- 12 -
Impairment of financial assets
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities 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.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.10
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.11
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
WATERFIELDS (LEIGH) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 5 APRIL 2024
1
Accounting policies
(Continued)
- 13 -
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.12
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.13
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.14
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
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.
WATERFIELDS (LEIGH) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 5 APRIL 2024
- 14 -
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, if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods. The critical estimates made by the directors in preparing these financial statements relate to the judgement applied in determining the level of any stock provisions required to ensure that stock is valued at the lower of cost and net realisable value at the balance sheet date, which is set out in Note 1.7.
3
Turnover
An analysis of the company's turnover is as follows:
2024
2023
£
£
Turnover analysed by class of business
Manufacturing and retailing of bakery products
15,539,825
13,588,428
2024
2023
£
£
Turnover analysed by geographical market
United Kingdom
15,539,825
13,588,428
4
Operating (loss)/profit
2024
2023
Operating (loss)/profit for the year is stated after charging/(crediting):
£
£
Depreciation of owned tangible fixed assets
238,571
238,712
Depreciation of tangible fixed assets held under finance leases
21,285
2,696
Profit on disposal of tangible fixed assets
(4,780)
-
Operating lease charges
634,821
617,697
5
Auditor's remuneration
2024
2023
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
14,330
12,590
For other services
Taxation compliance services
1,775
1,750
All other non-audit services
1,795
2,710
3,570
4,460
WATERFIELDS (LEIGH) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 5 APRIL 2024
- 15 -
6
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2024
2023
Number
Number
Production
105
101
Distribution
22
19
Selling
230
242
Administration
18
20
Total
375
382
Their aggregate remuneration comprised:
2024
2023
£
£
Wages and salaries
6,675,569
5,715,127
Social security costs
481,602
407,889
Pension costs
149,593
126,676
7,306,764
6,249,692
7
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
136,863
121,306
Company pension contributions to defined contribution schemes
10,000
9,200
146,863
130,506
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 2 (2023 - 2).
8
Interest payable and similar expenses
2024
2023
£
£
Other finance costs:
Interest on finance leases and hire purchase contracts
9,468
293
Other interest
1,659
1,427
11,127
1,720
WATERFIELDS (LEIGH) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 5 APRIL 2024
- 16 -
9
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
(21,943)
Adjustments in respect of prior periods
21,887
Total current tax
(56)
Deferred tax
Origination and reversal of timing differences
(64,563)
14,612
Adjustment in respect of prior periods
94
Total deferred tax
(64,469)
14,612
Total tax (credit)/charge
(64,469)
14,556
The actual (credit)/charge for the year can be reconciled to the expected (credit)/charge for the year based on the profit or loss and the standard rate of tax as follows:
2024
2023
£
£
(Loss)/profit before taxation
(259,409)
52,340
Expected tax (credit)/charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 19.00%)
(64,852)
9,945
Tax effect of expenses that are not deductible in determining taxable profit
289
1,653
Adjustments in respect of prior years
-
21,887
Effect of change in corporation tax rate
3,507
Permanent capital allowances in excess of depreciation
(18,464)
Deferred tax adjustments in respect of prior years
94
Other
(3,972)
Taxation (credit)/charge for the year
(64,469)
14,556
WATERFIELDS (LEIGH) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 5 APRIL 2024
- 17 -
10
Intangible fixed assets
Goodwill
£
Cost
At 6 April 2023 and 5 April 2024
431,249
Amortisation and impairment
At 6 April 2023 and 5 April 2024
431,249
Carrying amount
At 5 April 2024
At 5 April 2023
11
Tangible fixed assets
Short leasehold buildings and improvements
Plant and machinery
Motor vehicles
Total
£
£
£
£
Cost
At 6 April 2023
950,164
7,177,561
650,357
8,778,082
Additions
287,174
13,475
300,649
Disposals
(126,188)
(85,151)
(211,339)
At 5 April 2024
950,164
7,338,547
578,681
8,867,392
Depreciation and impairment
At 6 April 2023
780,319
6,051,706
477,428
7,309,453
Depreciation charged in the year
26,750
189,849
43,257
259,856
Eliminated in respect of disposals
(123,574)
(75,045)
(198,619)
At 5 April 2024
807,069
6,117,981
445,640
7,370,690
Carrying amount
At 5 April 2024
143,095
1,220,566
133,041
1,496,702
At 5 April 2023
169,845
1,125,855
172,929
1,468,629
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
2024
2023
£
£
Plant and machinery
271,734
203,849
WATERFIELDS (LEIGH) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 5 APRIL 2024
- 18 -
12
Stocks
2024
2023
£
£
Raw materials and consumables
323,793
315,282
Finished goods and goods for resale
79,682
77,323
403,475
392,605
13
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
401,829
297,083
Corporation tax recoverable
21,943
21,943
Other debtors
110,090
46,536
Prepayments and accrued income
197,550
188,762
731,412
554,324
14
Creditors: amounts falling due within one year
2024
2023
Notes
£
£
Obligations under finance leases
16
56,051
57,995
Trade creditors
438,231
315,046
Taxation and social security
151,097
107,727
Other creditors
73,779
68,177
Accruals and deferred income
310,996
305,946
1,030,154
854,891
15
Creditors: amounts falling due after more than one year
2024
2023
Notes
£
£
Obligations under finance leases
16
113,373
112,922
16
Finance lease obligations
2024
2023
Future minimum lease payments due under finance leases:
£
£
Within one year
56,051
57,995
In two to five years
113,373
112,922
169,424
170,917
WATERFIELDS (LEIGH) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 5 APRIL 2024
16
Finance lease obligations
(Continued)
- 19 -
Finance lease payments represent rentals payable by the company for certain items of plant and machinery. Leases include purchase options at the end of the lease period and no restrictions are placed on the use of the assets. The average lease term is 4 years. All leases are on fixed repayment basis and no arrangements have been entered into for the contingent rental payments.
Finance lease obligations are secured on the assets to which they relate.
17
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
282,361
269,396
Tax losses
(99,868)
(23,553)
Retirement benefit obligations
(4,006)
(2,887)
178,487
242,956
2024
Movements in the year:
£
Liability at 6 April 2023
242,956
Credit to profit or loss
(64,469)
Liability at 5 April 2024
178,487
The deferred tax liability set out above is expected to reverse within 4 years and relates predominantly to accelerated capital allowances that are expected to mature within the same period.
18
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
149,593
126,676
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.
At the balance sheet date, outstanding contributions to the scheme amounted to £32,214 (2023: £23,432).
WATERFIELDS (LEIGH) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 5 APRIL 2024
- 20 -
19
Share capital
2024
2023
Ordinary share capital
£
£
Issued and fully paid
52,200 Ordinary Shares of £1 each
52,200
52,200
20
Profit and loss reserves
Capital redemption reserve
Represents the nominal value of shares repurchased by the company.
Profit and loss reserves
Represents cumulative profits and losses net of distributions to shareholders.
21
Operating lease commitments
Lessee
Operating lease payments predominantly represent rentals payable by the company for certain of its properties. Leases are negotiated for an average term of between 5 and 10 years with break clauses negotiated as appropriate on a property by property basis.
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2024
2023
£
£
Within one year
559,436
516,488
Between two and five years
1,636,531
1,677,972
In over five years
543,025
736,261
2,738,992
2,930,721
22
Related party transactions
Remuneration of key management personnel
The remuneration of key management personnel, including directors, is as follows.
2024
2023
£
£
Aggregate compensation
146,863
144,639
Other information
During the year the company paid rent on various properties owned or leased by the Waterfields (Leigh) Self Administered Pension Fund. The rent charged amounted to £239,212 (2023: £239,348) for the year. The amount due at the balance sheet date to the pension scheme was £40,101 (2023: £39,698).
23
Ultimate controlling party
The ultimate controlling party during the year was A R Waterfield.
WATERFIELDS (LEIGH) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 5 APRIL 2024
- 21 -
24
Cash (absorbed by)/generated from operations
2024
2023
£
£
(Loss)/profit after taxation
(194,940)
37,784
Adjustments for:
Taxation (credited)/charged
(64,469)
14,556
Finance costs
11,127
1,720
Gain on disposal of tangible fixed assets
(4,780)
-
Depreciation and impairment of tangible fixed assets
259,856
241,408
Movements in working capital:
Increase in stocks
(10,870)
(81,045)
(Increase)/decrease in debtors
(177,088)
61,835
Increase in creditors
177,207
4,705
Cash (absorbed by)/generated from operations
(3,957)
280,963
25
Analysis of changes in net funds
6 April 2023
Cash flows
New finance leases
5 April 2024
£
£
£
£
Cash at bank and in hand
617,454
(299,726)
-
317,728
Obligations under finance leases
(170,917)
62,007
(60,514)
(169,424)
446,537
(237,719)
(60,514)
148,304
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