| REGISTERED NUMBER: |
| ERF ELECTRICAL WHOLESALERS LTD. |
| STRATEGIC REPORT, |
| REPORT OF THE DIRECTORS AND |
| FINANCIAL STATEMENTS |
| FOR THE YEAR ENDED 31 DECEMBER 2024 |
| REGISTERED NUMBER: |
| 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: |
| SECRETARY: |
| REGISTERED OFFICE: |
| REGISTERED NUMBER: |
| AUDITORS: |
| 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: |
| 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. |
| Other changes in directors holding office are as follows: |
| 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: |
| 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. |
| for and on behalf of |
| White House |
| Wollaton Street |
| Nottingham |
| Nottinghamshire |
| NG1 5GF |
| 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 |
| Cost of sales | ( |
) | ( |
) |
| GROSS PROFIT |
| Administrative expenses | ( |
) | ( |
) |
| OPERATING PROFIT | 7 |
| Interest payable and similar expenses | 8 | ( |
) | ( |
) |
| LOSS BEFORE TAXATION | ( |
) | ( |
) |
| Tax on loss | 9 |
| LOSS FOR THE FINANCIAL YEAR | ( |
) | ( |
) |
| Retained earnings at beginning of year |
| RETAINED EARNINGS AT END OF YEAR |
| ERF ELECTRICAL WHOLESALERS LTD. (REGISTERED NUMBER: 00911692) |
| STATEMENT OF FINANCIAL POSITION |
| 31 DECEMBER 2024 |
| 2024 | 2023 |
| Notes | £ | £ | £ | £ |
| FIXED ASSETS |
| Intangible assets | 10 |
| Tangible assets | 11 |
| CURRENT ASSETS |
| Stocks | 12 |
| Debtors | 13 |
| Cash at bank and in hand |
| CREDITORS |
| Amounts falling due within one year | 14 |
| NET CURRENT ASSETS |
| TOTAL ASSETS LESS CURRENT LIABILITIES |
| CREDITORS |
| Amounts falling due after more than one year | 15 | ( |
) | ( |
) |
| PROVISIONS FOR LIABILITIES | 19 | ( |
) | ( |
) |
| NET ASSETS |
| CAPITAL AND RESERVES |
| Called up share capital | 20 |
| Capital redemption reserve | 21 |
| Retained earnings | 21 |
| SHAREHOLDERS' FUNDS |
| The financial statements were approved by the Board of Directors and authorised for issue on |
| 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 |
| Interest paid | ( |
) | ( |
) |
| Interest element of hire purchase payments paid |
( |
) |
( |
) |
| Tax paid | ( |
) |
| Net cash from operating activities |
| Cash flows from investing activities |
| Purchase of tangible fixed assets | ( |
) | ( |
) |
| Sale of tangible fixed assets |
| Net cash from investing activities | ( |
) | ( |
) |
| Cash flows from financing activities |
| Loan repayments in year | ( |
) | ( |
) |
| Capital repayments in year | ( |
) | ( |
) |
| Net cash from financing activities | ( |
) | ( |
) |
| (Decrease)/increase in cash and cash equivalents | ( |
) |
| Cash and cash equivalents at beginning of year |
2 |
(3,692,619 |
) |
(3,939,739 |
) |
| Cash and cash equivalents at end of year | 2 | ( |
) | ( |
) |
| 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 | ( |
) | ( |
) |
| Depreciation charges |
| Profit on disposal of fixed assets | ( |
) | ( |
) |
| Finance costs | 363,672 | 366,604 |
| 635,360 | 556,048 |
| Decrease in stocks |
| (Increase)/decrease in trade and other debtors | ( |
) |
| Increase/(decrease) in trade and other creditors | ( |
) |
| Cash generated from operations |
| 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 | ( |
) | ( |
) |
| (3,896,132 | ) | (3,692,619 | ) |
| Year ended 31 December 2023 |
| 31.12.23 | 1.1.23 |
| £ | £ |
| Cash and cash equivalents | 114,872 | 220,626 |
| Bank overdrafts | ( |
) | ( |
) |
| (3,692,619 | ) | (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 | ) | ( |
) | (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 |
| The presentation currency of the financial statements is the Pound Sterling (£). |
| 3. | STATEMENT OF COMPLIANCE |
| 4. | ACCOUNTING POLICIES |
| Basis of preparing the financial statements |
| 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 |
| 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 |
| Short leasehold | - |
| Plant and machinery | - |
| Motor vehicles | - |
| 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 |
| Social security costs |
| Other pension costs |
| The average number of employees during the year was as follows: |
| 2024 | 2023 |
| Managerial and administration | 27 | 30 |
| Operatives | 65 | 72 |
| 2024 | 2023 |
| £ | £ |
| Directors' remuneration |
| Information regarding the highest paid director is as follows: |
| 2024 | 2023 |
| £ | £ |
| Emoluments etc |
| 7. | OPERATING PROFIT |
| The operating profit is stated after charging/(crediting): |
| 2024 | 2023 |
| £ | £ |
| Depreciation - owned assets |
| Depreciation - assets on hire purchase contracts |
| Profit on disposal of fixed assets | ( |
) | ( |
) |
| Development costs amortisation |
| Auditors' remuneration |
| Operating leases - land and buildings |
| 8. | INTEREST PAYABLE AND SIMILAR EXPENSES |
| 2024 | 2023 |
| £ | £ |
| Bank interest |
| Other interest |
| Hire purchase |
| 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 | ( |
) |
| Deferred tax | ( |
) | ( |
) |
| Tax on loss | ( |
) | ( |
) |
| 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 | ( |
) | ( |
) |
| Loss multiplied by the standard rate of corporation tax in the UK of (2023 - |
( |
) |
( |
) |
| Effects of: |
| Expenses not deductible for tax purposes |
| Income not taxable for tax purposes | ( |
) |
| Utilisation of tax losses | ( |
) |
| Adjustments to tax charge in respect of previous periods | ( |
) |
| Enhanced deductions | ( |
) |
| Miscellaneous | ( |
) |
| for tax claim |
| Deferred tax re change of rate |
| Effect on tax due to marginal relief | ( |
) |
| 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 |
| AMORTISATION |
| At 1 January 2024 |
| Amortisation for year |
| At 31 December 2024 |
| NET BOOK VALUE |
| At 31 December 2024 |
| At 31 December 2023 |
| 11. | TANGIBLE FIXED ASSETS |
| Short | Plant and | Motor |
| leasehold | machinery | vehicles | Totals |
| £ | £ | £ | £ |
| COST |
| At 1 January 2024 |
| Additions |
| Disposals | ( |
) | ( |
) |
| At 31 December 2024 |
| DEPRECIATION |
| At 1 January 2024 |
| Charge for year |
| Eliminated on disposal | ( |
) | ( |
) |
| At 31 December 2024 |
| NET BOOK VALUE |
| At 31 December 2024 |
| At 31 December 2023 |
| 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 |
| 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 |
| Other debtors |
| Due from related parties | 56,500 | 340,000 |
| Prepayments and accrued income |
| 14. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
| 2024 | 2023 |
| £ | £ |
| Bank loans and overdrafts (see note 16) |
| Other loans (see note 16) |
| Hire purchase contracts (see note 17) |
| Trade creditors |
| Tax | ( |
) |
| Social security and other taxes |
| VAT | 170,486 | 211,186 |
| Other creditors |
| Accruals and deferred income |
| 15. | CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR |
| 2024 | 2023 |
| £ | £ |
| Bank loans (see note 16) |
| Hire purchase contracts (see note 17) |
| 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 |
| Bank loans |
| Other loans |
| Amounts falling due between one and two years: |
| Bank loans - 1-2 years |
| Amounts falling due between two and five years: |
| Bank loans - 2-5 years |
| 17. | LEASING AGREEMENTS |
| Minimum lease payments fall due as follows: |
| Hire purchase contracts |
| 2024 | 2023 |
| £ | £ |
| Net obligations repayable: |
| Within one year |
| Between one and five years |
| Non-cancellable | operating leases |
| 2024 | 2023 |
| £ | £ |
| Within one year |
| Between one and five years |
| 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 |
| Bank loans |
| Other loans |
| Hire purchase contracts | 97,713 | 136,239 |
| 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 |
| Provided during year | ( |
) |
| Balance at 31 December 2024 |
| 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: | £ | £ |
| 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 | 1,965,780 |
| Deficit for the year | ( |
) | ( |
) |
| At 31 December 2024 | 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 |
| £ | £ |
| Balance outstanding at start of year |
| Amounts repaid |
| Amounts written off | - | - |
| Amounts waived | - | - |
| Balance outstanding at end of year |
| Balance outstanding at start of year |
| Amounts advanced |
| Amounts repaid | ( |
) |
| Amounts written off | - | - |
| Amounts waived | - | - |
| Balance outstanding at end of year |
| Advances to or from directors have been interest-free and unsecured and have had no specific terms of repayment. |
| 23. | RELATED PARTY DISCLOSURES |
| 2024 | 2023 |
| £ | £ |
| Rents charged by the related party | 59,375 | 50,000 |
| Amount due from related party |
| 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. |