Registered number:
FOR THE YEAR ENDED 31 MARCH 2024
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ESKANDAR LIMITED
COMPANY INFORMATION
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ESKANDAR LIMITED
CONTENTS
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ESKANDAR LIMITED
GROUP STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2024
The director presents the Strategic report and the financial statements for Eskandar Limited (the "Company") and its subsidiaries (collectively, the "Group") for the year ended 31 March 2024. The principal activity of the Group is the retailing of luxury clothing and accessories.
The Group’s largest sales channel continued to be its own retail outlets, in London (Chelsea & Mayfair), Paris, New York, Chicago and Los Angeles followed by wholesale, notably Neiman Marcus and Bergdorf Goodman in the United States, and its concessions in Harrods and Liberty. In October, a fourth sales channel was added; an Eskandar online store.
The Group’s key performance indicators are those that reflect the Group's growth and profitability. The Group's key performance indicators are as follows: 2024 2023 Turnover £10,107,488 £11,428,110 Gross profit margin 71% 71% Loss (profit) before tax (£441,486) £905,585 The 10% drop in sales reflected challenging market conditions. Our key wholesale accounts scaled back their vendor purchases in general and other customers were lost. Our concession sales in Harrods were adversely affected by refurbishment works that resulted in our store being moved into a smaller temporary space. Retail sales were dragged down by the US based stores. The London stores and stand in Harrods continue to be adversely impacted by the removal of tax-free shopping for overseas tourists. Paris' key trading month of July was decimated by the Olympics. In October 2023, we launched our first online store, which despite its limited stock offer, generated sales ahead of expectations. Following the launch of Eskandar online stores during the year, post the balance sheet date, online sales growth continued and is now our largest sales generator. The Los Angeles store closed in October 2024 as the proposed rent increase and downward sales trend made the store unviable. Despite one-off exit costs from closing the Los Angeles store, we expect the business to return to profitability in 2025 because of online sales. In March 2025, properties held in Eskandar US Corporation LLC were sold for $2.28m, and the net proceeds after fees and taxes were used to repay much of its loan from Eskandar Limited.
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ESKANDAR LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
Financial and non-financial
Given our customer demographic, we were particularly adversely affected by the pandemic with some of our stores still trading below their pre-pandemic levels. This slower recovery combined with the above noted, largely one-off, factors that reduced retail sales as well as wholesale customers reducing their orders or closing, did impact the liquidity of the business. As a result, we had to borrow to fund the seasonal buy and cover our trading loss. However, the working capital position of the business has been markedly improved by the cash injection from the above noted property sale. This will help offset the likely reduction in credit terms from some of our suppliers. Cash generation and cash flow management continues to be a key focus as there can be a considerable time lag between paying our suppliers and being paid by our customers. Inflation continues to be a risk and we continue to work with our suppliers to reduce the impact of rising raw material and labour costs. The fact that our gross margin is over 70% is testament to our ongoing focus on this area. Inflation continues to be a significant risk and we continue to work with our suppliers to reduce the impact of rising raw material and labour costs. The fact that our gross margin is above 70% is testament to our ongoing focus in this area. The imposition of higher US tariffs would likely mean we would have to increase our US retail and wholesale prices to maintain our gross margin. There is a risk that higher prices could dampen demand and result in lower sales. With a significant proportion of our sales received in USD, and a high proportion of our purchases denominated in EUR, fluctuations in exchange rates impact the profitability of the business. As a result, we use hedging contracts to reduce the risk of currency fluctuations.
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ESKANDAR LIMITED
GROUP STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
This report was approved by the board and signed on its behalf.
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ESKANDAR LIMITED
DIRECTOR'S REPORT
FOR THE YEAR ENDED 31 MARCH 2024
The director presents his report and the financial statements for the year ended 31 March 2024.
The director is responsible for preparing the Group Strategic Report, the Director's Report and the consolidated financial statements in accordance with applicable law and regulations.
In preparing these financial statements, the director is required to:
∙select suitable accounting policies for the Group's financial statements and then apply them consistently;
∙make judgments 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 Group will continue in business.
The director is 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 the Group and to enable him to ensure that the financial statements comply with the Companies Act 2006. He is also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The loss for the year, after taxation and minority interests, amounted to £628,849 (2023 - profit £636,149).
During the year, the Company paid dividends of £327,404 (2023: £604,028).
The director who served during the year was:
The Group will continue to pursue organic growth through wholesale and retail opportunities.
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ESKANDAR LIMITED
DIRECTOR'S REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
These have been detailed in the Group Strategic Report.
This report was approved by the board and signed on its behalf.
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ESKANDAR LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF ESKANDAR LIMITED
We have audited the financial statements of Eskandar Limited (the 'parent Company') and its subsidiaries (the 'Group') for the year ended 31 March 2024, which comprise the Consolidated Statement of Comprehensive Income, the Consolidated Balance Sheet, the Company Balance Sheet, the Consolidated Statement of Cash Flows, the Consolidated Statement of Changes in Equity, the Company Statement of Changes in Equity and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
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 Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council'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.
In auditing the financial statements, we have concluded that the director's 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 Group's or the parent Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the director with respect to going concern are described in the relevant sections of this report.
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ESKANDAR LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF ESKANDAR LIMITED (CONTINUED)
The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' Report thereon. The director is 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.
In our opinion, based on the work undertaken in the course of the audit:
∙the information given in the Group Strategic Report and the Director's Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
∙the Group Strategic Report and the Director's Report have been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Director's Report.
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ESKANDAR LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF ESKANDAR LIMITED (CONTINUED)
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 Auditors' 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 Group financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
Enquiry of management and those charged with governance around actual and potential litigation and claims.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' 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 Auditors' 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.
for and on behalf of MHA, Statutory Auditors
London, United Kingdom
MHA is the trading name of MHA Audit Services LLP, a limited liability partnership in England and Wales (registered number OC455542).
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ESKANDAR LIMITED
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2024
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ESKANDAR LIMITED
REGISTERED NUMBER: 02937706
CONSOLIDATED BALANCE SHEET
AS AT 31 MARCH 2024
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ESKANDAR LIMITED
REGISTERED NUMBER: 02937706
CONSOLIDATED BALANCE SHEET (CONTINUED)
AS AT 31 MARCH 2024
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 19 to 41 form part of these financial statements.
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ESKANDAR LIMITED
REGISTERED NUMBER: 02937706
COMPANY BALANCE SHEET
AS AT 31 MARCH 2024
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ESKANDAR LIMITED
REGISTERED NUMBER: 02937706
COMPANY BALANCE SHEET (CONTINUED)
AS AT 31 MARCH 2024
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 19 to 41 form part of these financial statements.
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CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2024
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CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
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ESKANDAR LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2024
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ESKANDAR LIMITED
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2024
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ESKANDAR LIMITED
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ESKANDAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
The Company is a private company limited by shares. The Company is incorporated in England and Wales, registration number 02937706. The principal activity of the Company during the year was the designing, wholesaling and retailing of ladies luxury clothing and accessories. The address of the registered office is 2 London Wall Place, London, EC2Y 5AU.
2.Accounting policies
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires Group management to exercise judgment in applying the Group's accounting policies (see note 3).
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of Comprehensive Income in these financial statements.
The following principal accounting policies have been applied:
The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Balance Sheet, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated Statement of Comprehensive Income from the date on which control is obtained. They are deconsolidated from the date control ceases.
The financial statements have been prepared on a going concern basis. The Director has considered relevant information, including the forecast future cash flows and the impact of subsequent events in making their assessment.The shareholder has also pledged to continue to support the
group/company for a period of at least 12 months following the balance sheet sign-off. Based on these assessments and having regard to the resources available to the entity, the Director has concluded that there is no material uncertainty and that they can continue to adopt the going concern basis in preparing the annual report and accounts.
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ESKANDAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
2.Accounting policies (continued)
Functional and presentation currency
Transactions and balances
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ESKANDAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
2.Accounting policies (continued)
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ESKANDAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
2.Accounting policies (continued)
Goodwill
Other intangible assets
All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.
Lease premiums are amortised over the term of the lease.
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ESKANDAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
2.Accounting policies (continued)
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
Assets that are subject to depreciation or amortisation are assessed at each balance sheet date to determine whether there is any indication that the assets are impaired. Where there is any indication that an asset may be impaired, the carrying value of the asset (or cash-generating unit to which the asset has been allocated) is tested for impairment. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's (or CGU's) fair value less costs to sell and value in use.
For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (CGUs). Non-financial assets that have been previously impaired are reviewed at each balance sheet date to assess whether there is any indication that the impairment losses recognised in prior periods may no longer exist or may have decreased.
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ESKANDAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
2.Accounting policies (continued)
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
The Group has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.
The Group has elected to apply the recognition and measurement provisions of IFRS 9 Financial Instruments (as adopted by the UK Endorsement Board) with the disclosure requirements of Sections 11 and 12 and the other presentation requirements of FRS 102.
Financial instruments are recognised in the Group's Balance Sheet when the Group 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 trade and other debtors, cash and bank balances, are initially measured at their transaction price (adjusted for transaction costs except in the initial measurement of financial assets that are subsequently measured at fair value through profit and loss) and are
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ESKANDAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
2.Accounting policies (continued)
subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.
Discounting is omitted where the effect of discounting is immaterial. The Group's cash and cash equivalents, trade and most other debtors due with the operating cycle fall into this category of financial instruments.
Other financial assets
Other financial assets, which includes investments in equity instruments which are not classified as subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the recognised transaction price. Such assets are subsequently measured at fair value with the changes in fair value being recognised in the profit or loss. Where other financial assets are not publicly traded, hence their fair value cannot be measured reliably, they are measured at cost less impairment.
Impairment of financial assets
At the end of each reporting period financial assets measured at amortised cost are assessed for objective evidence of impairment. 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.
Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.
If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.
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 Group after the deduction of all its liabilities.
Basic financial liabilities, which include trade and other creditors, bank loans, other loans and loans due to fellow group companies are initially measured at their transaction price (adjusting for transaction costs except in the initial measurement of financial liabilities that are subsequently measured at fair value through profit and loss). When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future payments discounted at a market rate of interest, discounting is omitted where the effect of discounting is immaterial.
Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.
Trade creditors are obligations to pay for goods and services that have been acquired in the ordinary
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ESKANDAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
2.Accounting policies (continued)
course of business from suppliers. Trade creditors are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade creditors are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.
Other financial instruments
Derivatives, including forward exchange contracts, futures contracts and interest rate swaps, are not classified as basic financial instruments. These are initially recognised at fair value on the date the derivative contract is entered into, with costs being charged to the profit or loss. They are subsequently measured at fair value with changes in the profit or loss.
Debt instruments that do not meet the conditions as set out in FRS 102 paragraph 11.9 are subsequently measured at fair value through the profit or loss. This recognition and measurement would also apply to financial instruments where the performance is evaluated on a fair value basis as with a documented risk management or investment strategy.
Derecognition of financial instruments
Derecognition of financial assets
Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Group transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Group will continue to recognise the value of the portion of the risks and rewards retained.
Derecognition of financial liabilities
Financial liabilities are derecognised when the Group's contractual obligations expire or are discharged or cancelled.
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ESKANDAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
Trade debtors Management apply judgement in evaluating the recoverability of debtors. To the extent that the Director believes debtors not to be recoverable, they have been provided for in the financial statements. Stock Management apply judgement in evaluating stock for slow-moving and obsolescence. The judgement is based on management's knowledge of the stock and customer demand, as well as the age of stock. At each balance sheet date, stocks are assessed for impairment and written down where appropriate. Investments Management apply judgement in evaluating investments for overstatement. The judgement is based on the projected net present value of future cash flows. At each balance sheet date, investments are assessed for impairment and written down where appropriate. Stock returns provision Management apply judgment in evaluating the required provision for the return of stock from third parties and subsidiaries. The judgement is based on projected returns of stock and net realisable value of stock lines. Dilapidation provision Management apply judgement in evaluating the required provision for dilapidation. The judgement is based on management knowledge of the expected costs to repair damages and reinstate alterations.
Analysis of turnover by country of destination:
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ESKANDAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
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ESKANDAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
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ESKANDAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
10.Taxation (continued)
There were no factors that may affect future tax charges.
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ESKANDAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
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ESKANDAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
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ESKANDAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
13.Tangible fixed assets (continued)
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ESKANDAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
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ESKANDAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
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ESKANDAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
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ESKANDAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
The company has bank and non-bank loans which accrue interest at Base rate + between 4% - 29% per annum. Bank loans are secured by an unlimited debenture over the Company's assets.
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ESKANDAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
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ESKANDAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
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ESKANDAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
23.Provisions (continued)
Share premium account
Foreign exchange reserve
Profit and loss account
The Group operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Group in an independently administered fund. The pension cost charge represents contributions payable by the Group to the fund and amounted to £98,231 (2023 - £100,616). Contributions totalling £13,754 (2023: £12,094) were payable to the fund at the balance sheet date.
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ESKANDAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
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