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Registered number: 10683736
CARLISLE FINE ART LIMITED
UNAUDITED
FINANCIAL STATEMENTS
INFORMATION FOR FILING WITH THE REGISTRAR
FOR THE YEAR ENDED 30 SEPTEMBER 2024
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CARLISLE FINE ART LIMITED
REGISTERED NUMBER: 10683736
BALANCE SHEET
AS AT 30 SEPTEMBER 2024
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Creditors: amounts falling due within one year
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The directors consider that the Company is entitled to exemption from audit under section 477 of the Companies Act 2006 and members have not required the Company to obtain an audit for the year in question in accordance with section 476 of the Companies Act 2006.
The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.
The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime and in accordance with the provisions of FRS 102 Section 1A - small entities.
The financial statements have been delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The Company has opted not to file the statement of income and retained earnings in accordance with provisions applicable to companies subject to the small companies' regime.
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 2 to 7 form part of these financial statements.
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CARLISLE FINE ART LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2024
Carlisle Fine Art Limited (the "Company") is a private company limited by share capital, incorporated under the UK Companies Act 2006 and domiciled in England. The address of the Company's registered office is 19 Coombehurst Close, Hadley Wood, Hertfordshire, England, EN4 0JU.
2.Accounting policies
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Summary of significant accounting policies
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The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all reporting periods presented, unless otherwise stated.
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Basis of preparation of financial statements
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The financial statements of the Company have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Section 1A of Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The preparation of financial statements in conformity with Financial Reporting Standard 102 requires the use of certain critical accounting estimates. It also requires management to exercise its judgment in the process of applying the Company's accounting policies.
Details of those estimates and/or judgments made in applying the Company's accounting policies towards the preparation of these financial statements that may be considered as yielding a significant risk of a material adjustment being made to the carrying amounts of assets and/or liabilities reported in the balance sheet during the next financial reporting period are disclosed in note 3 to the financial statements.
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Functional and presentational currency
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Items included in the financial statements of the Company are measured using the currency of the primary economic environment in which the Company operates (the "functional currency").
The functional currency of the Company and the currency in which the financial statements are presented (the "presentational currency") is 'Pounds Sterling' (£) rounded to the nearest single unit of currency.
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Foreign currency translation
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Foreign currencies are translated into the functional (and presentational) currency using the exchange rates prevailing at the date of the respective transaction or valuation where items are re-measured.
Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at financial period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss.
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CARLISLE FINE ART LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2024
2.Accounting policies (continued)
In assessing whether the going concern basis remains appropriate for the preparation of the financial statements, the directors have reviewed the Company’s principal and emerging risks, recent sales activity, existing loan facilities, access to funding and liquidity position and the Company's performance up to the date these financial statements were approved and expected performance over the 18 months following the balance sheet date.
The directors at the time of approving the financial statements have a reasonable expectation that the Company shall have, available at its disposal, adequate financial resources to continue in operational existence for the foreseeable future based on its financial performance to date and the board of directors of Guzon Limited, the Company's immediate parent undertaking and principal creditor, having confirmed in their professional capacity to the Company that their current and ongoing intention is for no demand of repayment of any amounts owed by the Company to Guzon Limited to be made until such time as the Company is able to repay them without detriment to its operational cash flow requirements.
While there will always remain an inherent uncertainty, the directors have no reason to believe that a material uncertainty exists that may cast significant doubt about the ability of the Company to continue as a going concern and therefore consider it both appropriate to continue to adopt the going concern basis in preparing the Company's financial statements and to not recognise any adjustments in the financial statements that would arise if the going concern basis were to become no longer appropriate.
Turnover comprises revenue recognised by the Company in respect of the sale of fine art and the recharge of restoration, framing and other costs in connection with fine art supplied during the year; with amounts recognised in full upon issue of an invoice at the time of agreement of sale and measured at the fair value of consideration receivable, excluding discounts, rebates, value added tax and other sales taxes.
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Current and deferred taxation
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Taxation comprises of income and/or corporate taxation ("current taxation") and deferred taxation recognised solely in profit or loss.
Current taxation is calculated using tax rates and on the basis of tax laws enacted or substantively enacted at the balance sheet date where taxable income is generated by the Company through its business operations.
The Company is subject to taxation at the rate enacted by HM Revenue & Customs in respect of fine art trading activities undertaken in the United Kingdom. All such liabilities in respect of UK current taxation payable are provided for as soon as there is a reasonable certainty that a liability will crystallise. The Company did not undertake any other activities in any other country.
Deferred taxation is recognised on temporary differences arising between the tax bases of assets and liabilities and their respective carrying amounts in the financial statements. Deferred taxation is calculated using tax rates and on the basis of tax laws enacted or substantively enacted at the balance sheet date expected to apply when the related deferred tax asset/liability is realised/settled. Deferred tax assets are recognised only to the extent that it is sufficiently probable that future taxable profits will be available against which the temporary differences can be utilised.
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CARLISLE FINE ART LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2024
2.Accounting policies (continued)
Stocks are stated at the lower of cost and net realisable value. At each balance sheet date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less any additional costs expected to be incurred in order to complete the sale with the overall difference (i.e. the impairment loss) recognised immediately in profit or loss.
Stocks that have been previously impaired are reviewed at each balance sheet date to assess whether there is any indication that the impairment losses recognised in prior financial reporting periods may no longer exist or may have decreased. The value of impairment reversed will be such that the resulting carrying amount is less than or equal to the value had no impairment been recognised in prior financial reporting periods.
The Company may hold and sell stocks on behalf of third parties where the related risks and rewards of ownership are not held by the Company. Such stocks are not included in the Company's balance sheet.
Certain stocks are held jointly with third parties. Such stocks are included in the balance sheet at the value of the Company's share. Where such jointly held stocks are sold by the Company, the Company reflects the sale in profit or loss as if the item sold was held 100% by the Company with a corresponding charge in cost of sales to reflect the share of turnover and stock value in respect of third party holdings.
The Company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities; with said financial assets and liabilities classified in accordance with the substance of the underlying contractual obligations rather than its legal form.
Financial assets and liabilities are recognised upon becoming party to the contractual provisions of the instrument. Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or the financial asset is transferred along with substantially all the risks and rewards of ownership of the asset to another party. Financial liabilities are derecognised only when the underlying obligations are discharged, cancelled or expired.
The measurement of specific financial assets, financial liabilities and equity held by the Company is as outlined in notes 2.10 to 2.13 of the financial statements.
Debtors, excluding deferred taxation (see note 2.7), are initially measured at transaction price (i.e. fair value) and subsequently held, at transaction price less provision for impairment.
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Cash and cash equivalents
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Cash balances are reported by the Company as being financial instruments classified as short term receivables and are represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours and subject to an insignificant risk of changes in value. Cash balances are held at floating interest rates linked to UK bank rates.
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CARLISLE FINE ART LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2024
2.Accounting policies (continued)
Creditors are initially measured and subsequently held at transaction price.
Other loans, comprising of shareholder loans, are non-interest bearing and repayable upon the Company holding cash reserves in excess of its working capital requirements; the date of which is currently indeterminable. For this reason, said loans are initially measured and subsequently held at transaction price and as falling due within one year.
Ordinary share capital, shown in equity, is initially measured and subsequently held at its nominal value. Where the transaction price for issued shares exceeds their nominal value, the difference is shown under equity in a share premium account with any directly attributable transaction costs associated with the issuing of said shares deducted from a share premium account.
Equity dividends are recognised in the reporting period upon approval by the Company's directors.
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Judgments in applying accounting policies and key sources of estimation uncertainty
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In the application of the Company's accounting policies, the directors are required to make judgments, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. Although the expected outcome of said estimates and assumptions will, by definition, seldom equal the related actual results; estimates and judgments made are continually reevaluated and are based on historical experience as well as other factors, including expectations of future events that are believed to be reasonable under the circumstances.
Estimates and underlying assumptions are reviewed on an ongoing basis with revisions recognised in the period in which the estimates and/or assumptions are revised and in any future periods affected.
The judgments, estimates and assumptions that are considered as having a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial period are addressed below:
Valuation of stocks
The Company carries art stocks at the lower of cost and net realisable value.
The valuation of art stocks involves the application, and therefore significant judgment, of unobservable inputs, estimates and assumptions. In determining the net realisable value, the directors are required to use their judgment, experience, available market evidence and guidance from knowledgeable third party professionals, where considered necessary, in assessing any impairment provisions that may be required.
Key estimates and assumptions considered on valuation of art stocks include the likelihood of future sale and expected proceeds on sale, market evidence on comparable transactions for similar pieces of art, current market and investor expectations, the nature and condition of the specific piece of art and consideration of hypothetical sellers and buyers, who are reasonably informed and motivated, but not compelled, to transact on an arm’s length basis.
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CARLISLE FINE ART LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2024
3.Judgments in applying accounting policies (continued)
Recoverability of trade and other receivables
When assessing the recoverable value of trade receivables, the directors consider a variety of factors including the ageing profile of the debt, historical and market experience with the customer and the quality of communications to date with the debtor. There exists a degree of estimation uncertainty when determining the aforementioned and whilst every attempt is made by the directors to ensure accuracy, there will always remain an inherent risk that the recognised estimated value at the balance sheet date does not match the final future realised value.
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The average monthly number of employees, including directors, during the year was 4 (2023 - 4).
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Works of fine art for resale
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At the balance sheet date, the carrying amount of stock impairments was £nil (2023: £nil).
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Prepayments and accrued income
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Other debtors are non-interest bearing and, in the opinion of the directors, of a fair value not materially different from their carrying value.
At the balance sheet date, the provision for impairment against debtors falling due within one year was £nil (2023: £nil).
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Cash and cash equivalents
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CARLISLE FINE ART LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2024
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Creditors: Amounts falling due within one year
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Other taxation and social security
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Accruals and deferred income
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Other loans payable are unsecured, non-interest bearing and repayable on demand with no fixed date of repayment.
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The Company held no financial instruments that would require specific disclosure under sections 11 or 12 of Financial Reporting Standard 102 and paragraph 36 of Schedule 1 to the Companies Act 2006.
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Related party transactions
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Group undertakings
The Company has taken advantage of exemptions provided by Section 33 of Financial Reporting Standard 102 from the requirement to disclose transactions undertaken or balances carried forward as at the balance sheet date between the Company and its fellow wholly-owned group undertakings.
Other related parties
During the reporting period, consultancy fees totalling £200,000 (2023: £200,000) were payable by the Company to TGFA Advisory Services; an unincorporated trade under the control of the father of certain directors of the Company. At the balance sheet date and included in creditors falling due within one year, TGFA Advisory Services was owed £140,000 (2023: £120,000) by the Company.
There were no further related party transactions and/or period end balances to report in accordance with Section 1A of Financial Reporting Standard 102 or the UK Companies Act 2006 as part of these financial statements.
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The Company's immediate parent undertaking is Guzon Limited, a private company incorporated and registered in the British Virgin Islands which holds a 100% interest in the total voting rights of the Company.
Guzon Limited, whose registered office is at Akara Building, 24 de Castro Street, Wickhams Cay I, Road Town, Tortola, British Virgin Islands, is the parent undertaking of the smallest group to consolidate these financial statements.
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