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Registered number: 03784639
MERCHANT CITY LIMITED
UNAUDITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
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CONTENTS
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Notes to the financial statements
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MERCHANT CITY LIMITED
REGISTERED NUMBER:03784639
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BALANCE SHEET
AS AT 31 MARCH 2025
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Creditors: amounts falling due after more than one year
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Provisions for liabilities
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Non-distributable profit and loss reserve
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1
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MERCHANT CITY LIMITED
REGISTERED NUMBER:03784639
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BALANCE SHEET (CONTINUED)
AS AT 31 MARCH 2025
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 profit and loss account 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:
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G A Lee
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The notes on pages 3 to 9 form part of these financial statements.
2
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
The company is a private company, limited by shares and is registered in England and Wales. Theaddress of its registered office and principal place of business is Grove Lodge, 287 Regents Park Road, London, N3 3JY.
Merchant City Limited is principally engaged in property investment. The directors are actively seeking opportunities to invest in properties.
2.Accounting policies
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Basis of preparation of financial statements
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The financial statements 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 company is the parent undertaking of a small group and as such is not required by the Companies Act 2006 to prepare group accounts. These financial statements therefore present information about the company as an individual undertaking and not about its group.
The company's functional and presentational currency is pound sterling.
The following principal accounting policies have been applied:
The parent companies have committed to continue to provide necessary funding in order for the company to maintain operations and meet liabilities in full for at least the next 12 months. On this basis, the directors are satisfied that the financial statements should be prepared on a going concern basis.
Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.
All borrowing costs are recognised in profit or loss in the year in which they are incurred.
3
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
2.Accounting policies (continued)
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Current and deferred taxation
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The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
The current corporate tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the company operates and generates income.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:
∙The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
∙Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.
Deferred tax balances are not recognised in respect of permanent differences. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
Investment property is carried at fair value determined annually by directors or external valuers and derived from the current market rents and investment property yields for comparable real estate, adjusted if necessary for any difference in the nature, location or condition of the specific asset. No depreciation is provided. Changes in fair value are recognised in the profit and loss account.
Investments in subsidiaries are measured at cost less accumulated impairment.
4
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
2.Accounting policies (continued)
Short-term debtors are measured at transaction price, less any impairment.
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Cash and cash equivalents
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Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours.
Short-term creditors are measured at the transaction price.
The company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to and from related parties and investments in ordinary shares.
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The average monthly number of employees, including directors, during the year was 3 (2024 - 6).
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Included within the net book value is £43,689 (2024 – £59,739) relating to assets held under hire purchase agreement.
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5
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
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Investments in subsidiary companies
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Freehold investment property
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The 2025 valuations were made by the directors, on an open market value for existing use basis.
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If the investment properties had been accounted for under the historic cost accounting rules, the properties would have been measured as follows:
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6
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
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Amounts owed by group undertakings
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Cash and cash equivalents
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Creditors: Amounts falling due within one year
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Amounts owed to group undertakings
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Other taxation and social security
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Obligations under finance lease and hire purchase contracts
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Accruals & deferred income
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The loan is secured by a fixed charge over the investment property of the company.
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Creditors: Amounts falling due after more than one year
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Net obligations under finance leases and hire purchase contracts
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The bank loan is secured by a fixed charge over the investment property of the company.
At 31 March 2025, there are intercompany unlimited cross guarantees between the following companies, of which G A Lee is a director:
Kerrington Limited and Merchant City Limited.
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7
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
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Analysis of the maturity of loans is given below:
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Amounts falling due after more than 5 years
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Hire purchase and finance leases
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Minimum lease payments under hire purchase fall due as follows:
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Charged to profit or loss
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The provision for deferred taxation is made up as follows:
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Accelerated capital allowances
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Capital gains timing difference
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8
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
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Allotted, called up and fully paid
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2 ordinary shares of £1 each
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There is one class of share. There are no restrictions on the distribution of dividends and the repayment of capital.
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Related party transactions
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At the year end, the company owed £1,312,999 (2024 - £3,312,999) to A.R. & V. Investments Limited, a 50% shareholder. The loan is interest free and repayable on demand.
During the year, the company paid £2,182,480 (2024 - £627,197 received from) to Kerrington Limited, a 50% shareholder. At the year end, the company owed £2,314,582 (2024 - £4,497,062) to Kerrington Limited. The loan is interest free and repayable on demand.
At the year end, the company owed £706,347 (2024 - £746,4990) to G A Lee, a director of the company. The loan is interest free and repayable on demand.
At the year end, the company owed £885,214 (2024 - £885,214) to E Azouz, a director of the company. The loan is interest free and repayable on demand.
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9
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