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REGISTERED NUMBER: 00911692 (England and Wales)















ERF ELECTRICAL WHOLESALERS LTD.

STRATEGIC REPORT,

REPORT OF THE DIRECTORS AND

FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024






ERF ELECTRICAL WHOLESALERS LTD. (REGISTERED NUMBER: 00911692)






CONTENTS OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024




Page

Company Information 1

Strategic Report 2

Report of the Directors 3

Report of the Independent Auditors 5

Statement of Income and Retained Earnings 9

Statement of Financial Position 10

Statement of Cash Flows 11

Notes to the Statement of Cash Flows 12

Notes to the Financial Statements 14


ERF ELECTRICAL WHOLESALERS LTD.

COMPANY INFORMATION
FOR THE YEAR ENDED 31 DECEMBER 2024







DIRECTORS: Mr R Combellack
Mr T Combellack
Mr S Jones





SECRETARY: Mr A Smith





REGISTERED OFFICE: Salop Street
Daybrook
Nottinghamshire
NG5 6HD





REGISTERED NUMBER: 00911692 (England and Wales)





AUDITORS: Higson & Co (Nottingham) Limited
White House
Wollaton Street
Nottingham
Nottinghamshire
NG1 5GF

ERF ELECTRICAL WHOLESALERS LTD. (REGISTERED NUMBER: 00911692)

STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024

The directors present their strategic report for the year ended 31 December 2024.

REVIEW OF BUSINESS
The company's principal activity during the year continued to be the wholesale of electrical products.

The key financial and other performance indicators during the year were as follows:

2024 2023 Change
£ £ %

Turnover 25,078,624 26,672,743 (5.97% )
Operating profit/(loss) 287,567 180,001 59.76%
Loss after tax (61,443 ) (148,561 ) 58.64%
Equity shareholders' funds 1,919,237 1,980,680 (3.10% )

Current assets as % of current liabilities ('quick ratio') 113 116 (2.58% )
Average number of employees 92 102 (9.80% )

The company has not increased turnover although gross margins have increased during 2024. The board is committed to increasing turnover as well as gross margins.
Gross margins have increased from 23.2% in 2023 to 24.7% in 2024. Overhead expenses have decreased from £6.37m in 2023 to £6.27m in 2024. The company incurred pre-tax loss of £76k compared to a 2023 pre-tax loss of £186k, with a current tax credit of £38k (2023: tax credit of £38k)..

Net cash flow from operating activities has decreased during 2024 from an inflow in 2023 of £722k to an inflow in 2024 of £185k. The outflow from capital expenditure was £62k (2023: 138k) .Inflows from financing activities were £97k in 2024 (2023 outflows £395k Borrowings at the year end from the company's bankers, other loans and on hire purchase contracts were decreased at £4.34m (2023: £4.49m).

PRINCIPAL RISKS AND UNCERTAINTIES
The company has exposure to the following main areas of risk:

Liquidity risk
The objective of the company in managing liquidity risk is to ensure that it can meet its financial obligations as and when they fall due. The company expects to meet its financial obligations through operating cash flows. In the event that the operating cash flows would not cover all the financial obligations, the company has credit facilities available. Given that the company operates on a bank overdraft with additional facilities available, the company is in a position to meet its commitments and obligations as they become due.

Customer credit exposure
The company generally offers credit terms to its customers which allow payment of the debt after delivery of the goods. The company is at risk to the extent that a customer may be unable to pay the debt by the specified due date. This risk is mitigated by the strong on-going customer relationships and by credit insurance.

ON BEHALF OF THE BOARD:





Mr A Smith - Secretary


19 June 2025

ERF ELECTRICAL WHOLESALERS LTD. (REGISTERED NUMBER: 00911692)

REPORT OF THE DIRECTORS
FOR THE YEAR ENDED 31 DECEMBER 2024

The directors present their report with the financial statements of the company for the year ended 31 December 2024.

PRINCIPAL ACTIVITY
The principal activity of the company in the year under review was that of wholesale electrical merchants.

DIVIDENDS
No dividends will be distributed for the year ended 31 December 2024.

RESEARCH AND DEVELOPMENT
Development costs are amortised evenly over their estimated useful life of ten years, from the commencement of use of the asset.

Software development costs are recognised as an intangible asset when all of the following criteria are demonstrated:
- The technical feasibility of completing the software so that it will be available for use.
- The intention to complete the software and use it.
- The ability to use the software.
- How the software will generate probable future economic benefits.
- The availability of adequate technical, financial and other resources to complete the development and to
use the software.
- The ability to measure reliably the expenditure attributable to the software during its development.

FUTURE DEVELOPMENTS
The aim of the board is to increase shareholder value, develop a culture for growth, maintain a high rate of success through technical competence and to ensure a high level of ethical and moral Corporate Responsibility to the public, employees and shareholders.

DIRECTORS
The directors shown below have held office during the whole of the period from 1 January 2024 to the date of this report.

Mr R Combellack
Mr T Combellack
Mr S Jones

Other changes in directors holding office are as follows:

Mr A Laycock ceased to be a director after 31 December 2024 but prior to the date of this report.

GOING CONCERN
After making enquiries, the Directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. For this reason, they continue to adopt the going concern basis in preparing the accounts.

DIRECTORS' LIABILITIES POTENTIAL
The company has granted indemnities to its directors against liability in respect of proceedings brought by third parties, subject to conditions set out in the company's Articles of Association and the Companies Act 2006. Such qualifying third party indemnity provision remains in force as at the date of approving the directors' report.

DISCLOSURE IN THE STRATEGIC REPORT
The "Review of the Business" and the "Principal Risks and Uncertainties" disclosures are included in the Strategic Report.


ERF ELECTRICAL WHOLESALERS LTD. (REGISTERED NUMBER: 00911692)

REPORT OF THE DIRECTORS
FOR THE YEAR ENDED 31 DECEMBER 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), 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 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:



Mr A Smith - Secretary


19 June 2025

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF
ERF ELECTRICAL WHOLESALERS LTD.

Opinion
We have audited the financial statements of ERF Electrical Wholesalers Ltd. (the 'company') for the year ended 31 December 2024 which comprise the Statement of Income and Retained Earnings, Statement of Financial Position, Statement of Cash Flows and Notes to the Statement of Cash Flows, 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 31 December 2024 and of its loss for the year then ended;
-have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
-have been prepared in accordance with the requirements of the Companies Act 2006.

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
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information
The 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.

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF
ERF ELECTRICAL WHOLESALERS LTD.


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.

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.

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF
ERF ELECTRICAL WHOLESALERS LTD.


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.

We identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and then design and perform audit procedures responsive to those risks, including obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion.

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, we considered the following:

the nature of the industry and sector, control environment and business performance;

results of our enquiries of management about their own identification and assessment of the risks of irregularities;

any matters we identified having obtained and reviewed the company’s documentation of their policies and procedures relating to (a) identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of noncompliance; (b) detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud; (c) the internal controls established to mitigate risks of fraud or non-compliance with laws and regulations; (d) the matters identified as to how and where fraud might occur in the financial statements and any potential indicators of fraud.

In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override.

We also obtained an understanding of the legal and regulatory frameworks that the company operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included the UK Companies Act, UK Corporate Governance Code and UK tax legislation.

In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which may be fundamental to the company's ability to operate or to avoid a material penalty.

As a result of performing the above, we identified no key audit matters relating to the potential risk of fraud.

Our procedures to respond to risks identified included the following:

reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements;

enquiring of management concerning actual and potential litigation and claims;

performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;

obtained an understanding of provisions and held discussions with management to understand the basis of recognition or non-recognition of provisions; and

in addressing the risk of fraud through management override of controls, 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.


REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF
ERF ELECTRICAL WHOLESALERS LTD.

We remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit

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.




Simon Skill FCA (Senior Statutory Auditor)
for and on behalf of Higson & Co (Nottingham) Limited
White House
Wollaton Street
Nottingham
Nottinghamshire
NG1 5GF

19 June 2025

ERF ELECTRICAL WHOLESALERS LTD. (REGISTERED NUMBER: 00911692)

STATEMENT OF INCOME AND
RETAINED EARNINGS
FOR THE YEAR ENDED 31 DECEMBER 2024

2024 2023
Notes £    £   

TURNOVER 5 25,078,624 26,672,743

Cost of sales (18,886,827 ) (20,493,289 )
GROSS PROFIT 6,191,797 6,179,454

Administrative expenses (5,904,230 ) (5,999,453 )
OPERATING PROFIT 7 287,567 180,001


Interest payable and similar expenses 8 (363,672 ) (366,604 )
LOSS BEFORE TAXATION (76,105 ) (186,603 )

Tax on loss 9 14,662 38,042
LOSS FOR THE FINANCIAL YEAR (61,443 ) (148,561 )

Retained earnings at beginning of year 1,962,180 2,110,741

RETAINED EARNINGS AT END OF
YEAR

1,900,737

1,962,180

ERF ELECTRICAL WHOLESALERS LTD. (REGISTERED NUMBER: 00911692)

STATEMENT OF FINANCIAL POSITION
31 DECEMBER 2024

2024 2023
Notes £    £    £    £   
FIXED ASSETS
Intangible assets 10 664,432 729,123
Tangible assets 11 401,022 622,113
1,065,454 1,351,236

CURRENT ASSETS
Stocks 12 2,948,909 3,235,692
Debtors 13 5,975,242 5,505,340
Cash at bank and in hand 58,546 114,872
8,982,697 8,855,904
CREDITORS
Amounts falling due within one year 14 7,831,177 7,629,292
NET CURRENT ASSETS 1,151,520 1,226,612
TOTAL ASSETS LESS CURRENT
LIABILITIES

2,216,974

2,577,848

CREDITORS
Amounts falling due after more than one year 15 (159,737 ) (418,168 )

PROVISIONS FOR LIABILITIES 19 (138,000 ) (179,000 )
NET ASSETS 1,919,237 1,980,680

CAPITAL AND RESERVES
Called up share capital 20 14,900 14,900
Capital redemption reserve 21 3,600 3,600
Retained earnings 21 1,900,737 1,962,180
SHAREHOLDERS' FUNDS 1,919,237 1,980,680

The financial statements were approved by the Board of Directors and authorised for issue on 19 June 2025 and were signed on its behalf by:




Mr R Combellack - Director



Mr T Combellack - Director


ERF ELECTRICAL WHOLESALERS LTD. (REGISTERED NUMBER: 00911692)

STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2024

2024 2023
Notes £    £   
Cash flows from operating activities
Cash generated from operations 1 548,420 1,155,593
Interest paid (350,264 ) (354,899 )
Interest element of hire purchase payments
paid

(13,408

)

(11,705

)
Tax paid 2 (67,461 )
Net cash from operating activities 184,750 721,528

Cash flows from investing activities
Purchase of tangible fixed assets (94,544 ) (170,999 )
Sale of tangible fixed assets 32,534 32,150
Net cash from investing activities (62,010 ) (138,849 )

Cash flows from financing activities
Loan repayments in year (287,727 ) (332,728 )
Capital repayments in year (38,526 ) (2,831 )
Net cash from financing activities (326,253 ) (335,559 )

(Decrease)/increase in cash and cash equivalents (203,513 ) 247,120
Cash and cash equivalents at beginning of
year

2

(3,692,619

)

(3,939,739

)

Cash and cash equivalents at end of year 2 (3,896,132 ) (3,692,619 )

ERF ELECTRICAL WHOLESALERS LTD. (REGISTERED NUMBER: 00911692)

NOTES TO THE STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2024

1. RECONCILIATION OF LOSS BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

2024 2023
£    £   
Loss before taxation (76,105 ) (186,603 )
Depreciation charges 356,395 405,050
Profit on disposal of fixed assets (8,602 ) (29,003 )
Finance costs 363,672 366,604
635,360 556,048
Decrease in stocks 286,783 101,059
(Increase)/decrease in trade and other debtors (469,902 ) 734,154
Increase/(decrease) in trade and other creditors 96,179 (235,668 )
Cash generated from operations 548,420 1,155,593

2. CASH AND CASH EQUIVALENTS

The amounts disclosed on the Statement of Cash Flows in respect of cash and cash equivalents are in respect of these Statement of Financial Position amounts:

Year ended 31 December 2024
31.12.24 1.1.24
£    £   
Cash and cash equivalents 58,546 114,872
Bank overdrafts (3,954,678 ) (3,807,491 )
(3,896,132 ) (3,692,619 )
Year ended 31 December 2023
31.12.23 1.1.23
£    £   
Cash and cash equivalents 114,872 220,626
Bank overdrafts (3,807,491 ) (4,160,365 )
(3,692,619 ) (3,939,739 )


ERF ELECTRICAL WHOLESALERS LTD. (REGISTERED NUMBER: 00911692)

NOTES TO THE STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2024

3. ANALYSIS OF CHANGES IN NET DEBT

At 1.1.24 Cash flow At 31.12.24
£    £    £   
Net cash
Cash at bank and in hand 114,872 (56,326 ) 58,546
Bank overdrafts (3,807,491 ) (147,187 ) (3,954,678 )
(3,692,619 ) (203,513 ) (3,896,132 )
Debt
Finance leases (136,239 ) 38,526 (97,713 )
Debts falling due within 1 year (287,727 ) 15,000 (272,727 )
Debts falling due after 1 year (387,118 ) 272,727 (114,391 )
(811,084 ) 326,253 (484,831 )
Total (4,503,703 ) 122,740 (4,380,963 )

ERF ELECTRICAL WHOLESALERS LTD. (REGISTERED NUMBER: 00911692)

NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

1. GENERAL INFORMATION

ERF Electrical Wholesalers Limited operates a number of branches in England,

The company is a private company limited by shares and is incorporated in England and Wales. The address of its registered office is Salop Street, Daybrook, Nottingham, NG5 6HD. A copy of the company's accounts may be obtained from its registered office.

2. STATUTORY INFORMATION

ERF Electrical Wholesalers Ltd. is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page.

The presentation currency of the financial statements is the Pound Sterling (£).


3. STATEMENT OF COMPLIANCE

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006.

4. ACCOUNTING POLICIES

Basis of preparing the financial statements
The financial statements have been prepared under the historical cost convention.

Going concern
The directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. The company therefore continues to adopt the going concern basis in preparing its financial statements.

Significant judgements and estimates
Key sources of estimation uncertainty
In order to prepare the financial statements, management and the Board make various judgments and estimates that can affect the amounts recognised in the financial statements for assets, liabilities, revenue and expenses as well as information in general. The judgments and estimates discussed in this section are those deemed to be most important for an understanding of the financial statements, considering the level of significant estimations and uncertainty. The conditions under which the company operates are gradually changing meaning that the judgments also change.

Impairment tests of non-current assets
The company's property, plant and equipment as well as its intangible assets, are stated at cost less accumulated depreciation or amortisation and any impairment losses. The useful life of an asset is estimated on acquisition and depreciated over that period. Useful lives of material assets are reviewed annually.
The carrying value of the company's non-current assets is tested for impairment whenever events or changes in circumstances indicate that the carrying value will not be recovered.

Old or slow-moving stocks
Significant estimates are made to determine the level of write-down of old or slow-moving stocks. The amount of the estimate of the write-down can affect results both positively and negatively. The amount of write-down is based upon the management's best estimate and is carried out on a specific basis throughout each year.

ERF ELECTRICAL WHOLESALERS LTD. (REGISTERED NUMBER: 00911692)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2024

4. ACCOUNTING POLICIES - continued

Turnover
Turnover is measured at the fair value of the consideration received or receivable, net of discounts, rebates and value added taxes.

Turnover from the wholesale sale of electrical goods is recognised when the significant risks and rewards of ownership of the goods has transferred to the buyer. This is usually at the point that the customer has signed for the delivery of the goods.

Goodwill
Goodwill, being the amount paid in connection with the acquisition of a business in 2017, is being amortised evenly over its estimated useful life of five years.

Intangible assets
Intangible assets are initially measured at cost. After initial recognition, tangible fixed assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

Development costs are amortised evenly over their estimated useful life of fifteen years, from the commencement of use of the asset.

Software development costs are recognised as an intangible asset when all of the following criteria are demonstrated:
- The technical feasibility of completing the software so that it will be available for use.
- The intention to complete the software and use it.
- The ability to use the software.
- How the software will generate probable future economic benefits.
- The availability of adequate technical, financial and other resources to complete the development and to
use the software.
- The ability to measure reliably the expenditure attributable to the software during its development.

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.
Short leasehold - Over the term of the lease
Plant and machinery - at varying rates on cost
Motor vehicles - 25% on cost

Tangible fixed assets are originally valued at cost price.

Stocks
Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.

Cost comprises the average cost price, excluding VAT.

Stocks are written down on a specific basis on a lower of cost and net realisable value basis.

Financial instruments
The company only enters into basic financial instruments which are transactions that result in the recognition of financial assets and liabilities like trade and other accounts receivable and payable, loans from banks and other third parties and loans to related parties.


ERF ELECTRICAL WHOLESALERS LTD. (REGISTERED NUMBER: 00911692)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2024

4. ACCOUNTING POLICIES - continued
Taxation
Taxation for the year 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 statement of financial position date.

Deferred taxation
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position 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 year 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 currency translation
Assets and liabilities in foreign currencies are translated into sterling at the average rates of exchange ruling during the financial period.

Transactions in foreign currencies are translated into sterling at the spot rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result in the period in which they arise.

Hire purchase and leases
Assets acquired by means of hire purchase contracts are recognised initially at the fair value of the asset at the inception of the contact. The corresponding liability to the finance company is included in the statement of financial position as a hire purchase obligation. Hire purchase payments are apportioned between interest and reduction of the hire purchase obligation using the effective interest method so as to achieve a constant rate of interest on the remaining balance of the liability. Hire purchase interest is deducted in measuring profit or loss. Assets held under hire purchase contracts are included in tangible fixed assets and depreciated and assessed for impairment losses in the same way as other assets owned outright.

Rentals payable under operating leases are charged to the profit and loss account on a straight-line basis over the lease term. Rental concessions made during the Covid-19 Pandemic are shown gross in Other Operating Income.

ERF ELECTRICAL WHOLESALERS LTD. (REGISTERED NUMBER: 00911692)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2024

4. ACCOUNTING POLICIES - continued

Employee benefits
The company provides a range of benefits to employees, including annual bonus arrangements, paid holiday arrangements, defined contribution pension plans and pension plans under auto enrolment.

Short term benefits
Short term benefits, including holiday pay and other similar non-monetary benefits are recognised as an expense in the period in which the service is received.

Defined contribution pension plans
The company operates a number of defined contribution plans for certain employees. A defined contribution plan is a pension plan under which the company pays fixed contributions into a separate entity. Once the contributions have been paid, the company has no further payment obligations. The contributions are recognised as an expense when they are due. Amounts not paid are shown in accruals in the balance sheet. The assets of the plans are held separately from the company in independently administered funds.

Auto enrolment plan
The company is obliged to operate auto enrolment pension plans for all its eligible employees, unless the eligible employee has opted out. Auto enrolment is a pension plan under which the company pays contributions to a separate entity based upon a fixed percentage of the employee's salary.The contributions are recognised as an expense when they are due and, if not paid, are shown in accruals. The assets of the plan are held separately from the company in independently administered funds.

Annual bonus plan
The company operates an annual bonus plan for each branch for distribution between the branch employees. An expense is recognised in the profit and loss account when the company has a legal or constructive obligation to make payments under the plans as a result of past events and a reliable estimate of the obligation can be made.

Debtors
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.

Creditors
Short term creditors 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.

Provisions for liabilities
Provisions are recognised when the company has a present obligation (legal or constructive) as a result of a past event, it is probable that the company will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.

5. TURNOVER

The turnover and loss before taxation are attributable to the one principal activity of the company.

All turnover is made within the UK.

ERF ELECTRICAL WHOLESALERS LTD. (REGISTERED NUMBER: 00911692)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2024

6. EMPLOYEES AND DIRECTORS
2024 2023
£    £   
Wages and salaries 2,901,524 3,049,292
Social security costs 294,115 300,550
Other pension costs 69,865 72,720
3,265,504 3,422,562

The average number of employees during the year was as follows:
2024 2023

Managerial and administration 27 30
Operatives 65 72
92 102

2024 2023
£    £   
Directors' remuneration 271,213 262,033

Information regarding the highest paid director is as follows:
2024 2023
£    £   
Emoluments etc 89,379 94,498

7. OPERATING PROFIT

The operating profit is stated after charging/(crediting):

2024 2023
£    £   
Depreciation - owned assets 225,274 244,619
Depreciation - assets on hire purchase contracts 66,429 95,740
Profit on disposal of fixed assets (8,602 ) (29,003 )
Development costs amortisation 64,691 64,691
Auditors' remuneration 24,000 22,000
Operating leases - land and buildings 442,183 430,067

8. INTEREST PAYABLE AND SIMILAR EXPENSES
2024 2023
£    £   
Bank interest 345,764 336,899
Other interest 4,500 18,000
Hire purchase 13,408 11,705
363,672 366,604

ERF ELECTRICAL WHOLESALERS LTD. (REGISTERED NUMBER: 00911692)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2024

9. TAXATION

Analysis of the tax credit
The tax credit on the loss for the year was as follows:
2024 2023
£    £   
Current tax:
UK corporation tax 26,338 (42 )

Deferred tax (41,000 ) (38,000 )
Tax on loss (14,662 ) (38,042 )

Reconciliation of total tax credit included in profit and loss
The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below:

2024 2023
£    £   
Loss before tax (76,105 ) (186,603 )
Loss multiplied by the standard rate of corporation tax in the UK of 25%
(2023 - 25%)

(19,026

)

(46,651

)

Effects of:
Expenses not deductible for tax purposes 6,017 11,702
Income not taxable for tax purposes (2,150 ) -
Utilisation of tax losses (6,428 ) -
Adjustments to tax charge in respect of previous periods - (42 )
Enhanced deductions - (3,162 )
Miscellaneous (1,328 ) 111
for tax claim
Deferred tax re change of rate 10,300 -
Effect on tax due to marginal relief (2,047 ) -
Total tax credit (14,662 ) (38,042 )

ERF ELECTRICAL WHOLESALERS LTD. (REGISTERED NUMBER: 00911692)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2024

10. INTANGIBLE FIXED ASSETS
Development
Goodwill costs Totals
£    £    £   
COST
At 1 January 2024
and 31 December 2024 100,000 973,693 1,073,693
AMORTISATION
At 1 January 2024 100,000 244,570 344,570
Amortisation for year - 64,691 64,691
At 31 December 2024 100,000 309,261 409,261
NET BOOK VALUE
At 31 December 2024 - 664,432 664,432
At 31 December 2023 - 729,123 729,123

11. TANGIBLE FIXED ASSETS
Short Plant and Motor
leasehold machinery vehicles Totals
£    £    £    £   
COST
At 1 January 2024 1,425,707 983,834 1,161,097 3,570,638
Additions 4,563 1,112 88,869 94,544
Disposals - - (120,745 ) (120,745 )
At 31 December 2024 1,430,270 984,946 1,129,221 3,544,437
DEPRECIATION
At 1 January 2024 1,186,645 860,884 900,996 2,948,525
Charge for year 132,296 38,631 120,776 291,703
Eliminated on disposal - - (96,813 ) (96,813 )
At 31 December 2024 1,318,941 899,515 924,959 3,143,415
NET BOOK VALUE
At 31 December 2024 111,329 85,431 204,262 401,022
At 31 December 2023 239,062 122,950 260,101 622,113

The net book value of tangible fixed assets includes £ 210,065 (2023 - £ 187,625 ) in respect of assets held under hire purchase contracts.

ERF ELECTRICAL WHOLESALERS LTD. (REGISTERED NUMBER: 00911692)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2024

12. STOCKS
2024 2023
£    £   
Stocks 2,948,909 3,235,692

In the current economic circumstances within the UK, the replacement cost of stocks is considerably greater than the value at which it is currently shown. However, the cost of calculating the replacement cost far outweighs the benefits of doing so,

13. DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
2024 2023
£    £   
Trade debtors 5,292,345 4,676,900
Other debtors 312,458 328,207
Due from related parties 56,500 340,000
Prepayments and accrued income 313,939 160,233
5,975,242 5,505,340

14. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
2024 2023
£    £   
Bank loans and overdrafts (see note 16) 4,227,405 4,080,218
Other loans (see note 16) - 15,000
Hire purchase contracts (see note 17) 52,367 105,189
Trade creditors 2,981,973 2,970,312
Tax 26,339 (1 )
Social security and other taxes 90,627 127,224
VAT 170,486 211,186
Other creditors 14,033 24,641
Accruals and deferred income 267,947 95,523
7,831,177 7,629,292

15. CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE
YEAR
2024 2023
£    £   
Bank loans (see note 16) 114,391 387,118
Hire purchase contracts (see note 17) 45,346 31,050
159,737 418,168

ERF ELECTRICAL WHOLESALERS LTD. (REGISTERED NUMBER: 00911692)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2024

16. LOANS

An analysis of the maturity of loans is given below:

2024 2023
£    £   
Amounts falling due within one year or on demand:
Bank overdrafts 3,954,678 3,807,491
Bank loans 272,727 272,727
Other loans - 15,000
4,227,405 4,095,218

Amounts falling due between one and two years:
Bank loans - 1-2 years 114,391 272,727

Amounts falling due between two and five years:
Bank loans - 2-5 years - 114,391

17. LEASING AGREEMENTS

Minimum lease payments fall due as follows:

Hire purchase contracts
2024 2023
£    £   
Net obligations repayable:
Within one year 52,367 105,189
Between one and five years 45,346 31,050
97,713 136,239

Non-cancellable operating leases
2024 2023
£    £   
Within one year 381,450 391,727
Between one and five years 609,211 775,814
990,661 1,167,541

ERF ELECTRICAL WHOLESALERS LTD. (REGISTERED NUMBER: 00911692)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2024

18. SECURED DEBTS

The following secured debts are included within creditors:

2024 2023
£    £   
Bank overdrafts 3,954,678 3,807,491
Bank loans 387,118 659,845
Other loans - 15,000
Hire purchase contracts 97,713 136,239
4,439,509 4,618,575

The bank overdraft is secured by a floating charge over all the assets of the company.

The bank loan is a Coronavirus Business Interruption Loan and as such, has been guaranteed by the Government.

The other loan is secured by fixed and floating charges over all the assets of the company.

The hire purchase creditors are secured on the assets concerned.

One landlord of one leasehold property has a charge secured as a rent deposit..

19. PROVISIONS FOR LIABILITIES
2024 2023
£    £   
Deferred tax 138,000 179,000

Deferred
tax
£   
Balance at 1 January 2024 179,000
Provided during year (41,000 )
Balance at 31 December 2024 138,000

The deferred tax balance is made up of accelerated capital allowances, less unused tax losses carried forward provided at the future corporation tax rate of 25%.

20. CALLED UP SHARE CAPITAL

Allotted, issued and fully paid:
Number: Class: Nominal 2024 2023
value: £    £   
14,900 Ordinary shares £1 14,900 14,900

Ordinary shares have full voting and dividend rights, and are not subject to any restrictions.

ERF ELECTRICAL WHOLESALERS LTD. (REGISTERED NUMBER: 00911692)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2024

21. RESERVES
Capital
Retained redemption
earnings reserve Totals
£    £    £   

At 1 January 2024 1,962,180 3,600 1,965,780
Deficit for the year (61,443 ) (61,443 )
At 31 December 2024 1,900,737 3,600 1,904,337

Called-up share capital - represents the nominal value of the shares that have been issued.

Capital Redemption reserve - represents the cost to the company of buying back part of its issued share capital, several years ago.

Retained earnings - includes all current and prior period retained profits and losses.

22. DIRECTORS' ADVANCES, CREDITS AND GUARANTEES

The following advances and credits to directors subsisted during the years ended 31 December 2024 and 31 December 2023:

2024 2023
£    £   
Mr R Combellack
Balance outstanding at start of year 2,536 2,536
Amounts repaid - -
Amounts written off - -
Amounts waived - -
Balance outstanding at end of year 2,536 2,536

Mr T Combellack
Balance outstanding at start of year 19,954 19,334
Amounts advanced - 620
Amounts repaid (620 ) -
Amounts written off - -
Amounts waived - -
Balance outstanding at end of year 19,334 19,954

Advances to or from directors have been interest-free and unsecured and have had no specific terms of repayment.

23. RELATED PARTY DISCLOSURES

Other related parties
2024 2023
£    £   
Rents charged by the related party 59,375 50,000
Amount due from related party 362,217 645,717

ERF ELECTRICAL WHOLESALERS LTD. (REGISTERED NUMBER: 00911692)

NOTES TO THE FINANCIAL STATEMENTS - continued
FOR THE YEAR ENDED 31 DECEMBER 2024

23. RELATED PARTY DISCLOSURES - continued

Rents of £59,375 (2023: £50,000) have been paid during the year to pension schemes and trusts controlled by R and/or T Combellack.

The company had lent £340,000 to FCC Electrical Limited, a company owned by the directors of ERF Electrical Wholesalers Ltd, Balance outstanding at 31st December 2024 £56,500.

The company has advanced £305,717 (2023: £305,717) to Light LED-Design Limited, a company owned by the directors of ERF Electrical Wholesalers Limited.

24. ULTIMATE CONTROLLING PARTY

The company is controlled by R Combellack and T Combellack.

25. FINANCIAL RISK MANAGEMENT

The company has exposure to the following main areas of risk:

Liquidity risk
The objective of the company in managing liquidity risk is to ensure that it can meet its financial obligations as and when they fall due. The company expects to meet its financial obligations through operating cash flows. In the event that the operating cash flows would not cover all the financial obligations, the company has credit facilities available. Given that the company operates on a bank overdraft with additional facilities available, the company is in a position to meet its commitments and obligations as they become due.

Customer credit exposure
The company generally offers credit terms to its customers which allow payment of the debt after delivery of the goods. The company is at risk to the extent that a customer may be unable to pay the debt by the specified due date. This risk is mitigated by the strong on-going customer relationships and by credit insurance.