For the financial year ended 31 December 2024 the group was entitled to exemption from audit under section 477 of the Companies Act 2006.
These financial statements have been prepared in accordance with the provisions applicable to groups and companies subject to the small companies regime.
As permitted by s408 Companies Act 2006, the company has not presented its own income statement and related notes. The company’s loss for the year was £34,385 (2023 - £53,223 loss).
The director acknowledges his responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.
Shani Group Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is 5th Floor, 3 Dorset Rise, London, EC4Y 8EN.
The group consists of Shani Group Limited and all of its subsidiaries.
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
The consolidated group financial statements consist of the financial statements of the parent company Shani Group Limited together with all entities controlled by the parent company (its subsidiaries).
All financial statements are made up to 31 December 2024. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
The financial statements have been prepared on a going concern basis, notwithstanding the group's excess of liabilities over assets at the balance sheet date.
The group's working capital needs are met through various financing arrangements, which include bank financing, counterparty financing facilities and related party and shareholder loans, each of which are drawn down to meet the requirements of the group's business, throughout its seasonal trading cycle.
The director acknowledges that if any of these existing facilities were to be withdrawn entirely or in part, it would place considerable pressure on the group and cast material doubt on its ability to continue as a going concern. However, the director is not currently aware of any reason why these facilities should not be made available for the foreseeable future.
This being the case, and based on forecasts prepared covering the period of 12 months from the date of the approval of these financial statements, the director is satisfied that the group will be able to meet its liabilities as they fall due. Accordingly he continues to adopt the going concern basis of accounting.
Revenue represents sales to customers at invoiced amounts less value added tax. Revenue is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
Customer returns and credit notes are provided for as a reduction to revenue based on management's best estimate of the amount required to meet claims by customers, taking into account historical trends and past experiences.
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the income statement.
Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.
In the parent company financial statements, investments in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the group's statement of financial position when the group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets, which include trade and other receivables and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in the income statement.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in the income statement.
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.
Basic financial liabilities, including trade and other payables and amounts due under invoice discounting facilities are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade payables are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
Amounts due in respect of invoice discounting are separately disclosed within current liabilities as borrowings.
The invoice discounting facility allows the group to draw down a percentage of the value of certain sales invoices. The management and collection of trade receivables remains with the group.
Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.
Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.
The tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred taxation is provided in full in respect of taxation deferred by timing differences between the treatment of certain items for taxation and accounting purposes.
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or non-current assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
The group makes contributions to the personal pension schemes of certain of its employees. Contributions payable are charged to the profit and loss account in the year they are payable.
Monetary assets and liabilities denominated in foreign currencies are translated into sterling at the exchange rates ruling at the balance sheet date. Transactions in the ordinary course of business denominated in foreign currencies are translated into sterling at the exchange rate contracted or ruling at the date of the transaction. All differences are taken to purchase and manufacturing costs of sales in the profit and loss account.
For the purposes of presenting consolidated financial statements, the assets and liabilities of the group's foreign operations are translated into sterling using exchange rates prevailing at the end of each reporting period. Exchange differences arising are dealt with through reserves and are presented in the statement of changes in equity.
The average monthly number of persons (including directors) employed by the group and company during the year was:
At the reporting date there were unpaid pension contributions of £4,063 (2023: £3,470).
At the balance sheet date, the other loans comprise unsecured loans owed to the company's director and sole shareholder, M.A. Hollis.
The total year end balance owed to M.A. Hollis was £1,715,666 (2023: £1,430,224). The balance was split between an interest bearing portion of £550,000, which is repayable in monthly instalments of £12,500 each and bears interest at 7.5% per annum. The remaining £1,165,666 owed to M.A. Hollis was interest free and repayable on demand.
Group and company
1) The company has provided guarantees in respect of certain of the contractual obligations of a former overseas subsidiary. There is an ongoing legal dispute with the counter-parties concerned, resulting in claims and counterclaims.
Based on independent advice received the director is of the opinion that there will be no material financial cost to the company or group as a consequence of this matter. A judgement was given in favour of the company, but this is now under appeal.
2) The group has granted fixed and floating legal charges over certain of its assets in favour of its bankers.
3) The group has given indemnities to its bankers in respect of a duty deferred payment guarantee of £500,000 (2023: £500,000).
Group and company
At the balance sheet date the group has unsecured loans from its director, M.A Hollis.
The terms of the loans are disclosed in Note 9.
Details of the company's subsidiaries at 31 December 2024 are as follows:
* - all companies are registered at 5th Floor 3 Dorset Rise, London, EC4Y 8EN