Registration number: 14742412
Abridged Financial Statements
Alo Europe Limited
For the period from 20 March 2023 to 30 December 2023
Alo Europe Limited
Contents
Page
Company Information
Directors' Report
Independent Auditor's Report
Statement of Financial Position
Statement of Changes in Equity
Notes to the Abridged Financial Statements
1
2 - 3
4 - 8
9 - 10
11
12 - 22
Alo Europe Limited
Company Information
Directors
Marco DeGeorge
Daniel Harris
Registered number
14742412
Registered office
12 New Fetter Lane
London
United Kingdom EC4A 1JP
Solicitors
Bird & Bird LLP
12 New Fetter Lane London
United Kingdom EC4A 1JP
Bankers
HSBC UK Bank Plc
1 Centenary Square
Birmingham
B1 1HQ
Auditors
MSD Accountants Limited
Unit A6, Santry Business Park
Swords Road, Dublin 9 Ireland
D09X651
Page 1
Alo Europe Limited
Directors' Report
For the period from 20 March 2023 to 30 December 2023
The directors present their annual report and the financial statements for the period from the date of incorporation 20 March 2023 to 30 December 2023. This is the first set of financial statement presented, and is for a 10-month period.
Principal activities
Alo Europe Limited is a private company limited by share capital, incorporated in the United Kingdom, with its registered office at 12 New Fetter Lane, London, EC4A 1JP, United Kingdom, and with a registered number of 14742412.
The Company's principal business is to operate retail clothing stores in the United Kingdom.
Directors of the company
The directors of the Company who held office during the period, and up to the date of signing of the financial statements were as follows:
Marco DeGeorge
Daniel Harris
Results and dividends
The results of the Company for the period are set out in the Statement of Comprehensive Income and its related notes. The loss for the financial period after taxation, amounted to £347,092.
The directors do not recommend the payment of a dividend in the current period.
Going concern
On 30 December 2023, the Company is in a net current liability of £1,331,511 and net asset position of
£817,103. The Company's forecasts and projections, taking account of reasonably possible changes in trading performance, show that the Company should be able to operate within the level of its current borrowings.
After making enquiries, the directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. The Company therefore continues to adopt the going concern basis in preparing its financial statements.
Page 2
Alo Europe Limited
Directors' Report
For the period from 20 March 2023 to 30 December 2023 (continued)
Statement of directors responsibilities
The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulation. Company law requires the directors to prepare financial statements for each financial period. Under that law the directors have prepared the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards, comprising FRS 102 Section 1A, 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 the financial statements, the directors are required to:
•
select suitable accounting policies and then apply them consistently;
•
state whether applicable United Kingdom Accounting Standards, comprising FRS 102, have been followed, subject to any material departures disclosed and explained in the financial statements;
•
make judgments and accounting estimates that are reasonable and prudent; and
•
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 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. 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.
Post balance sheet events
There are no significant events affecting the Company since period end, that require adjustment to, or disclosure in the financial statements.
Small companies provision statement
In preparing this report, the directors have taken advantage of the small companies exemptions provided by the Companies Act 2006.
Approved by the Board on
20 March 2025
20 March 2025
and signed on its behalf by:
.........................................
.........................................
Marco DeGeorge Director
Daniel Harris Director
Page 3
Alo Europe Limited
Independent Auditor's Report to the Members of Alo
Europe Limited
Qualified Opinion
We have audited the financial statements of Alo Europe Limited (the 'Company') for the period ended 30 December 2023, which comprise the Statement of Comprehensive Income, the Statement of Financial Position, the Statement of Changes in Equity and notes to the financial statements, 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 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, except for the effects of the matter described in the basis for qualified opinion section of the report, the financial statements:
•
give a true and fair view of the assets, liabilities and financial position of the Company as at 30 December 2023 and of its loss for the period then ended;
•
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
•
have been properly prepared in accordance with the requirements of the Companies Act 2006.
Basis for qualified opinion
We were unable to attend the period-end inventory count as we were not appointed as auditors to the company until November 2024. We were unable to satisfy ourselves by alternative means, concerning the inventory quantities at 30 December 2023, which are included in the Statement of Financial position at
£186,508, by using other procedures. Consequently, we were unable to determine whether any adjustment to this amount was necessary.
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
We are responsible for concluding 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 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 report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify the auditor's opinion. Our conclusions are based on the audit evidence obtained up to the date of our report. However, future events or conditions may cause the Company to cease to continue as a going concern.
Page 4
Alo Europe Limited
Independent Auditor's Report to the Members of Alo Europe Limited (continued)
Conclusions relating to going concern (continued)
In our evaluation of the directors' conclusions, we considered the inherent risks associated with the Company's business model including effects arising from macro-economic uncertainties such as the cost of living crisis, we assessed and challenged the reasonableness of estimates made by the directors and the related disclosures and analysed how those risks might affect the Company's financial resources or ability to continue operations over the going concern period.
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.
Other information
The other information comprises the information included in the financial statements, other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the financial statements. 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 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 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 the audit:
•
the information given in the Directors' Report for the financial period for which the financial statements are prepared is consistent with the financial statements; and
•
the Directors' Report has been prepared in accordance with applicable legal requirements.
Matter on which we are required to report under the Companies Act 2006
In the light of the knowledge and understanding of the Company and their environment obtained in the course of the audit, we have not identified material misstatements in the directors' report.
Page 5
Alo Europe Limited
Independent Auditor's Report to the Members of Alo Europe Limited (continued)
Matters on which we are required to report by exception
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 by the Company, or returns adequate for our audit have not been received from branches not visited by us; or
•
the Company financial statements are not in agreement with the accounting records and returns; or
•
certain disclosures of directors' remuneration specified by law are not made; or
•
we have not received all the information and explanation we require for our audit;
•
the directors were not entitled to prepare the financial statements in accordance with the small companies regimes and take advantage of the small companies' exemptions in preparing the directors' report and the requirements to prepare a strategic report.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement set out in page 3, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
•
The Company is subject to many laws and regulations where the consequences of non-compliance could have a material effect on amounts or disclosures in the financial statements. We identified the laws and regulations that are most likely to have a material effect if noncompliance were to occur; financial reporting legislation, tax legislation, anti-bribery legislation and as well as employment law.
•
We communicated relevant 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;
Page 6
Alo Europe Limited
Independent Auditor's Report to the Members of Alo Europe Limited (continued)
•
We understood how the Company is complying with those legal and regulatory frameworks by making enquiries of management. We corroborated our enquires through our review of minutes and certain other procedures;
•
Based on the results of our risk assessment we designed audit procedures to identify non-compliance with such laws and regulations identified above. Our procedures involved journal entry testing, with a focus on journals meeting our defined risk criteria based on our understanding of the business; and enquiries of Company management.
•
These audit procedures were designed to provide reasonable assurance that the financial statements were free from fraud or error. The risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error and detecting irregularities that result from fraud is inherently more difficult than detecting those that result from error, as fraud may involve collusion, deliberate concealment, forgery or intentional misrepresentations. Also, the further removed non-compliance with laws and regulations is from events and transactions reflected in the financial statements, the less likely we would become aware of it;
•
Assessment of the appropriateness of the collective competence and capabilities of the engagement team included consideration of the engagement team's:
–
understanding of, and practical experience with audit engagements of a similar nature and complexity through appropriate training and participation
–
knowledge of the industry in which the client operates – understanding of the legal and regulatory requirements specific to the entity including the provisions of the applicable legislation, regulators rules and related guidance, including guidance issued by relevant authorities that interpret those rules and the applicable statutory provisions.
•
In assessing the potential risks of material misstatement, we obtained an understanding of:
–
the Company's operations, including the nature of their revenue sources, products and services and of its objectives and strategies to understand the classes of transactions, account balances, expected financial statement disclosures and business risks that may result in risks of material misstatement;
–
the applicable statutory provisions;
–
the Company's control environment, including the policies and procedures implemented to comply with the requirements of its regulator, including the adequacy of the training to inform staff of the relevant legislation, rules and other regulations of the regulator, the adequacy of procedures for authorisation of transactions, internal review procedures over the entity's compliance with regulatory requirements, the authority of, and resources available and procedures to ensure that possible breaches of requirements are appropriately investigated and reported.
A further description of our responsibilities for the audit of the financial statement is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditor's report.
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.
Page 7
Alo Europe Limited
Independent Auditor's Report to the Members of Alo Europe Limited (continued)
Brendan Murtagh
(Senior Statutory Auditor)
For and on behalf of
MSD Accountants Limited,
Chartered certified Accountants and Statutory Audit Firm Unit A6, Santry Business Park
Swords Road, Dublin 9 Ireland
D09X651
25 March 2025
Page 8
Alo Europe Limited
Statement of Financial Position
As at
30 December 2023
2023-12-30
Registration number: 14742412
30 December
2023
Note
£
Fixed assets
4
1,817,431
Tangible assets
5
345,000
Other financial assets
2,162,431
Current assets
6
186,508
Inventories
7
1,386,787
Debtors: amounts falling due within one year
8
1,297,851
Cash at bank and in hand
2,871,146
9
(4,202,657)
Creditors: amount falling due within one year
(1,331,511)
Net current liabilities
830,920
Total assets less current liabilities
Provision for liabilities
10
(13,817)
Deferred tax liabilities
817,103
Net assets
Capital and reserves
12
100
Called up share capital
1,164,095
Share premium
(347,092)
Profit and loss account
817,103
Total equity
The financial statements have been prepared in accordance with the special provisions relating to companies subject to the small companies regime within Part 15 of the Companies Act 2006 and in accordance with the provisions of FRS102 Section 1A - Small Entities.
The company has presented an abridged balance sheet as permitted by Section 1A of Schedule 1 to the Small Companies and Groups (Accounts and Directors' Report) Regulations; all the members have consented to the abridgement option. The company has taken advantage of the provisions contained within s444 (1) of the Companies Act 2006 from filing their Statement of Comprehensive income.
The notes on pages 12 to 22 form an integral part of these financial statements.
Page 9
Alo Europe Limited
Statement of Financial Position
As at 30 December 2023 (continued)
Registration number: 14742412
Approved and authorised by the Board on
20 March 2025
20 March 2025
and signed on its behalf by:
.........................................
.........................................
Marco DeGeorge Director
Daniel Harris Director
The notes on pages 12 to 22 form an integral part of these financial statements.
Page 10
Alo Europe Limited
Statement of Changes in Equity
For the period from 20 March 2023 to 30 December 2023
Share premium
Profit and loss
Share capital
account
Total
£
£
£
£
At 20 March 2023
Loss and total comprehensive loss for the period
-
-
(347,092)
(347,092)
100
-
-
100
Ordinary shares issued
-
1,164,095
-
1,164,095
Additional paid-in capital
100
1,164,095
(347,092)
817,103
At 30 December 2023
The notes on pages 12 to 22 form an integral part of these financial statements.
Page 11
Alo Europe Limited
Notes to the Abridged Financial Statements
For the period from 20 March 2023 to 30 December 2023
1
General information
Alo Europe Limited is a private company limited by share capital, incorporated in United Kingdom and registered in England and Wales. The address of its registered office is 12 New Fetter Lane, London , EC4A 1JP, United Kingdom.
These financial statements are presented in Pounds Sterling (£) because that is the currency of the primary economic environment in which the Company operates. The nature of the Company's operations and its principal activities are set out in the Directors' report.
2
Accounting policies
The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to the period presented, unless otherwise stated.
2.1
Basis of preparation of financial statements
These financial statements have been prepared in accordance with Section 1A of Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" including the provisions of Section 1A "Small Entities" and the Companies Act 2006.
The financial statements have been prepared under the historical cost convention, on the going concern basis and in accordance with the Companies Act 2006.
The following principal accounting policies have been applied:
2.2
Financial reporting standard 102 - reduced disclosure exemptions
The Company has taken advantage of exemptions from the following disclosure requirements in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
•
the requirements of Section 7 Statement of Cash Flows;
•
the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
•
the requirements of Section 33 Related Party Disclosures paragraph 33.7.
Page 12
Alo Europe Limited
Notes to the Abridged Financial Statements
For the period from 20 March 2023 to 30 December 2023 (continued)
2 Accounting policies (continued)
2.3
New standards, amendments and new relevant disclosure
The amendments to FRS102 have been introduced in response to the OECD's BEPS Pillar Two rules and include:
•
A mandatory temporary exception to the recognition and disclosure of deferred taxes arising from the jurisdictional implementation of the Pillar Two model rules; and
•
Disclosure requirements for affected entities to help users of the financial statements better understand an entity's exposure to Pillar Two income taxes arising from that legislation, particularly before its effective date.
The mandatory temporary exception - the use which is required to be disclosed - applies immediately. The remaining disclosure requirements apply for annual reporting periods beginning on or after 1 January 2023, but not for any interim period ending on or before 30 December 2023.
International Tax Reform - Pillar Two Model Rules
The Company is likely to be within the scope of the OECD's Pillar Two tax rules, although consultations are still in progress at this point. Pillar Two legislation has been substantively enacted in the United Kingdom at 30 December 2023. The legislation will be effective for the Company's financial year beginning 31 December 2023. The Company is still in the process of assessing the potential exposure to Pillar Two income taxes for the year ending 30 December 2024. The potential exposure, if any, to Pillar Two income taxes is currently not known or reasonably estimable. The Company will report the potential exposure in its next annual financial statements for the year ending 30 December 2024.
The Company has applied the mandatory temporary exception to accounting for deferred taxes arising from implementation of Pillar Two model rules introduced in the amendment to FRS 102 adopted by the FRC in July 2023.
Page 13
Alo Europe Limited
Notes to the Abridged Financial Statements
For the period from 20 March 2023 to 30 December 2023 (continued)
2
Accounting policies (continued)
2.3
New standards, amendments and new relevant disclosure (continued)
Amendments to FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland and other FRSs Periodic Review 2024
On 27 March 2024, the FRC issued Amendments to FRS 102. The effective date for most amendments is accounting periods beginning on or after 1 January 2026, with earlier adoption permitted. The Amendments include new disclosures for supplier finance arrangements that are mandatorily effective from 1 January 2025 but management has chosen to adopt these in the 2025 financial statements.
The most significant amendments are the replacement of Section 23, now renamed Revenue from Contracts with Customers, and Section 20 Leases. The many other less significant changes, including a new Section 2A Fair Value Measurement, are not currently expected to have a material impact. The new revenue and leasing requirements seek to provide greater consistency and alignment to the international accounting standards, i.e., IFRS 15 and IFRS 16. The Company is planning for the implementation of these change and is at an early stage in evaluating their financial impact. At 31 December 2023 the Company had commitments under operating leases of approximately £5,270,833 (gross) (see note 11).
Under the new lease accounting requirements management expects that these amounts would be recognised on-balance sheet, with a lease liability based on the discounted value of the future commitments, plus payments related to optional extension periods if considered reasonably certain, and a related ‘right-of-use' asset. Management is reviewing existing revenue contracts to determine the overall recognition, measurement, presentation and disclosure impact.
There are no other amendments to accounting standards that are effective for the year ended 30 December 2023 that have a material impact on the company's financial statements.
2.4
Going concern
On 30 December 2023, the Company is in a net current liability of £1,331,511 and net asset position of
£817,103. The Company's forecasts and projections, taking account of reasonably possible changes in trading performance, show that the Company should be able to operate within the level of its current borrowings.
After making enquiries, the directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. The Company therefore continues to adopt the going concern basis in preparing its financial statements.
Page 14
Alo Europe Limited
Notes to the Abridged Financial Statements
For the period from 20 March 2023 to 30 December 2023 (continued)
2 Accounting policies (continued)
2.5
Turnover
Turnover is measured at the fair value of the consideration received or receivable, net of discounts and value added taxes. Turnover includes revenue earned from the sale of goods and from the rendering of services.
Sale of goods
Revenue from the sale of goods is recognised when all of the following conditions are satisfied:
•
the Company has transferred the significant risks and rewards of ownership to the buyer;
•
the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
•
the amount of revenue can be measured reliably;
•
it is probable that the Company will receive the consideration due under the transaction; and
•
the costs incurred or to be incurred in respect of the transaction can be measured reliably.
Rendering of services
Turnover from the rendering of services is recognised by reference to the stage of completion of the contract. The stage of completion of a contract is measured by comparing the costs incurred for work performed to date to the total estimated contract costs. Turnover is only recognised to the extent of recoverable expenses when the outcome of a contract cannot be estimated reliably.
2.6
Taxation
Current tax is recognised for the amount of income tax payable in respect of the taxable profit for the current or past reporting periods using the tax rates and laws that that have been enacted or substantively enacted by the reporting date.
Deferred tax is recognised in respect of all timing differences at the reporting date, except as otherwise indicated.
Deferred tax assets are only 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.
If and when all conditions for retaining tax allowances for the cost of a fixed asset have been met, the deferred tax is reversed.
Page 15
Alo Europe Limited
Notes to the Abridged Financial Statements
For the period from 20 March 2023 to 30 December 2023 (continued)
2
Accounting policies (continued)
2.6
Taxation (continued)
A deferred tax liability or asset is recognised for the additional tax that will be paid or avoided in respect of assets and liabilities that are recognised in a business combination. The amount attributed to goodwill is adjusted by the amount of deferred tax recognised.
Deferred tax is calculated using the tax rates and laws that that have been enacted or substantively enacted by the reporting date that are expected to apply to the reversal of the timing difference.
With the exception of changes arising on the initial recognition of a business combination, the tax expense (income) is presented either in profit or loss, other comprehensive income or equity depending on the transaction that resulted in the tax expense (income).
Deferred tax liabilities are presented within provisions for liabilities and deferred tax assets within debtors. Deferred tax assets and deferred tax liabilities are offset only if:
•
the company has a legally enforceable right to set off current tax assets against current tax liabilities, and
•
the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities which intend either to settle current tax liabilities and assets on a net basis, or to realise the assets and settle the liabilities simultaneously.
2.7
Employee benefits
Short-term employee benefits are recognised as an expense in the period in which they are incurred.
The cost of any unused holiday entitlement is recognised in the period in which the employees' services are received.
Termination benefits are expensed when the Company can no longer withdraw the offer of those benefits. If benefits are not expected to be settled wholly within 12 months of the reporting date, then they are discounted.
Page 16
Alo Europe Limited
Notes to the Abridged Financial Statements
For the period from 20 March 2023 to 30 December 2023 (continued)
2 Accounting policies (continued)
2.8
Tangible assets
Tangible fixed assets are measured at cost less accumulated depreciation and any accumulated impairment losses. Cost includes the original purchase price of the asset and the costs attributable to bringing the asset to its working condition for its intended use.
Depreciation is calculated to write down the cost less estimated residual value of all tangible fixed assets, other than freehold land, over their expected useful lives, using the straight-line method. The applicable useful lives are as follows:
Asset class
Useful lives
Furniture, fittings and equipment
5 years
Buildings
30 years
Construction in progress assets are not depreciated. Once such assets are brought into use, such assets are transferred into the appropriate asset class and depreciated over its expected useful economic life.
Cash at bank and in hand
2.9
Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.
Trade and other debtors
2.10
Trade debtors are amounts due from customers for merchandise sold or services performed in the ordinary course of business. If collection is expected in one year or less (or in the normal operating cycle of the business, if longer), they are classified as current assets. If not, they are presented as non-current assets.
Trade debtors are measured at transaction price, less any impairment. A provision for the impairment of trade debtors is established when there is objective evidence that the company will not be able to collect all amounts due according to the original terms of the receivables.
2.11
Inventories
The cost of finished goods comprises the purchase cost and those overheads that have been incurred in bringing the inventories to their present location and condition. At each reporting date, stocks are assessed for impairment. If stocks are impaired, the carrying amount is reduced to its selling price less costs to complete and sell; the impairment loss is recognised immediately in profit or loss.
Page 17
Alo Europe Limited
Notes to the Abridged Financial Statements
For the period from 20 March 2023 to 30 December 2023 (continued)
2 Accounting policies (continued)
2.12
Creditors
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Payables are classified as current liabilities if the company does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.
Trade creditors are recognised initially at the transaction price and subsequently measured at amortised cost using the effective interest method.
2.13
Provision for liabilities
Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable, and a reliable estimate can be made. Provisions are measured as the best estimate of the amount required to settle the obligation, considering the related risks and uncertainties, and the related increases are generally charged as an expense to profit or loss.
Provisions relating to the estimated cost of removing leasehold improvements are included as part of the cost of the asset.
Returns provisions are determined by estimating the expected level of returns, relying on historical return experience.
2.14
Foreign currency transactions and balances
Transactions in foreign currencies are initially recorded at the functional currency rate prevailing at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated into the respective functional currency of the entity at the rates prevailing on the reporting period date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing on the initial transaction dates.
Non-monetary items measured in terms of historical cost in a foreign currency are not retranslated.
2.15
Share capital
Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.
Page 18
Alo Europe Limited
Notes to the Abridged Financial Statements
For the period from 20 March 2023 to 30 December 2023 (continued)
2 Accounting policies (continued)
2.16
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership of the leased asset to the company. All other leases are classified as operating leases.
Assets held under finance leases are recognised initially at the fair value of the leased asset (or, if lower, the present value of minimum lease payments) at the inception of the lease. The corresponding liability to the lessor is included in the statement of financial position as a finance lease obligation. Lease payments are apportioned between finance charges and reduction of the lease obligation using the effective interest method so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are deducted in measuring profit or loss. Assets held under finance leases are included in tangible fixed assets and depreciated and assessed for impairment losses in the same way as owned assets.
3
Staff
The average number of persons employed by the Company (including directors) during the period, analysed by category was as follows:
2023
No.
Administration and support
2
Retail
24
Site management
3
29
Directors' remuneration
All directors' remuneration of the Group are paid by the Parent Company. There were no directors' remuneration paid by the Company during the period.
Page 19
Alo Europe Limited
Notes to the Abridged Financial Statements
For the period from 20 March 2023 to 30 December 2023 (continued)
4 Property, plant and equipment
Furniture, fittings and
Land and
Construction
buildings
equipment
in progress
Total
£
£
£
£
Cost
At 20 March 2023
1,225,401
277,954
328,693
1,832,048
Additions
1,225,401
277,954
328,693
1,832,048
At 30 December 2023
Depreciation
At 20 March 2023
9,983
4,634
14,617
Charge for the period
9,983
4,634
14,617
At 30 December 2023
Carrying amount
1,215,418
273,320
328,693
1,817,431
At 30 December 2023
5 Other financial assets
2023
£
345,000
Security deposits
345,000
6 Inventories
2023
£
186,508
Finished goods
Page 20
Alo Europe Limited
Notes to the Abridged Financial Statements
For the period from 20 March 2023 to 30 December 2023 (continued)
7 Debtors: amounts falling due within one year
2023
£
3,427
Trade debtors
30,408
VAT receivable
2,952
Prepayments
1,350,000
Other receivables
1,386,787
8 Cash at bank and in hand
2023
£
1,297,851
Cash at bank
9 Creditors: amounts falling due within one year
2023
£
732,590
Trade creditors
2,097,695
Amounts owed to group undertakings
1,372,372
Accrued expenses
4,202,657
10 Deferred Tax liabilities
2023
£
At beginning of period
13,817
Deferred tax - realised in current period
13,817
At 31 December
Page 21
Alo Europe Limited
Notes to the Abridged Financial Statements
For the period from 20 March 2023 to 30 December 2023 (continued)
Leasing commitments
11
The company's future minimum operating lease payments are as follows:
2023
£
-Within one year
383,333
-Later than one year and not later than five years
2,300,000
-Later than five years
2,587,500
5,270,833
12
Called up share capital
Allotted, called up and fully paid shares
2023
£
No.
Ordinary shares of £1 each
100
100
13
Post balance sheet events
There are no significant events affecting the Company since period end, that require adjustment to, or disclosure in the financial statements.
14
Parent and ultimate parent undertaking
The Company's immediate parent undertaking is Alo Holdings, a company incorporated in the United States, whose registered address is 9830 Wilshire Boulevard, Beverly Hills, CA, United States, 90212.
Color Image Apparel Inc., incorporated in the United States and registered at 9830 Wilshire Boulevard, Beverly Hills, CA, United States, 90212, is the ultimate parent undertaking.
Page 22
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