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Consolidated Financial Statements
The Edward Alexander Group Ltd
For the year ended 31 March 2024
Registered number: 10990781
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The Edward Alexander Group Ltd
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Company Information
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B Hochfeld (resigned 30 January 2024)
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G Collier (resigned 30 January 2024)
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Chartered Accountants & Statutory Auditors
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12 - 15 Donegall Square West
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The Edward Alexander Group Ltd
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Contents
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Independent auditor's report
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Consolidated statement of comprehensive income
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Consolidated balance sheet
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Consolidated statement of changes in equity
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Company statement of changes in equity
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Consolidated statement of cash flows
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Consolidated analysis of net debt
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Notes to the financial statements
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The Edward Alexander Group Ltd
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Group strategic report
For the year ended 31 March 2024
The directors present their report and the financial statements of the Group for the year ended 31 March 2024.
The results presented on page 9 are broadly in line with the expectations of the directors.
Principal risks and uncertainties
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The Group uses various financial instruments including bank loans and overdrafts, cash, and various items, such as trade debtors and trade creditors that arise directly from its operations. The main purpose of these financial instruments is to raise finance for the Group's operations.
The existence of these financial instruments exposes the Group to a number of financial risks, which are described in more detail below.
The main risks arising from the Group's financial instruments are trade debt risk, interest rate risk and liquidity risk.
The directors review and agree policies for managing each of these risks and they are summarised below. These policies have remained unchanged from previous years.
Trade debt risk
The Group aims to mitigate credit risks using credit control policies and techniques common in businesses of our size.
Interest rate risk
The Group finances its operations through a mixture of retained profits and bank borrowings. The Group exposure to interest rate fluctuations on its borrowings is managed through annual review of its borrowing requirements. The directors do not see the situation changing significantly in the foreseeable future and see the Group's interest rate risk as minimal.
Liquidity risk
The Group seeks to manage financial risk by ensuring sufficient liquidity is available to meet foreseeable needs. Short-term flexibility is achieved by overdraft facilities.
Financial key performance indicators
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We consider that our key performance indicators are those that communicate the financial performance and strength of the Group, these being turnover, which totalled to £10,943,102 during the year, (2023: £11,748,297) and gross profit, which totalled to £4,736,192 during the year (2023: £4,878,178).
Other key performance indicators
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The directors do not consider any non-financial key performance indicators to be appropriate.
Page 1
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The Edward Alexander Group Ltd
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Group strategic report (continued)
For the year ended 31 March 2024
This report was approved by the board on 8 May 2025 and signed on its behalf.
Page 2
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The Edward Alexander Group Ltd
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Directors' report
For the year ended 31 March 2024
The directors present their report and the financial statements for the year ended 31 March 2024.
Directors' responsibilities statement
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The directors are responsible for preparing the Group strategic report, the Directors' report and the consolidated 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 the Group and of the profit or loss of the Group for that period.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the Group's financial statements and then apply them consistently;
∙make judgements and accounting estimates that are reasonable and prudent;
∙state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group 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 the Group and to 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 the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The principal activity of the Group is the sale of high end furnishings.
The loss for the year, after taxation, amounted to £680,359 (2023 - loss £77,086).
The directors do not recommend the payment of a dividend (2023: £Nil).
The directors who served during the year were:
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B Hochfeld (resigned 30 January 2024)
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G Collier (resigned 30 January 2024)
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Page 3
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The Edward Alexander Group Ltd
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Directors' report (continued)
For the year ended 31 March 2024
The Group plans to continue its present activities and ongoing growth strategies.
Matters covered in the Group strategic report
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Information the Group has chosen, in accordance with S414C (II) of the Companies Act 2006, to set out in the Strategic report which would otherwise by required by Schedule 7 of the 'Large and Medium-sized Companies and
Groups (Accounts and Reports) Regulations 2008' to be contained in the directors' report is as follows:
∙Principal risks and uncertainties; and
∙Financial key performance indicators
Disclosure of information to auditor
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Each of the persons who are directors at the time when this Directors' report is approved has confirmed that:
∙so far as the director is aware, there is no relevant audit information of which the Company and the Group's auditor is unaware, and
∙the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company and the Group's auditor is aware of that information.
Post balance sheet events
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There have been no significant events affecting the Group since the year end.
This report was approved by the board on 8 May 2025 and signed on its behalf.
Page 4
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Independent auditor's report to the members of The Edward Alexander Group Ltd
We have audited the financial statements of The Edward Alexander Group Ltd (the 'parent Company') and its subsidiaries (the 'Group'), which comprise the Consolidated Statement of comprehensive income, the Consolidated and Company Balance sheets, the Consolidated Statement of cash flows, the Consolidated and Company Statement of changes in equity for the financial year ended 31 March 2024, and the related 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 Edward Alexander Group Ltd's financial statements:
∙give a true and fair view in accordance with United Kingdom Generally Accepted Accounting Practice of the assets, liabilities and financial position of the Group's and the Company as at 31 March 2024 and of the Group financial performance and cash flows for the financial year then ended; and
∙have been prepared in accordance with the requirements of the Companies Act 2006.
We conducted our audit in accordance with International Standards on Auditing (UK) ('ISAs (UK)') and applicable law. Our responsibilities under those standards are further described in the 'Responsibilities of the auditor for the audit of the financial statements' section of our report. We are independent of the Group and Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, namely the FRC's Ethical Standard and the ethical pronouncements established by Chartered Accountants Ireland, applied as determined to be appropriate in the circumstances of the entity. 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
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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 Group's or the parent Company's ability to continue as a going concern for a period of at least twelve months from the date 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.
Page 5
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Independent auditor's report to the members of The Edward Alexander Group Ltd (continued)
Other information comprises the information included in the Annual Report, other than the financial statements and our Auditor's report thereon, including the Directors' report and the Strategic Report. The directors are responsible for the other information. Our opinion on the financial statements does not cover the 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 in the financial statements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. 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 and the Strategic Report for the financial year for which the financial statements are prepared is consistent with the financial statements, and
∙the Directors' report and the Strategic Report have been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
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In the light of the knowledge and understanding of the Company and its environment we have obtained in the course of the audit, we have not identified material misstatements in the Directors' report and the Strategic Report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
∙adequate accounting records have not been kept by the parent Company, or returns adequate for our audit have not been received from branches not visited by us; or
∙the parent 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 explanations we require for our audit.
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Independent auditor's report to the members of The Edward Alexander Group Ltd (continued)
Responsibilities of management and those charged with governance for the financial statements
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Management is responsible for the preparation of the financial statements which give a true and fair view in accordance with United Kingdom Generally Accepted Accounting Practice, including FRS102 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, management is responsible for assessing the Group and 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 management either intend to liquidate the Group and Company or to cease operations, or has no realistic alternative but to do so. Those charged with governance are responsible for overseeing the Group and Company's financial reporting process.
Responsibilities of the auditor for the audit of the financial statements
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The objectives of an auditor 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 their 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.
A further description of an auditor's 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 auditor's report.
Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud
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. Owing to the inherent limitations of an audit, there is an unavoidable risk that material misstatement in the financial statements may not be detected, even though the audit is properly planned and performed in accordance with ISAs (UK).
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below:
Based on our understanding of the Company and industry, we identified that the principal risks of non-compliance with Laws and regulations related to Data Privacy Law, Health and Safety Laws and Employment Law, and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those Laws and regulations that have a direct impact on the preparation of the financial statements such as Companies Act 2006 and UK tax legislation. The Audit engagement partner considered the experience and expertise of the engagement team to ensure that the team had appropriate competence and capabilities to identify or recognise non-compliance with the laws and regulation. We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to posting inappropriate journal entries to manipulate financial performance and management bias through judgements and assumptions in significant accounting estimates, in particular in relation to significant one-off or unusual transactions.
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Independent auditor's report to the members of The Edward Alexander Group Ltd (continued)
We apply professional scepticism through the audit to consider potential deliberate omission or concealment of significant transactions, or incomplete/inaccurate disclosures in the financial statements.
In response to these principal risks, our audit procedures included but were not limited to:
∙inquiries of management on the policies and procedures in place regarding compliance with laws and regulations, including consideration of known or suspected instances of non-compliance and whether they have knowledge of any actual, suspected or alleged fraud;
∙inspection of the Group’s regulatory and legal correspondence and review of minutes of the board of directors meetings during the year to corroborate inquiries made;
∙gaining an understanding of the internal controls established to mitigate risk related to fraud;
∙discussion amongst the engagement team in relation to the identified laws and regulations and regarding the risk of fraud, and remaining alert to any indications of non-compliance or opportunities for fraudulent manipulation of financial statements throughout the audit;
∙identifying and testing journal entries to address the risk of inappropriate journals and management override of controls;
∙designing audit procedures to incorporate unpredictability around the nature, timing or extent of our testing;
∙challenging assumptions and judgements made by management in their significant accounting estimates, including estimating useful lives of tangible and intangible fixed assets, estimation allowance for the impairment of bad debt, investments, and stock; and
∙review of the financial statement disclosures to underlying supporting documentation and inquiries of management.
The primary responsibility for the prevention and detection of irregularities including fraud rests with those charged with governance and management. As with any audit, there remains a risk of non-detection or irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations or override of internal controls.
The purpose of our audit work and to whom we owe our responsibilities
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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.
Bronagh Bourke (Senior statutory auditor)
for and on behalf of
Grant Thornton (NI) LLP
Chartered Accountants
Statutory Auditors
Belfast
8 May 2025
Page 8
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The Edward Alexander Group Ltd
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Consolidated statement of comprehensive income
For the year ended 31 March 2024
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Interest receivable and similar income
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Interest payable and similar expenses
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Loss for the financial year
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Unrealised surplus on revaluation of tangible fixed assets
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Total comprehensive income for the year
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Loss for the year attributable to:
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Owners of the parent Company
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Other comprehensive income amounted to £165,000 in 2024 (2023: £Nil).
All amounts relate to continuing operations.
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The notes on pages 17 to 41 form part of these financial statements.
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Page 9
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The Edward Alexander Group Ltd
Registered number:10990781
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Consolidated balance sheet
As at 31 March 2024
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Creditors: amounts falling due after more than one year
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Provisions for liabilities
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The financial statements were approved and authorised for issue by the board and were signed on its behalf on 8 May 2025.
The notes on pages 17 to 41 form part of these financial statements.
Page 10
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The Edward Alexander Group Ltd
Registered number:10990781
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Company balance sheet
As at 31 March 2024
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Creditors: amounts falling due after more than one year
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The financial statements were approved and authorised for issue by the board and were signed on its behalf on 8 May 2025.
The notes on pages 17 to 41 form part of these financial statements.
Page 11
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The Edward Alexander Group Ltd
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Consolidated statement of changes in equity
For the year ended 31 March 2024
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Surplus on revaluation of freehold property
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Consolidated statement of changes in equity
For the year ended 31 March 2023
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Shares issued during the year
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The notes on pages 17 to 41 form part of these financial statements.
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Page 12
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The Edward Alexander Group Ltd
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Company statement of changes in equity
For the year ended 31 March 2024
Company statement of changes in equity
For the year ended 31 March 2023
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Shares issued during the year
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The notes on pages 17 to 41 form part of these financial statements.
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Page 13
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The Edward Alexander Group Ltd
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Consolidated statement of cash flows
For the year ended 31 March 2024
Cash flows from operating activities
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Loss for the financial year
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Amortisation of intangible assets
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Depreciation of tangible assets
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Increase/(decrease) in creditors
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Net cash generated from operating activities
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Cash flows from investing activities
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Purchase of intangible fixed assets
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Purchase of tangible fixed assets
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Net cash outflow from investing activities
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Cash flows from financing activities
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(Net repayment)/new loans
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(Repayment of)/new finance leases
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Net cash (outflow)/inflow in financing activities
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Net (decrease) in cash and cash equivalents
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Cash and cash equivalents at beginning of year
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Page 14
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The Edward Alexander Group Ltd
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Consolidated statement of cash flows (continued)
For the year ended 31 March 2024
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Cash and cash equivalents at the end of year
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Cash and cash equivalents at the end of year comprise:
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The notes on pages 17 to 41 form part of these financial statements.
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Page 15
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The Edward Alexander Group Ltd
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Consolidated Analysis of Net Debt
For the year ended 31 March 2024
The notes on pages 17 to 41 form part of these financial statements.
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Page 16
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The Edward Alexander Group Ltd
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Notes to the financial statements
For the year ended 31 March 2024
The Edward Alexander Group Limited is a private company limited by shares, and incorporated in the United Kingdom. The address of its registered office is Unit 310-311 Chelsea Harbour, London, SW10 0XF.
The principal activity of the Group is the sale of high end furnishings.
2.Accounting policies
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Basis of preparation of financial statements
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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 judgement 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.
FRS 102 allows a qualifying entity certain disclosure exemptions, subject to certain conditions, which have been complied with, including notifications of, and no objections to, the use of exemptions by the Company's shareholders. The Company has taken advantage of the following exemptions in its individual financial statements:
−from preparing a statement of cashflows, on the basis that it is a qualifying entity and the consolidated statement of cashflows, included in these financial statements, includes the Company's cashflow;
−from the financial instrument disclosures, required under FRS 102 paragraphs 11.39 to 11.48A and paragraphs 12.26 to 12.29, as the information is provided in the consolidated financial statement disclosures;
−from disclosing share based payment arrangements, required under FRS 102 paragraphs 26.18 (c), 26.19, 26.21 and 26,23, concerning its own equity instruments. The Company financial statements are presented with the consolidated financial statements and the relevant disclosures are included therein; and
−from disclosing the Company key management personnel compensation, as required by FRS 102 paragraph 33.7.
The following principal accounting policies have been applied:
Page 17
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The Edward Alexander Group Ltd
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Notes to the financial statements
For the year ended 31 March 2024
2.Accounting policies (continued)
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 Group made a loss after tax of £680,358 (2023:£77,086) for the year to 31 March 2024 and had net assets of £2,647,204 (2023: £3,162,327) at the balance sheet date.
After reviewing the Group’s forecasts and projections, the directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. The Group therefore continues to adopt the going concern basis in preparing its financial statements.
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Foreign currency translation
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Functional and presentation currency
The Company's functional and presentational currency is GBP.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.
Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Consolidated statement of comprehensive income within 'finance income or costs'. All other foreign exchange gains and losses are presented in profit or loss within 'other operating income'.
Page 18
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The Edward Alexander Group Ltd
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Notes to the financial statements
For the year ended 31 March 2024
2.Accounting policies (continued)
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:
Sale of goods
Revenue from the sale of goods is recognised when all of the following conditions are satisfied:
∙the Group has transferred the significant risks and rewards of ownership to the buyer;
∙the Group 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 Group 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.
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Operating leases: the Group as lessee
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Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.
Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.
Interest income is recognised in profit or loss using the effective interest method.
Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.
All borrowing costs are recognised in profit or loss in the year in which they are incurred.
Page 19
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The Edward Alexander Group Ltd
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Notes to the financial statements
For the year ended 31 March 2024
2.Accounting policies (continued)
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.
Assets held under finance leases are recognised in the balance sheet as assets and liabilities at the lower of the fair value of the assets and the present value of the minimum lease payments, which is determined at the inception of the lease term. Any initial direct costs of the lease are added to the amount recognised as an asset.
Lease payments are apportioned between the finance charges and reduction of the outstanding lease liability using the effective interest method. Finance charges are allocated to each period so as to produce a constant rate of interest on the remaining balance of the liability.
Defined contribution pension plan
The Group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. Once the contributions have been paid the Group has no further payment obligations.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Balance sheet. The assets of the plan are held separately from the Group in independently administered funds.
Page 20
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The Edward Alexander Group Ltd
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Notes to the financial statements
For the year ended 31 March 2024
2.Accounting policies (continued)
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Current and deferred taxation
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The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Company and the Group operate and generate income.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:
∙The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
∙Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.
Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.
Page 21
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The Edward Alexander Group Ltd
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Notes to the financial statements
For the year ended 31 March 2024
2.Accounting policies (continued)
Goodwill
Goodwill represents the difference between amounts paid on the cost of a business combination and the acquirer’s interest in the fair value of the Group's share of its identifiable assets and liabilities of the acquiree at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is amortised on a straight-line basis to the Consolidated statement of comprehensive income over its useful economic life.
Negative goodwill
Negative goodwill is capitalised and recognised in the consolidated statement of comprehensive income
in the periods in which the non-monetary assets are recovered.
Other intangible assets
Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.
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.
Amortisation is provided on the following basis:
Goodwill - 10 years straight line
Negative goodwill - 10 years straight line
Development expenditure - 10 years straight line
Website development - 10 years straight line
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
At each reporting date the Group assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.
Page 22
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The Edward Alexander Group Ltd
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Notes to the financial statements
For the year ended 31 March 2024
2.Accounting policies (continued)
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Tangible fixed assets (continued)
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Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, on the following basis.
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.
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Revaluation of tangible fixed assets
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Individual freehold and leasehold properties are carried at current year value at fair value at the date of the revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses. Revaluations are undertaken with sufficient regularity to ensure the carrying amount does not differ materially from that which would be determined using fair value at the balance sheet date.
Fair values are determined from market based evidence normally undertaken by professionally qualified valuers.
Revaluation gains and losses are recognised in other comprehensive income unless losses exceed the previously recognised gains or reflect a clear consumption of economic benefits, in which case the excess losses are recognised in profit or loss.
Investments in subsidiaries are measured at cost less accumulated impairment.
Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads.
At each balance sheet date, stocks are assessed for impairment. If stock is 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 23
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The Edward Alexander Group Ltd
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Notes to the financial statements
For the year ended 31 March 2024
2.Accounting policies (continued)
Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
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Cash and cash equivalents
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Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.
In the Consolidated statement of cash flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Group's cash management.
Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
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Provisions for liabilities
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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, taking into account the related risks and uncertainties.
Increases in provisions are generally charged as an expense to profit or loss.
The Company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of an out-right short-term loan that is not at market rate, the financial asset or liability is measured, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost, unless it qualifies as a loan from a director in the case of a small company, or a public benefit entity concessionary loan.
Investments in non-derivative instruments that are equity to the issuer are measured:
∙at fair value with changes recognised in the Statement of comprehensive income if the shares are
Page 24
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The Edward Alexander Group Ltd
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Notes to the financial statements
For the year ended 31 March 2024
2.Accounting policies (continued)
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Financial instruments (continued)
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publicly traded or their fair value can otherwise be measured reliably;
∙at cost less impairment for all other investments.
Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Statement of comprehensive income.
For financial assets measured at amortised cost, the impairment loss is measured as the difference between an asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If a financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract.
For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount and best estimate of the recoverable amount, which is an approximation of the amount that the Company would receive for the asset if it were to be sold at the balance sheet date.
Financial assets and liabilities are offset and the net amount reported in the Balance sheet when there is an 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.
Page 25
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The Edward Alexander Group Ltd
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Notes to the financial statements
For the year ended 31 March 2024
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Judgements in applying accounting policies and key sources of estimation uncertainty
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Estimates and judgements are required when applying accounting policies. These are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
The Group makes estimates and assumptions concerning the future, which can involve a high degree of judgement or complexity. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below:
Useful lives of depreciable assets
Management reviews its estimate of the useful lives of depreciable assets at each reporting date, based on the expected utility of the assets. Uncertainties in these estimates relate to technical and physical obsolescence that may change the utility of certain property, plant and equipment.
Recoverability of debtors
Estimates are made in respect of the recoverable value of trade and other debtors. When assessing the level of provisions required, factors including current trading experience, historical experience and the aging profile of debtors are considered.
Provision for impairment of investments
Determining whether the carrying value of the financial assets have been impaired requires an estimation of the value in use of the Company's investment in subsidiaries. The value in use calculation requires the directors to estimate the future cash flows expected to arrive from these assets and a suitable discount in order to calculate present value. After reviewing these calculations, the directors have determined that £149,837 (2023:£Nil) impairment has arisen.
Estimating useful lives of intangible assets
The Company estimates the useful lives of intangible fixed assets based on the period over which the assets are expected to be available for use. The estimated useful lives are reviewed periodically and are updated if expectations differ from previous estimates due to prospective economic utilisation, technical or commercial obsolescence and legal or other limits on the use of the assets. In addition, estimation of the useful lives of intangible fixed assets are based on collective assessment of industry practice, internal technical evaluation and experience with similar assets. Actual results, however may vary due to changes in estimates brought about by changes in factors mentioned above.
Estimating allowance for impairment of stocks
Management estimates the net realisable values of stocks, taking into account the most reliable evidence available at each reporting date. The future realisation of these inventories may be affected by future technology or other market-driven changes that may reduce future selling prices.
Segmental information in respect of turnover is not disclosed in these financial statements as, in the opinion of the directors, to do so would be prejudicial to the interests of the Group.
Page 26
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The Edward Alexander Group Ltd
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Notes to the financial statements
For the year ended 31 March 2024
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The operating loss is stated after charging:
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Staff costs, including directors' remuneration, were as follows:
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Cost of defined contribution scheme
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The average monthly number of employees, including the directors, during the year was as follows:
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Page 27
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The Edward Alexander Group Ltd
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Notes to the financial statements
For the year ended 31 March 2024
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Group contributions to defined contribution pension schemes
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During the year retirement benefits were accruing to 5 directors (2023 - 5) in respect of defined contribution pension schemes.
The highest paid director received remuneration of £194,667 (2023 - £202,000).
The value of the Group's contributions paid to a defined contribution pension scheme in respect of the highest paid director amounted to £5,840 (2023 - £6,058).
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Interest payable and similar expenses
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Other loan interest payable
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Finance leases and hire purchase contracts
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Page 28
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The Edward Alexander Group Ltd
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Notes to the financial statements
For the year ended 31 March 2024
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Adjustments in respect of previous periods
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Origination and reversal of timing differences
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Factors affecting tax charge for the year
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The tax assessed for the year is higher than (2023 - lower than) the standard rate of corporation tax in the UK of 25% (2023 - 19%). The differences are explained below:
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Loss on ordinary activities before tax
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Loss on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2023 - 19%)
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Expenses not deductible for tax purposes
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Fixed asset timing differences
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Amortisation of goodwill on consolidation
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Adjustments to tax charge in respect of prior periods
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Adjustments to tax charge in respect of prior periods - Deferred tax
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Remeasurement of deferred tax for changes in tax rates
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Deferred tax not recognised
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Utilisation of available tax losses
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Tax losses carried forward
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Total tax credit for the year
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Page 29
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The Edward Alexander Group Ltd
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Notes to the financial statements
For the year ended 31 March 2024
10.Taxation (continued)
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Factors that may affect future tax charges
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The standard rate of UK Corporation Tax from 1 April 2023 has increased to 25% for companies generating taxable profits of more than £250,000. The previous 19% tax rate will continue to apply to 'small' companies with profits less than £50,000, with a 'taper relief rate' for those companies with profits between the new thresholds. Deferred tax assets and liabilities have been recognised using the tax rates applicable for the date the assets and liabilities are expected to reverse.
A deferred tax asset of £823,628 (2023: £805,959) has not been recognised on the basis that it is more likely than not that there will be no suitable taxable profits under which it can be recovered in the foreseeable future.
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Parent company loss for the year
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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 loss after tax of the parent Company for the year was £1,804,147 (2023 - loss £145,361).
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Goodwill on consolidation
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Negative goodwill on consolidation
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Page 30
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The Edward Alexander Group Ltd
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Notes to the financial statements
For the year ended 31 March 2024
12.Intangible assets (continued)
Page 31
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