Company registration number 07729027 (England and Wales)
KOKORO UK LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024
KOKORO UK LIMITED
COMPANY INFORMATION
Directors
Mr Eun Gyu Ko
Mr Rak Kyu Park
Company number
07729027
Registered office
First Floor 4 Lyon Road
Hersham
Walton-on-Thames
KT12 3PU
Auditor
UHY Hacker Young LLP
Quadrant House
4 Thomas More Square
London
E1W 1YW
KOKORO UK LIMITED
CONTENTS
Page
Strategic report
1 - 3
Directors' report
4 - 5
Independent auditor's report
6 - 9
Statement of comprehensive income
10
Balance sheet
11 - 12
Statement of changes in equity
13
Statement of cash flows
14
Notes to the financial statements
15 - 27
KOKORO UK LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 AUGUST 2024
- 1 -
The directors present the strategic report for the year ended 31 August 2024.
Fair review of the business
Kokoro UK Limited continued its principal activity of managing and operating Asian restaurants across the UK. There are no plans to change its principal activities in the foreseeable future.
In the face of persistent economic challenges, including the cost-of-living crisis, the rise in minimum wage, and global supply chain issues, the Company has undertaken proactive measures to safeguard its operations and prepare future growth. These include benchmarking, innovating its menu, and enhancing customer service training to maintain its competitive edge. These measures, combined with the rollout of the new Korean-inspired menu across all branches, aim to strengthen the Company’s market position and align with evolving consumer preferences. In addition, the Company is positioning itself to adapt to anticipated changes in market conditions, supported by recent interest rate cuts and easing inflation.
Beyond operational challenges, Kokoro recognizes the importance of long-term resilience in a volatile global landscape. While supply chain disruptions caused by geopolitical tensions in Ukraine and the Middle East have eased to some extent, the ongoing challenge of elevated ocean freight charges continues to impact the cost of imported goods. To address this, the Company has diversified its sourcing strategy in partnership with Kokoro Trading Limited, exploring new supply chains in Southeast Asia to enhance cost competitiveness.
Maintaining high standards of product safety and quality remains a critical priority. Regular branch inspections and comprehensive staff training are integral to the Company’s risk mitigation strategy, ensuring high standards of food quality, compliance with health and safety standards while preserving consumer trust. Additionally, in response to growing concerns about environmental sustainability, Kokoro has developed a proprietary software program to reduce food waste through precise forecasting based on factors such as seasonality, weather, and special occasions. Following successful trials, the program will be expanded across more branches in the coming year, further demonstrating the Company’s commitment to environmental stewardship.
Risk management associated with lease agreements continues to demand careful oversight, particularly as the Company assumes the role of tenant when signing new lease contracts on behalf of some franchisees and joint ventures. To mitigate associated risks, the Company implements a rigorous vetting process to carefully assess potential franchise and joint venture partners while closely monitoring their business performance. Additionally, rent deposits are required from joint venture partners as a precautionary measure, and thorough reviews of contractual terms are conducted to secure favorable conditions and minimize potential liabilities.
Additionally, while there are no current legal proceedings, Kokoro remains vigilant against potential risks involving stakeholders, including employees, customers, and suppliers. Proactive measures, such as regular compliance checks and risk assessments, are undertaken to navigate changes in tax laws and other regulations that could significantly impact operations.
As the Company navigates these multifaceted challenges, its focus on adaptability, strategic innovation, and financial prudence positions it well for the future. While uncertainties persist, the Company remains optimistic about the opportunities that lie ahead, driven by a clear vision for sustainable growth and excellence in service.
KOKORO UK LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
- 2 -
Principal risks and uncertainties
Operational Risks
| Although the BOE has begun cutting interest rates, the cost-of-living crisis persists, creating a challenging environment for most F&B businesses across the UK, including Kokoro. This economic backdrop alongside with the upcoming rise of minimum wage continues to exert pressure on operational costs and consumer spending. In response, the Company is proactively implementing a range of measures, including the development of new menu lineups, to mitigate potential impacts on sales performance and operational margins stemming from these factors. |
| There are risks of losing ground to competitors in terms of pricing and market share, and negative feedback on social media platforms can tarnish the brand’s image if not handled properly. These risks can be mitigated by benchmarking, developing new menu items, and emphasizing training in customer service to minimize customer dissatisfaction. To address evolving consumer preferences, the Company has developed a new menu lineup centred on Korean cuisine, which is currently being rolled out across all branches. |
Product safety and quality | Product quality issues, such as poor food quality or instances of health hazards, can pose risks for any F&B business. These can be mitigated by conducting regular visits and staff training. |
| To address the issue of food wastage and improve stock management efficiency, the Company has developed an independent software program to forecast stock and sales more accurately. This system considers a variety of variables, such as seasons, weather, and occasions. We have tested the program in some of our branches and plan to expand its use this year. |
Financial Risks
| Kokoro has a lower risk of credit default. |
| The management closely monitors liquidity issues on a daily basis to effectively manage the level of working capital. |
| As anticipated, the BOE lowered its base interest rate to 4.25% and the Company is actively pursuing business expansion through the opening of new stores. However, borrowing costs and interest payments on loans remain at challenging levels. As such, the Company will carefully monitor economic conditions and adjust its expansion plans accordingly to ensure sustainable growth. |
KOKORO UK LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
- 3 -
Principal Risks & Uncertainities (continued)
Global Risks
| While the supply chain disruptions caused by the wars in Ukraine and Gaza have somewhat eased, the elevated ocean freight charges continue to pose a risk to the cost of imported goods. This persistent challenge impacts the Company’s ability to manage costs effectively. To mitigate these risks, the Company has re-evaluated and selected a new forwarder to enhance price competitiveness and remains committed to closely collaborating with its main supplier, Kokoro Trading Ltd., to seek out new supply chains beyond Europe (e.g., Southeast Asia) in order to minimize raw material procurement costs. |
Legal Regulations
Property contractual risks | Following last year, the signing of new lease contracts has remained slow; however, with the interest rate cuts, the Company plans to gradually expand its branches. As expansion progresses, thorough and meticulous reviews and examinations are required for any new or renewed contractual terms to identify potential issues with landlords, particularly concerning property maintenance or utility matters. Additionally, to mitigate potential risks associated with JV franchisee’s lease agreements signed under Kokoro UK Ltd.'s name, the Company charges JV partners a one-year rent deposit upfront. |
| There are currently no pending proceedings or lawsuits. Nonetheless, the Company could be subject to potential legal actions involving any of its stakeholders, including employees, customers, and suppliers, which may impact its operations. |
Tax law/liabilities risks | Any changes in taxation laws and regulations by the authorities can significantly impact the Company. Therefore, it must take proactive measures by staying informed about upcoming changes in tax laws and conducting regular compliance and risk assessment.. |
Mr Eun Gyu Ko
Director
28 August 2025
KOKORO UK LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 AUGUST 2024
- 4 -
The directors present their annual report and financial statements for the year ended 31 August 2024.
Principal activities
The principal activity of Kokoro UK Limited during the year continued to be the management and operation of Asian restaurants in the UK.
Results and dividends
The results for the year are set out on page 10.
No ordinary dividends were paid. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Mr Eun Gyu Ko
Mr Rak Kyu Park
Disabled persons
Applications for employment by disabled persons are always fully considered, bearing in mind the aptitudes of the applicant concerned. In the event of members of staff becoming disabled, every effort is made to ensure that their employment within the company continues and that the appropriate training is arranged. It is the policy of the company that the training, career development and promotion of disabled persons should, as far as possible, be identical to that of other employees.
Employee involvement
The company's policy is to consult and discuss with employees, through unions, staff councils and at meetings, matters likely to affect employees' interests.
Information about matters of concern to employees is given through information bulletins and reports which seek to achieve a common awareness on the part of all employees of the financial and economic factors affecting the company's performance.
There is no employee share scheme at present, but the directors are considering the introduction of such a scheme as a means of further encouraging the involvement of employees in the company's performance.
Auditor
The auditor, UHY Hacker Young LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
KOKORO UK LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
- 5 -
Statement of directors' responsibilities
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.
Medium-sized companies exemption
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
On behalf of the board
Mr Eun Gyu Ko
Director
28 August 2025
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF KOKORO UK LIMITED
- 6 -
Opinion
We have audited the financial statements of Kokoro UK Limited (the 'company') for the year ended 31 August 2024 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including 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 August 2024 and of its profit 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.
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 Auditor's 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.
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF KOKORO UK LIMITED (CONTINUED)
- 7 -
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. 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. 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 course of 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 our audit:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, 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 directors' responsibilities statement, 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 is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, 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.
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF KOKORO UK LIMITED (CONTINUED)
- 8 -
Auditor's 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 an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
Based on our understanding of the company and the industry in which it operates, we identified that the principal risks of non-compliance with laws and regulations related to the acts by the company, which were contrary to applicable laws and regulations including fraud, and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006. We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to understated revenue and results.
Audit procedures performed included: review of the financial statement disclosures to underlying supporting documentation, enquiries of management and testing of journals and evaluating whether there was evidence of bias by the Directors that represented a risk of material misstatement due to fraud.
There are inherent limitations in the audit procedures described above and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's 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 an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF KOKORO UK LIMITED (CONTINUED)
- 9 -
Vinodkumar Vadgama
Senior Statutory Auditor
For and on behalf of UHY Hacker Young LLP
28 August 2025
Chartered Accountants
Statutory Auditor
KOKORO UK LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 AUGUST 2024
- 10 -
2024
2023
Notes
£
£
Turnover
2
16,962,440
12,754,086
Cost of sales
(7,497,210)
(6,104,960)
Gross profit
9,465,230
6,649,126
Administrative expenses
(11,183,808)
(9,595,376)
Other operating income
2,626,742
3,046,107
Operating profit
3
908,164
99,857
Interest receivable and similar income
6
27,197
38,851
Interest payable and similar expenses
7
(92,413)
(108,981)
Profit before taxation
842,948
29,727
Tax on profit
8
(251,588)
(23,525)
Profit for the financial year
591,360
6,202
KOKORO UK LIMITED
BALANCE SHEET
AS AT 31 AUGUST 2024
31 August 2024
- 11 -
2024
2023
Notes
£
£
£
£
Fixed assets
Goodwill
10
465,483
372,083
Tangible assets
11
4,049,908
3,781,098
Investments
12
1,510
4,515,391
4,154,691
Current assets
Stocks
15
190,905
260,588
Debtors
16
1,426,210
1,062,509
Cash at bank and in hand
824,223
1,492,906
2,441,338
2,816,003
Creditors: amounts falling due within one year
17
(2,734,692)
(2,771,170)
Net current (liabilities)/assets
(293,354)
44,833
Total assets less current liabilities
4,222,037
4,199,524
Creditors: amounts falling due after more than one year
18
(392,707)
(953,071)
Provisions for liabilities
Deferred tax liability
20
301,704
310,187
(301,704)
(310,187)
Net assets
3,527,626
2,936,266
Capital and reserves
Called up share capital
23
100,000
100,000
Profit and loss reserves
3,427,626
2,836,266
Total equity
3,527,626
2,936,266
KOKORO UK LIMITED
BALANCE SHEET (CONTINUED)
AS AT 31 AUGUST 2024
31 August 2024
- 12 -
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.
The financial statements were approved by the board of directors and authorised for issue on 28 August 2025 and are signed on its behalf by:
Mr Eun Gyu Ko
Director
Company registration number 07729027 (England and Wales)
KOKORO UK LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 AUGUST 2024
- 13 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 September 2022
100,000
3,830,064
3,930,064
Year ended 31 August 2023:
Profit and total comprehensive income
-
6,202
6,202
Dividends
9
-
(1,000,000)
(1,000,000)
Balance at 31 August 2023
100,000
2,836,266
2,936,266
Year ended 31 August 2024:
Profit and total comprehensive income
-
591,360
591,360
Balance at 31 August 2024
100,000
3,427,626
3,527,626
KOKORO UK LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 AUGUST 2024
- 14 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
27
1,389,053
1,584,383
Interest paid
(92,413)
(108,981)
Income taxes paid
(1,680)
Net cash inflow from operating activities
1,296,640
1,473,722
Investing activities
Purchase of intangible assets
(140,000)
(340,000)
Purchase of tangible fixed assets
(828,370)
(2,184,657)
Proceeds from disposal of tangible fixed assets
877,552
Interest received
27,197
38,851
Net cash used in investing activities
(941,173)
(1,608,254)
Financing activities
Proceeds from new bank loans
266,140
Repayment of bank loans
(1,024,150)
(358,651)
Dividends paid
(1,000,000)
Net cash used in financing activities
(1,024,150)
(1,092,511)
Net decrease in cash and cash equivalents
(668,683)
(1,227,043)
Cash and cash equivalents at beginning of year
1,492,906
2,719,949
Cash and cash equivalents at end of year
824,223
1,492,906
KOKORO UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2024
- 15 -
1
Accounting policies
Company information
Kokoro UK Limited is a private company limited by shares incorporated in England and Wales. The registered office is First Floor 4 Lyon Road, Hersham, Walton-on-Thames, KT12 3PU.
1.1
Accounting convention
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.
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, modified to include the revaluation of freehold properties. The principal accounting policies adopted are set out below.
1.2
Going concern
Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
Revenue from sale of food and beverages over the counter or via Deliveroo is recognised on delivery of goods. This is when 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.
Revenue from the recharge of costs such as ingredients and packaging materials is recognised upon delivery of such products.
1.4
Research and development expenditure
Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated.
KOKORO UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
1
Accounting policies
(Continued)
- 16 -
1.5
Intangible fixed assets - goodwill
Goodwill represents the excess of the cost of acquisition of unincorporated businesses over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 10 years.
For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.
1.6
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Freehold land and buildings
Over 40 years
Leasehold land and buildings
Over 10-15 years
Plant and equipment
20% reducing balance
Fixtures and fittings
20% reducing balance
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 credited or charged to profit or loss.
1.7
Fixed asset investments
Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
1.8
Stocks
Stocks are stated at cost which comprises of raw material (ingredients), packaging, drinks and others.
At each reporting date, an assessment is made for impairment. Reversals of impairment losses are also recognised in profit or loss.
KOKORO UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
1
Accounting policies
(Continued)
- 17 -
1.9
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand and deposits held at cash with banks.
1.10
Financial instruments
Basic financial assets
Basic financial assets, which include debtors 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.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
Impairment of financial assets
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 profit or loss.
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 profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company 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.
Classification of financial liabilities
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 company after deducting all of its liabilities.
KOKORO UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
1
Accounting policies
(Continued)
- 18 -
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.11
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account 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 company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.12
Retirement benefits
The company operates a defined contribution pension scheme and the pension costs charged against profits represent the amount of the contributions payable to the scheme in respect of the accounting period.
1.13
Leases
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.
1.14
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
KOKORO UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
- 19 -
2
Turnover and other revenue
2024
2023
£
£
Turnover analysed by geographical market
United Kingdom
16,962,440
12,754,086
2024
2023
£
£
Other revenue
Interest income
27,197
38,851
Other operating income
26,311
383,517
3
Operating profit
2024
2023
Operating profit for the year is stated after charging/(crediting):
£
£
Research and development costs
3,000
-
Fees payable to the company's auditor for the audit of the company's financial statements
30,500
33,100
Depreciation of owned tangible fixed assets
559,560
377,618
Loss/(profit) on disposal of tangible fixed assets
1,510
(23,870)
Amortisation of intangible assets
46,600
13,850
Operating lease charges
801,907
719,191
4
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2024
2023
Number
Number
Management
19
17
Operations
261
224
Total
280
241
KOKORO UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
4
Employees
(Continued)
- 20 -
Their aggregate remuneration comprised:
2024
2023
£
£
Wages and salaries
4,900,936
3,890,508
Social security costs
367,324
288,193
Pension costs
67,163
51,083
5,335,423
4,229,784
5
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
150,006
210,000
Company pension contributions to defined contribution schemes
770
-
150,776
210,000
Remuneration disclosed above include the following amounts paid to the highest paid director:
2024
2023
£
£
Remuneration for qualifying services
n/a
120,000
As total directors' remuneration was less than £200,000 in the current year, no disclosure is provided for that year.
6
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
27,197
38,851
2024
2023
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
27,197
38,851
KOKORO UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
- 21 -
7
Interest payable and similar expenses
2024
2023
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
92,413
108,981
8
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
260,071
Deferred tax
Origination and reversal of timing differences
(8,483)
23,525
Total tax charge
251,588
23,525
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2024
2023
£
£
Profit before taxation
842,948
29,727
Expected tax charge based on the standard rate of corporation tax in the UK of 23.25% (2023: 21.50%)
195,985
6,391
Tax effect of expenses that are not deductible in determining taxable profit
18,586
Permanent capital allowances in excess of depreciation
28,534
17,134
Deferred tax
8,483
Taxation charge for the year
251,588
23,525
9
Dividends
2024
2023
£
£
Interim paid
1,000,000
KOKORO UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
- 22 -
10
Intangible fixed assets
£
Cost
At 1 September 2023
426,500
Additions
140,000
At 31 August 2024
566,500
Amortisation and impairment
At 1 September 2023
54,417
Amortisation charged for the year
46,600
At 31 August 2024
101,017
Carrying amount
At 31 August 2024
465,483
At 31 August 2023
372,083
11
Tangible fixed assets
Freehold land and buildings
Leasehold land and buildings
Plant and equipment
Fixtures and fittings
Total
£
£
£
£
£
Cost
At 1 September 2023
1,474,994
880,188
493,939
2,332,152
5,181,273
Additions
828,370
828,370
At 31 August 2024
1,474,994
880,188
493,939
3,160,522
6,009,643
Depreciation and impairment
At 1 September 2023
172,878
171,796
321,841
733,660
1,400,175
Depreciation charged in the year
31,000
72,967
34,419
421,174
559,560
At 31 August 2024
203,878
244,763
356,260
1,154,834
1,959,735
Carrying amount
At 31 August 2024
1,271,116
635,425
137,679
2,005,688
4,049,908
At 31 August 2023
1,302,116
708,392
172,098
1,598,492
3,781,098
KOKORO UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
- 23 -
12
Fixed asset investments
2024
2023
Notes
£
£
Investments in subsidiaries
13
1,510
Movements in fixed asset investments
Shares in subsidiaries
£
Cost or valuation
At 1 September 2023 & 31 August 2024
1,510
Impairment
At 1 September 2023
-
Disposals
1,510
At 31 August 2024
1,510
Carrying amount
At 31 August 2024
-
At 31 August 2023
1,510
13
Subsidiaries
Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Kokoro Plus Limited
11 Peascod Street, Windsor, SL4 1DT
Ordinary
51.00
14
Disposal of subsidiary
During the year, the company disposed of its 51% holding in Kokoro Plus Limited.
15
Stocks
2024
2023
£
£
Raw materials and consumables
103,999
177,682
Finished goods and goods for resale
86,906
82,906
190,905
260,588
KOKORO UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
- 24 -
16
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
187,998
99,160
Amounts owed by group undertakings
620,000
Other debtors
290,200
461,450
Prepayments and accrued income
328,012
501,899
1,426,210
1,062,509
17
Creditors: amounts falling due within one year
2024
2023
Notes
£
£
Bank loans
19
321,088
784,874
Trade creditors
554,367
526,022
Corporation tax
260,071
Other taxation and social security
702,070
570,666
Deferred income
21
158,093
134,966
Other creditors
97,558
38,446
Accruals and deferred income
641,445
716,196
2,734,692
2,771,170
18
Creditors: amounts falling due after more than one year
2024
2023
Notes
£
£
Bank loans and overdrafts
19
392,707
953,071
19
Loans and overdrafts
2024
2023
£
£
Bank loans
713,795
1,737,945
Payable within one year
321,088
784,874
Payable after one year
392,707
953,071
KOKORO UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
19
Loans and overdrafts
(Continued)
- 25 -
The long-term loans are secured by fixed and floating charges over all the assets and undertakings of Kokoro UK Ltd, including all present and future freehold and leasehold property, books and other debts, chattels, goodwill and uncalled share capital, both present and future.
The loans attract interest between 2.13% - 3.2% and the maturity date is between Aug 2023 - July 2037.
20
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2024
2023
Balances:
£
£
Accelerated capital allowances
301,704
310,187
2024
Movements in the year:
£
Liability at 1 September 2023
310,187
Credit to profit or loss
(8,483)
Liability at 31 August 2024
301,704
21
Deferred income
2024
2023
£
£
Other deferred income
158,093
134,966
22
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
67,163
51,083
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
KOKORO UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
- 26 -
23
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
100,000
100,000
100,000
100,000
24
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2024
2023
£
£
Within one year
2,751,712
1,669,209
Between two and five years
9,408,587
6,320,924
In over five years
6,448,510
10,238,733
18,608,809
18,228,866
25
Related party transactions
Transactions with related parties
At the year end, Mr R K Park was owed £11,650 (2023: £11,650) by the company and Mr E G Ko was owed £1,918 (2023: £1,944) by the company.
26
Ultimate controlling party
The company's ultimate parent is Asan Investments Ltd, a company incorporated in England and Wales.
The largest group which prepares consolidated accounts that include the company is Asan investment Ltd.
Copies of these consolidated statements are available from 27 Lyon Road, Walton-On-Thames, Surrey, England, KT12 3PU.
Mr Rak Kyu Park is regarded as the controlling related party by virtue of his directorship and majority shareholding in Asan Investments Limited.
KOKORO UK LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2024
- 27 -
27
Cash generated from operations
2024
2023
£
£
Profit for the year after tax
591,360
6,202
Adjustments for:
Taxation charged
251,588
23,525
Finance costs
92,413
108,981
Investment income
(27,197)
(38,851)
Loss/(gain) on disposal of tangible fixed assets
1,510
(23,870)
Amortisation and impairment of intangible assets
46,600
13,850
Depreciation and impairment of tangible fixed assets
559,560
377,618
Movements in working capital:
Decrease/(increase) in stocks
69,683
(209,047)
(Increase)/decrease in debtors
(363,701)
578,701
Increase in creditors
144,110
700,981
Increase in deferred income
23,127
46,293
Cash generated from operations
1,389,053
1,584,383
28
Analysis of changes in net funds/(debt)
1 September 2023
Cash flows
31 August 2024
£
£
£
Cash at bank and in hand
1,492,906
(668,683)
824,223
Borrowings excluding overdrafts
(1,737,945)
1,024,150
(713,795)
(245,039)
355,467
110,428
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