REGISTERED NUMBER: |
STRATEGIC REPORT, REPORT OF THE DIRECTORS AND |
AUDITED FINANCIAL STATEMENTS FOR THE PERIOD 31ST JULY 2023 TO 28TH JULY 2024 |
FOR |
VIRANI FOOD PRODUCTS LIMITED |
REGISTERED NUMBER: |
STRATEGIC REPORT, REPORT OF THE DIRECTORS AND |
AUDITED FINANCIAL STATEMENTS FOR THE PERIOD 31ST JULY 2023 TO 28TH JULY 2024 |
FOR |
VIRANI FOOD PRODUCTS LIMITED |
VIRANI FOOD PRODUCTS LIMITED (REGISTERED NUMBER: 01121605) |
CONTENTS OF THE FINANCIAL STATEMENTS |
FOR THE PERIOD 31ST JULY 2023 TO 28TH JULY 2024 |
Page |
Company Information | 1 |
Strategic Report | 2 |
Report of the Directors | 3 |
Report of the Independent Auditors | 5 |
Statement of Comprehensive Income | 7 |
Balance Sheet | 8 |
Statement of Changes in Equity | 9 |
Cash Flow Statement | 10 |
Notes to the Financial Statements | 11 |
VIRANI FOOD PRODUCTS LIMITED |
COMPANY INFORMATION |
FOR THE PERIOD 31ST JULY 2023 TO 28TH JULY 2024 |
DIRECTORS: |
SECRETARY: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
AUDITORS: |
Chartered Accountants & Statutory Auditors |
1 Doughty Street |
London |
WC1N 2PH |
BANKERS: |
South Midlands Corporate Banking Centre |
Quadra, 500 Pavilion Drive |
Northampton Business Park |
Northampton |
NN4 7YJ |
SOLICITORS: |
The Lakes |
Bedford Road |
Northampton |
NN4 7SH |
VIRANI FOOD PRODUCTS LIMITED (REGISTERED NUMBER: 01121605) |
STRATEGIC REPORT |
FOR THE PERIOD 31ST JULY 2023 TO 28TH JULY 2024 |
The directors present their strategic report for the period 31st July 2023 to 28th July 2024. |
REVIEW OF BUSINESS |
The company has generally maintained its margin through the period against an enduring tough grocery trading environment and significant supply chain disruption. It continues to put particular effort into its compliance with food safety regulation and holds globally recognised best practice accreditations. The year has seen yet more efforts towards tighter supply chain risk management and closer supplier partnerships. |
During the year, the company has continued operating from two sites. Estate master-planning in anticipation of future growth resulted in a decision to refurbish the manufacturing site and the project is now with professional advisers. |
Over the period, the company has worked in partnership with its customers on a pipeline of high-profile retail product launches. The company's herbs, spices and seasonings feature as ingredients in products ranging from ambient sauces to chilled and frozen ready meals. Pulse flours service the growing gluten free and plant-based protein markets. Sales grew by 7.7% over the year. |
Results: |
2024 | 2023 |
£ | £ |
Turnover | 21,398,468 | 19,882,182 |
Gross Profit | 5,712,198 | 5,309,204 |
Profit/(loss) after tax | (388,472 | ) | (414,483 | ) |
PRINCIPAL RISKS AND UNCERTAINTIES |
The nature of the company's business is to manage global supply chain risk, within defined boundaries, on behalf of its food industry clientèle. Established systems and controls are in place to mitigate such risks and a comprehensive suite of insurance cover, reviewed periodically, transfers much of the remaining liability. |
The company is pro-active in managing the several financial risks it faces. Trade debtors are managed in respect of credit and cash flow risk by policies concerning the credit offered to customers and the regular monitoring of amounts outstanding for both time and credit limits. A dedicated full-time credit controller is in place, working within tight management systems. The working capital cycle is designed to minimise trade creditors liquidity risk. In respect of bank balances, the liquidity risk is managed by maintaining a balance between the funding requirements to support operational and other activities and the banking facilities available. This activity is supported by regular short-term cash projections and considering the level of liquid assets in relation thereto. Treasury risks, primarily foreign exchange and interest rate risks, are managed by appropriate hedging instruments. |
STREAMLINED ENERGY AND CARBON REPORTING |
For the past few years, the Company has prioritised sustainability and energy efficiency as a key part of its business ethos, committing to investing in the necessary resources to help achieve a reduction of our carbon footprint across all parts of our business. The business is focused on continuing to carry out an energy reduction programme that will include purchasing electricity from renewable sources and other measures. In particular, a photo voltaic solution is due to be installed at the manufacturing site. |
ON BEHALF OF THE BOARD: |
VIRANI FOOD PRODUCTS LIMITED (REGISTERED NUMBER: 01121605) |
REPORT OF THE DIRECTORS |
FOR THE PERIOD 31ST JULY 2023 TO 28TH JULY 2024 |
The directors present their report with the financial statements of the company for the period 31st July 2023 to 28th July 2024. |
PRINCIPAL ACTIVITY |
The principal activity of the company in the period under review was that of processing spices and milling flour. |
DIVIDENDS |
Dividend of £60,000 (£0.06 per share) was paid during the year. |
FUTURE DEVELOPMENTS |
The Board expects sales of herbs, spices, seasonings and pastes to remain steady in 2024/25, given the product mix and clientèle; however, activity related to pulses and speciality crops (such as flour sales) is due to transfer to Legumology Limited pursuant to an earlier business sale agreement. The company intends to continue its capital expenditure program in order to meet demand in an effective manner, reap efficiencies and facilitate good hygiene. |
DIRECTORS |
The directors shown below have held office during the whole of the period from 31st July 2023 to the date of this report. |
GOING CONCERN |
The Directors note that for the period ended at the balance sheet date, the Company reported a loss before tax of £388,472, while maintaining net current assets of £3,703,070 and net assets of £4,417,670. Subsequent unaudited management accounts to March 2025 indicate further substantial losses before tax. |
These losses in the current financial period are primarily attributable to two causes: |
- | the final stage of addressing production backlogs that necessitated additional agency staffing and increased costs related to warehousing, freight, and other operational expenses; and |
- | the extra cost of tightening technical controls for allergen risk management within the company's supply chain to some of highest standards in the ingredients sector. |
Management has cleared the production backlog, albeit at elevated costs, and has returned to previous excellent levels of order fulfilment. The extra costs of tighter allergen controls will be recouped once sector wide investment in such risk management is reflected in market gross margins. |
As with many businesses the Company utilises banking facilities obtained from its bankers. These facilities were renewed in May 2024 and are scheduled for review in April 2025. The Company has maintained open communication with HSBC regarding its financial position and improvement strategies. |
The Board notes that approximately 77% of the Company's stock purchases are denominated in foreign currencies, primarily US Dollars and Euros. This significant foreign currency exposure presents additional challenges to the Company, as Sterling can experience volatility against both currencies. Unfavourable exchange rate movements can materially impact the Company's cost base and contribute to margin pressure. To mitigate the inherent risks associated with the significant foreign currency exposure, the Company has established a hedging strategy centred around forward foreign exchange contracts. |
After conducting a thorough review of the Company's financial projections, including sensitivity analyses under various scenarios, and considering the measures implemented, the Directors have a strong expectation that the Company has adequate resources to continue in operational existence for at least twelve months from the date of approval of these financial statements. |
This assessment is based on: |
- | the Company's substantial net asset position of £4,417,670 as at the balance sheet date; |
- | cash flow projections indicating good cash generation to the end of the 2024/25 financial year; |
- | the restoration of excellent levels of service fulfilment; |
- | early indicators of improved margins in the latest unaudited management accounts; |
- | the Company's strong relationship with its banking partner; |
- | continued support from key suppliers. |
Despite the recent challenges, the Directors believe that the fundamentals of the business remain sound and that the corrective actions being implemented will return the Company to profitability. The Directors therefore continue to adopt the going concern basis in preparing the financial statements. |
VIRANI FOOD PRODUCTS LIMITED (REGISTERED NUMBER: 01121605) |
REPORT OF THE DIRECTORS |
FOR THE PERIOD 31ST JULY 2023 TO 28TH JULY 2024 |
STATEMENT OF DIRECTORS' RESPONSIBILITIES |
The directors are responsible for preparing the Strategic Report, the Report of the Directors 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. |
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS |
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditors are aware of that information. |
ON BEHALF OF THE BOARD: |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
VIRANI FOOD PRODUCTS LIMITED |
Opinion |
We have audited the financial statements of Virani Food Products Limited (the 'company') for the period ended 28th July 2024 which comprise the Statement of Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement 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 the financial statements: |
- | give a true and fair view of the state of the company's affairs as at 28th July 2024 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 prepared in accordance with the requirements of the Companies Act 2006. |
Basis for opinion |
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' 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 draw attention to Note 2 of the financial statements, which indicates that the company incurred losses before tax of £388,472 for the period ended at the balance sheet date, while reporting net current assets of £3,703,070 and net assets of £4,417,670. As further indicated in Note 2, the Company's unaudited management accounts to March 2025 show further substantial losses before tax. The Company's ability to continue as a going concern is dependent on management being able to successfully implement measures to address the continuing losses and to improve liquidity, as well as on the continued availability of bank support and banking facilities. |
Our opinion is not modified in respect of this matter. |
Other information |
The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon. |
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. |
In connection with our audit of the financial statements, 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 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 the audit: |
- | the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements. |
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 Report of the Directors. |
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion: |
- | adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or |
- | the financial statements are not in agreement with the accounting records and returns; or |
- | certain disclosures of directors' remuneration specified by law are not made; or |
- | we have not received all the information and explanations we require for our audit. |
REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF |
VIRANI FOOD PRODUCTS LIMITED |
Responsibilities of directors |
As explained more fully in the Statement of Directors' Responsibilities set out on page four, 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 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. |
Auditors' 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 a Report of the Auditors 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. |
The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: |
- | we reviewed the financial statement disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations that have a direct effect on the financial statements; |
- | we enquired with the management team concerning actual and potential litigation and claims, including compliance with anti-bribery legislation; |
- | we reviewed the recent FSA Report and other food and hygiene audit reports and enquired with management regarding compliance with applicable food and hygiene standards; |
- | we performed analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud; |
- | we read minutes of meetings of those charged with governance and of the audit committee; |
- | we obtained an understanding of any provisions and held discussions with management to understand the basis of recognition or non-recognition of tax provisions/assets; and |
- | we addressed the risk of fraud through management override of controls by testing the appropriateness of journal entries and other adjustments; assessing whether the judgements made in making accounting estimates 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. |
Our audit procedures were designed to respond to risks of material misstatement in the financial statements, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery, misrepresentations or through collusion. There are inherent limitations in the audit procedures performed and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we are to become aware of it. |
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 Report of the Auditors. |
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 a Report of the Auditors 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 |
Chartered Accountants & Statutory Auditors |
1 Doughty Street |
London |
WC1N 2PH |
VIRANI FOOD PRODUCTS LIMITED (REGISTERED NUMBER: 01121605) |
STATEMENT OF COMPREHENSIVE INCOME |
FOR THE PERIOD 31ST JULY 2023 TO 28TH JULY 2024 |
Period | Period |
31/7/23 | 1/8/22 |
to | to |
28/7/24 | 30/7/23 |
Notes | £ | £ |
TURNOVER | 4 |
Cost of sales |
GROSS PROFIT |
Administrative expenses |
(192,260 | ) | (410,283 | ) |
Other operating income |
OPERATING LOSS | 6 | ( |
) | ( |
) |
Interest receivable and similar income |
(180,260 | ) | (396,279 | ) |
Interest payable and similar expenses | 7 |
LOSS BEFORE TAXATION | ( |
) | ( |
) |
Tax on loss | 8 | ( |
) |
LOSS FOR THE FINANCIAL PERIOD | ( |
) | ( |
) |
OTHER COMPREHENSIVE INCOME | - | - |
TOTAL COMPREHENSIVE INCOME FOR THE PERIOD |
( |
) |
Prior year adjustment | ( |
) |
TOTAL COMPREHENSIVE INCOME SINCE LAST ANNUAL REPORT |
(467,483 |
) |
VIRANI FOOD PRODUCTS LIMITED (REGISTERED NUMBER: 01121605) |
BALANCE SHEET |
28TH JULY 2024 |
2024 | 2023 |
Notes | £ | £ | £ |
FIXED ASSETS |
Tangible assets | 10 |
CURRENT ASSETS |
Stocks | 11 |
Debtors | 12 |
Cash at bank |
CREDITORS |
Amounts falling due within one year | 13 |
NET CURRENT ASSETS |
TOTAL ASSETS LESS CURRENT LIABILITIES |
PROVISIONS FOR LIABILITIES | 17 |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 18 |
Share premium | 19 |
Capital reserve | 19 |
Retained earnings | 19 |
SHAREHOLDERS' FUNDS |
The financial statements were approved by the Board of Directors and authorised for issue on |
VIRANI FOOD PRODUCTS LIMITED (REGISTERED NUMBER: 01121605) |
STATEMENT OF CHANGES IN EQUITY |
FOR THE PERIOD 31ST JULY 2023 TO 28TH JULY 2024 |
Called up |
share | Retained | Share | Capital | Total |
capital | earnings | premium | reserve | equity |
£ | £ | £ | £ | £ |
Balance at 1st August 2022 |
Prior year adjustment | - | ( |
) | - | - | ( |
) |
As restated |
Changes in equity |
Dividends | - | ( |
) | - | - | ( |
) |
Total comprehensive income | - | ( |
) | - | ( |
) |
Balance at 30th July 2023 |
Changes in equity |
Dividends | - | ( |
) | - | - | ( |
) |
Total comprehensive income | - | ( |
) | - | ( |
) |
Balance at 28th July 2024 |
VIRANI FOOD PRODUCTS LIMITED (REGISTERED NUMBER: 01121605) |
CASH FLOW STATEMENT |
FOR THE PERIOD 31ST JULY 2023 TO 28TH JULY 2024 |
Period | Period |
31/7/23 | 1/8/22 |
to | to |
28/7/24 | 30/7/23 |
Notes | £ | £ |
Cash flows from operating activities |
Cash generated from operations | 26 | ( |
) | ( |
) |
Interest paid | ( |
) | ( |
) |
Tax paid | ( |
) |
Net cash from operating activities | ( |
) | ( |
) |
Cash flows from investing activities |
Purchase of tangible fixed assets | ( |
) | ( |
) |
Interest received |
Net cash from investing activities | ( |
) | ( |
) |
Cash flows from financing activities |
New loans in year |
Capital repayments of HP/FL in year | ( |
) | ( |
) |
Equity dividends paid | ( |
) | ( |
) |
Net cash from financing activities |
Decrease in cash and cash equivalents | ( |
) | ( |
) |
Cash and cash equivalents at beginning of period |
27 |
797,575 |
Cash and cash equivalents at end of period | 27 | 119,661 | 611,312 |
VIRANI FOOD PRODUCTS LIMITED (REGISTERED NUMBER: 01121605) |
NOTES TO THE FINANCIAL STATEMENTS |
FOR THE PERIOD 31ST JULY 2023 TO 28TH JULY 2024 |
1. | STATUTORY INFORMATION |
Virani Food Products Limited is a |
2. | STATEMENT OF COMPLIANCE |
3. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
The financial statements have been prepared under the historical cost convention as modified by the revaluation of certain assets. |
Going Concern |
The financial statements have been prepared on a going concern basis, which assumes the realisation of assets at the values stated in these financial statements and the settlement of liabilities in the normal course of business. |
For the financial year ended at the balance sheet date, the Company reported a loss before tax of £388,472, while maintaining net current assets of £3,703,070 and net assets of £4,417,670. Unaudited management accounts to March 2025 indicate a further substantial loss before tax. The loss in the current financial period is primarily attributable to two causes: |
- | the final stage of addressing production backlogs that necessitated additional agency staffing and increased costs related to warehousing, freight, and other operational expenses; and |
- | the extra cost of tightening technical controls for allergen risk management within the company's supply chain to some of highest standards in the ingredients sector. |
Management has cleared the production backlog, albeit at elevated costs, and has returned to previous excellent levels of order fulfilment. The extra costs of tighter allergen controls will be recouped once sector wide investment in such risk management is reflected in market gross margins. |
As with many other businesses, the Company utilises bank loans and other bank facilities. The Company's facilities are repayable on demand and subject to annual review - the next review is scheduled in April 2025. The Board is confident that the bank will renew these facilities, based on the Company's longstanding ability to service its debt obligations and meet interest and capital repayment requirements. The Board believes the Company will continue to operate within the current facilities provided by the bank and Company's suppliers. |
After evaluating these factors, the Board has a strong expectation that the Company has adequate resources to continue as a going concern. Accordingly, the financial statements have been prepared on this basis. The financial statements do not include any adjustments that would result from the going concern basis of preparation being inappropriate. |
Critical accounting judgements and key sources of estimation uncertainty |
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. |
The estimates and assumptions used in the accompanying financial statements are based upon management's evaluation of the relevant facts and circumstances as on the date of the financial statements. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future periods affected. |
Information about estimation uncertainties that may have a significant risk of resulting in a material adjustment within the next financial year are: |
Tangible fixed assets - the residual values of the fixed assets (excluding land) are reviewed annually after considering the remaining life of the asset and projected disposal values. The estimation of the useful lives is based on historic performance as well as expectation about future use and, therefore, requires a degree of judgement to be applied. The depreciation rates represent management's current best estimate of the useful lives of the assets. A material change in these estimates may significantly impact the carrying values of these assets. |
VIRANI FOOD PRODUCTS LIMITED (REGISTERED NUMBER: 01121605) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE PERIOD 31ST JULY 2023 TO 28TH JULY 2024 |
3. | ACCOUNTING POLICIES - continued |
Turnover |
Revenue for sale of goods is recognised when the significant risks and rewards of ownership have been transferred to the buyer, there is no continuing involvement with the goods, and the amount of revenue can be measured reliably, which can be on the date of shipment or the date of receipt by the customer. Transfer of risks and rewards varies depending on the individual terms of the contract of sale, including the delivery conditions, agreed with the customers. |
Revenue is recorded net of trade promotion and discounts, which is recognised as incurred, generally at the time of the sale. Accruals for expected promotion and discount payouts to customer are included as accruals in the Balance Sheet. Revenue is also recorded net of Value Added Tax. |
Tangible fixed assets |
Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life or, if held under a finance lease, over the lease term, whichever is the shorter. |
Property improvement - 10% on cost |
Plant and machinery - 15% on cost |
Fixtures and fittings - 25% on cost and 15% on cost |
Land and assets under construction are not depreciated |
Stocks |
Stock and work in progress are valued at the lower of cost and net realisable value, after making allowance for obsolete and slow- moving items. Cost is calculated by using the weighted average cost basis, over a 12-month period. |
Cost includes all direct expenditure and an appropriate proportion of fixed and variable overheads. |
Taxation |
Taxation for the period comprises current and deferred tax. Tax is recognised in the Statement of Comprehensive Income, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. |
Current or deferred taxation assets and liabilities are not discounted. |
Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date. |
Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date. |
Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the period end and that are expected to apply to the reversal of the timing difference. |
Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. |
Foreign currencies |
Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result. |
Hire purchase and leasing commitments |
Assets obtained under hire purchase contracts or finance leases are capitalised in the balance sheet. Those held under hire purchase contracts are depreciated over their estimated useful lives. Those held under finance leases are depreciated over their estimated useful lives or the lease term, whichever is the shorter. |
The interest element of these obligations is charged to the profit and loss account over the relevant period. The capital element of the future payments is treated as a liability. |
Rentals paid under operating leases are charged to the profit and loss account on a straight line basis over the period of the lease. |
VIRANI FOOD PRODUCTS LIMITED (REGISTERED NUMBER: 01121605) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE PERIOD 31ST JULY 2023 TO 28TH JULY 2024 |
3. | ACCOUNTING POLICIES - continued |
Pension costs and other post-retirement benefits |
The company operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the company in an independently administered fund. The pension charge represents contributions payable by the company to the scheme. |
Forward exchange contracts |
Forward exchange contracts are used to hedge foreign currency purchases of goods from overseas suppliers at some time in the future. |
Derivative financial instruments are initially measured at fair value on the contract date and are subsequently remeasured to fair value at each reporting date. Changes in the fair value of these derivatives financial instruments are recorded in the profit and loss account. |
Fixed assets investments |
Fixed assets investments are stated at cost less provision for any permanent diminution in value. |
Trade finance |
The company has trade receivables financing facilities that are with full recourse. Advances received by the company under the facility with full recourse are shown as bank loans under current liabilities. |
4. | TURNOVER |
The turnover and loss before taxation are attributable to the one principal activity of the company. |
An analysis of turnover by geographical market is given below: |
Period | Period |
31/7/23 | 1/8/22 |
to | to |
28/7/24 | 30/7/23 |
£ | £ |
United Kingdom |
Europe |
Rest of the world | 12,937 | 10,375 |
5. | EMPLOYEES AND DIRECTORS |
Period | Period |
31/7/23 | 1/8/22 |
to | to |
28/7/24 | 30/7/23 |
£ | £ |
Wages and salaries |
Social security costs |
Other pension costs |
VIRANI FOOD PRODUCTS LIMITED (REGISTERED NUMBER: 01121605) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE PERIOD 31ST JULY 2023 TO 28TH JULY 2024 |
5. | EMPLOYEES AND DIRECTORS - continued |
The average number of employees during the period was as follows: |
Period | Period |
31/7/23 | 1/8/22 |
to | to |
28/7/24 | 30/7/23 |
Production/Maintenance | 33 | 32 |
Quality/Hygiene | 14 | 14 |
Warehouse/Distribution | 8 | 8 |
Administrative | 27 | 26 |
Period | Period |
31/7/23 | 1/8/22 |
to | to |
28/7/24 | 30/7/23 |
£ | £ |
Directors' remuneration |
Directors' pension contributions to money purchase schemes |
The number of directors to whom retirement benefits were accruing was as follows: |
Money purchase schemes |
Information regarding the highest paid director is as follows: |
Period | Period |
31/7/23 | 1/8/22 |
to | to |
28/7/24 | 30/7/23 |
£ | £ |
Emoluments etc |
Pension contributions to money purchase schemes |
6. | OPERATING LOSS |
The operating loss is stated after charging: |
Period | Period |
31/7/23 | 1/8/22 |
to | to |
28/7/24 | 30/7/23 |
£ | £ |
Depreciation - owned assets |
Depreciation - assets on finance leases |
Auditors remuneration |
Foreign exchange differences |
VIRANI FOOD PRODUCTS LIMITED (REGISTERED NUMBER: 01121605) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE PERIOD 31ST JULY 2023 TO 28TH JULY 2024 |
7. | INTEREST PAYABLE AND SIMILAR EXPENSES |
Period | Period |
31/7/23 | 1/8/22 |
to | to |
28/7/24 | 30/7/23 |
£ | £ |
Bank interest |
8. | TAXATION |
Analysis of the tax charge/(credit) |
The tax charge/(credit) on the loss for the period was as follows: |
Period | Period |
31/7/23 | 1/8/22 |
to | to |
28/7/24 | 30/7/23 |
£ | £ |
Current tax: |
UK corporation tax | ( |
) |
Deferred taxation |
Tax on loss | ( |
) |
Reconciliation of total tax charge/(credit) included in profit and loss |
The tax assessed for the period is higher than the standard rate of corporation tax in the UK. The difference is explained below: |
Period | Period |
31/7/23 | 1/8/22 |
to | to |
28/7/24 | 30/7/23 |
£ | £ |
Loss before tax | ( |
) | ( |
) |
Loss multiplied by the standard rate of corporation tax in the UK of |
( |
) |
( |
) |
Effects of: |
Expenses not deductible for tax purposes |
Capital allowances in excess of depreciation | - | ( |
) |
Depreciation in excess of capital allowances | - |
Utilisation of tax losses |
Adjustments to tax charge in respect of previous periods | ( |
) |
R&D enhanced claims | (46,154 | ) | (33,581 | ) |
Tax losses carried forward | 124,285 | - |
Movements in deferred tax provisions | 40,000 | 58,000 |
Total tax charge/(credit) | 40,000 | (73,917 | ) |
Carried Forward Tax Losses |
At the reporting date, the company has unutilised tax losses of £672,936 (2023:£175,796) available to be utilised against future taxable profits. A deferred tax asset has not been recognised in respect of these losses due to uncertainty over future taxable profits. |
Had the deferred tax asset been recognised, it would have been measured at a tax rate of 25%, resulting in a potential deferred tax asset of £168,000. The company will continue to assess the recoverability of these losses in future periods. |
VIRANI FOOD PRODUCTS LIMITED (REGISTERED NUMBER: 01121605) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE PERIOD 31ST JULY 2023 TO 28TH JULY 2024 |
9. | DIVIDENDS |
Period | Period |
31/7/23 | 1/8/22 |
to | to |
28/7/24 | 30/7/23 |
£ | £ |
Ordinary shares of £1 each |
Final |
10. | TANGIBLE FIXED ASSETS |
Improvements | Fixtures | Assets |
to | Plant and | and | under |
property | machinery | fittings | construction | Totals |
£ | £ | £ | £ | £ |
COST |
At 31st July 2023 |
Additions |
Reclassification/transfer | ( |
) |
At 28th July 2024 |
DEPRECIATION |
At 31st July 2023 |
Charge for period |
At 28th July 2024 |
NET BOOK VALUE |
At 28th July 2024 |
At 30th July 2023 |
Fixed assets, included in the above, which are held under finance leases are as follows: |
Fixtures |
and |
fittings |
£ |
COST |
At 31st July 2023 |
and 28th July 2024 |
DEPRECIATION |
At 31st July 2023 |
Charge for period |
At 28th July 2024 |
NET BOOK VALUE |
At 28th July 2024 |
At 30th July 2023 |
VIRANI FOOD PRODUCTS LIMITED (REGISTERED NUMBER: 01121605) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE PERIOD 31ST JULY 2023 TO 28TH JULY 2024 |
11. | STOCKS |
2024 | 2023 |
£ | £ |
Raw materials |
Work-in-progress |
Finished goods |
12. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2024 | 2023 |
£ | £ |
Trade debtors |
Other debtors |
Taxation |
VAT |
Prepayments and accrued income |
13. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
2024 | 2023 |
£ | £ |
Bank loans and overdrafts (see note 14) |
Finance leases (see note 15) |
Trade creditors |
Social security and other taxes |
Other creditors |
Derivative liabilities | 124,115 | 191,763 |
Accrued expenses |
14. | LOANS |
An analysis of the maturity of loans is given below: |
2024 | 2023 |
£ | £ |
Amounts falling due within one year or on demand: |
Invoice Financing | 2,656,586 | 2,205,668 |
15. | LEASING AGREEMENTS |
Minimum lease payments fall due as follows: |
Finance leases |
2024 | 2023 |
£ | £ |
Net obligations repayable: |
Within one year |
VIRANI FOOD PRODUCTS LIMITED (REGISTERED NUMBER: 01121605) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE PERIOD 31ST JULY 2023 TO 28TH JULY 2024 |
15. | LEASING AGREEMENTS - continued |
Non-cancellable operating | leases |
2024 | 2023 |
£ | £ |
Within one year |
Between one and five years |
The commitments under non-cancellable operating leases mentioned above relate to one of the properties used by the Company. |
In addition, there is a licence to use agreement with a related company in connection to another property and few plant and machineries utilised by the Company. There is no commitment under the licence to use agreement and the management recharges paid to the related company are disclosed in the related party disclosures note. |
16. | SECURED DEBTS |
The following secured debts are included within creditors: |
2024 | 2023 |
£ | £ |
Bank loans |
Finance leases | 829 | 1,906 |
Finance lease creditors are secured on the assets to which they relate. |
The banking facilities are secured by a fixed and floating charge over its book debt and all other assets and undertakings of the company. Two other companies, with common directors and shareholders, have also provided securities to HSBC Bank plc for the facilities utilised by the Company. |
The company has, to-date, been able to service the bank debt and the Board believes that the company will continue to operate within the currently available facilities, most recently reviewed in May 2024. |
17. | PROVISIONS FOR LIABILITIES |
2024 | 2023 |
£ | £ |
Deferred tax |
Accelerated capital allowances |
Tax losses carried forward | ( |
) |
145,000 | 105,000 |
Deferred |
tax |
£ |
Balance at 31st July 2023 |
Charge to Statement of Comprehensive Income during period |
Balance at 28th July 2024 |
VIRANI FOOD PRODUCTS LIMITED (REGISTERED NUMBER: 01121605) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE PERIOD 31ST JULY 2023 TO 28TH JULY 2024 |
18. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 2024 | 2023 |
value: | £ | £ |
Ordinary | £1 | 1,000,000 | 1,000,000 |
19. | RESERVES |
Retained | Share | Capital |
earnings | premium | reserve | Totals |
£ | £ | £ | £ |
At 31st July 2023 | 3,866,142 |
Deficit for the period | ( |
) | ( |
) |
Dividends | ( |
) | ( |
) |
At 28th July 2024 | 3,417,670 |
20. | PENSION COMMITMENTS |
The company operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the company in an independently administered fund. The pension charge represents contributions payable by the company to the scheme. |
21. | CONTINGENT LIABILITIES |
The company is currently engaged in a dispute with a customer over the supply of goods that are alleged not to have complied with the relevant specification. The company is engaging actively with the other party to understand the basis for and extent of its liability (if any). It has notified its insurers and expects that, in the event that liability is established against it in respect of this dispute, it will be able to make a recovery of a proportion of the sums claimed by its customer from its insurance cover. At present, it is uncertain if the company will be liable at all; but in case it is, there is uncertainty of the amount of the liability and what portion is likely to be met by at least one of the company's insurers |
22. | CAPITAL COMMITMENTS |
2024 | 2023 |
£ | £ |
Contracted but not provided for in the |
financial statements |
23. | OTHER FINANCIAL COMMITMENTS |
As at 30th July 2024, the company had financial commitments to purchase USD 11,878,594 and EUR 3,916,809 arising from forward exchange rate agreements. |
VIRANI FOOD PRODUCTS LIMITED (REGISTERED NUMBER: 01121605) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE PERIOD 31ST JULY 2023 TO 28TH JULY 2024 |
24. | RELATED PARTY DISCLOSURES |
The Company undertook the following transactions with a company in which Mr T. Shah is a director and shareholder: |
2024 | 2023 |
£ | £ |
Sale of goods at arm's length | 177,168 | 157,920 |
Amount due from related party at balance sheet date | 16,351 | 30,969 |
The Company also undertook the following transactions with two other companies with common directors and/or shareholders ("the related companies"): |
2024 | 2023 |
£ | £ |
Sales made to the related companies | 1,276,212 | 1,441,460 |
Recharges for use of property and plant & machinery by the related companies | 426,186 | 475,070 |
Expense recharges to the related companies | 181,576 | - |
Royalty payments to the related companies | 15,557 | 16,000 |
Management charges receipts from the related companies | 12,000 | 12,000 |
Net amounts due from / (to) the related companies at balance sheet date | (79,165 | ) | 27,868 |
The related companies have also provided cross-guaranties as security to HSBC Bank plc in respect to banking facilities utilised by the Company. There is also a right to set-off with the related companies. |
25. | ULTIMATE CONTROLLING PARTY |
There was no ultimate controlling party throughout the current and previous year. |
26. | RECONCILIATION OF LOSS BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS |
Period | Period |
31/7/23 | 1/8/22 |
to | to |
28/7/24 | 30/7/23 |
£ | £ |
Loss before taxation | ( |
) | ( |
) |
Depreciation charges |
Profit/loss on derivatives | (67,648 | ) | 422,203 |
Finance costs | 168,212 | 92,121 |
Finance income | - | (2,004 | ) |
(28,460 | ) | 208,705 |
(Increase)/decrease in stocks | ( |
) |
(Increase)/decrease in trade and other debtors | ( |
) |
Increase/(decrease) in trade and other creditors | ( |
) |
Cash generated from operations | ( |
) | ( |
) |
VIRANI FOOD PRODUCTS LIMITED (REGISTERED NUMBER: 01121605) |
NOTES TO THE FINANCIAL STATEMENTS - continued |
FOR THE PERIOD 31ST JULY 2023 TO 28TH JULY 2024 |
27. | CASH AND CASH EQUIVALENTS |
The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts: |
Period ended 28th July 2024 |
28/7/24 | 31/7/23 |
£ | £ |
Cash and cash equivalents | 119,661 | 611,312 |
Period ended 30th July 2023 |
30/7/23 | 1/8/22 |
£ | £ |
Cash and cash equivalents | 611,312 | 797,575 |
28. | ANALYSIS OF CHANGES IN NET DEBT |
At 31/7/23 | Cash flow | At 28/7/24 |
£ | £ | £ |
Net cash |
Cash at bank | 611,312 | (491,651 | ) | 119,661 |
611,312 | ( |
) | 119,661 |
Debt |
Finance leases | (1,906 | ) | 1,077 | (829 | ) |
Debts falling due within 1 year | (2,205,668 | ) | (450,918 | ) | (2,656,586 | ) |
(2,207,574 | ) | (449,841 | ) | (2,657,415 | ) |
Total | (1,596,262 | ) | (941,492 | ) | (2,537,754 | ) |