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Mornflake Oats Limited Registered number: 00893231 Annual report and financial statements For the year ended 31 July 2025
MORNFLAKE OATS LIMITED COMPANY INFORMATION
Directors | D W Baxter
| J E Lea
| A Meikle
| J J Lea
| M T Cookson
Company secretary | M T Cookson
Registered number | 00893231
Registered office | North Western Mills
| Gresty Road
| Crewe
| Cheshire
| CW2 6HP
Independent auditor | Forvis Mazars LLP
| Chartered Accountants & Statutory Auditor
| One St. Peter's Square
| Manchester
| M2 3DE
MORNFLAKE OATS LIMITED CONTENTS
| Page
Strategic Report | 1
Directors' Report | 2 - 4
Independent Auditor's Report | 5 - 8
Statement of Comprehensive Income | 9
Statement of Financial Position | 10
Statement of Changes in Equity | 11
Notes to the Financial Statements | 12 - 19
MORNFLAKE OATS LIMITED STRATEGIC REPORT FOR THE YEAR ENDED 31 JULY 2025
Introduction
The Directors present their Strategic Report for the year ended 31 July 2025. These financial statements represent the accounts of Mornflake Oats Limited.
Principal activity
The principal activity of the Company during the year was operating a food manufacturing facility.
Business review
The Directors are satisfied with the performance of the Company as reported in these financial statements. The Company continuously monitors the performance of its operations and other activities through regular reviews using the key performance indicators (KPI) as tools for measurement. The volatility of commodity markets remains an ongoing and critical issue. As in previous years, the current period was impacted by severe market forces and genuine shortages of certain comodities. Several advanced manufacturing initiatives have contributed to efficiency gains across various production and administrative processes. This has been key to mitigating the cotinued cost pressures experienced in key commodities and services.
Principal risks and uncertainties
The management of the risks referred to above has been a key strength this year and many of the policies that have been put in over the years such as the Oat Growing Scheme have continued to prove their worth.
Financial key performance indicators
The key performance indicators that the Company use are relevant to the type of business it operates in. The financial key performance indicators are specifically related to volumes, growth, turnover and balance sheet strength all of which are monitored on a continuous basis and the Directors remain satisfied with that performance.
Other key performance indicators
The other key performance indicators that the Company uses are operational (staff retention and motivational) and customer service (customer feedback, customer retention, and the attraction of new customers). These KPI indicators are within the targets set for the year. This report was approved by the board on 18 December 2025 and signed on its behalf.
J E Lea Director
- 1 -
MORNFLAKE OATS LIMITED DIRECTORS' REPORT FOR THE YEAR ENDED 31 JULY 2025 The Directors present their report and the financial statements for the year ended 31 July 2025.
Directors' responsibilities statement
The Directors are responsible for preparing the Strategic Report, the Directors' 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period. In preparing these financial statements, the Directors are required to: ∙select suitable accounting policies for the Company's financial statements and then apply them consistently; ∙make judgements and accounting estimates that are reasonable and prudent; and ∙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 to 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.
Results and dividends
The profit for the year, after taxation, amounted to £2,111,839 (2024 - £551,502). The Directors do not recommend the payment of a dividend (2024: £Nil).
Directors
The Directors who served during the year were:
D W Baxter
J E Lea
A Meikle
J J Lea
M T Cookson
- 2 -
MORNFLAKE OATS LIMITED DIRECTORS' REPORT (CONTINUED) FOR THE YEAR ENDED 31 JULY 2025
Going concern
The Directors have produced an extended forecast, 'the forecast' for the period to 31 December 2026. These forecasts are monitored monthly by the Board against actual trading performance. The Directors continue to monitor the impact of world events on various commodity prices however the long-term outlook remains uncertain. The Directors have also considered the impact of supply chain issues and inflationary pressures. The Directors are confident in the forecasts for the business in terms of ongoing demand, source of supply and productive ability and in the short and long term liquidity. The Directors are satisfied that a scenario that could result in the business not being a going concern are considered extremely remote. After making enquiries and considering the matters described above of more than 12 months post approval of the accounts, the Directors have reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. For these reasons, they continue to adopt the going concern basis in preparing the Directors' Report and financial statements.
Financial risk management
The Group that the Company is part of manages its risk to foreign currency fluctuations by the use of bank accounts in foreign currencies to match purchase and sales transactions. Exposure to risk on the supply and price of oats is, in the opinion of the Directors, managed at the Group level by the use of contracts with suppliers which are negotiated at the start of each growing season. Any oat requirements over contracted amounts, or in the event of an unexpected poor growing season, are purchased on the open market at market prices. The Company make sales on normal credit terms and manages the related risks through its normal credit control procedures. In the opinion of the Directors the exposure to such risks has been assessed and at present its deemed to be low and at an acceptable level for the Company to continue operating. The Company does not hedge interest payments on any of its borrowings or foreign currency transactions.
Other risks and uncertainties
The Directors believe that the Company's credit, liquidity and cash flow risks are mitigated by the Group's strong financial position.
Qualifying third party indemnity provisions
Throughout the year and up to the date of this report the Company maintained qualifying third party indemnity insurance for the Directors.
Disclosure of information to auditor
Each of the persons who are Directors at the time when this Directors' Report is approved has confirmed that: ∙so far as the Director is aware, there is no relevant audit information of which the Company's auditor is unaware, and ∙the Director has taken all the steps that ought to have been taken as a Director in order to be aware of any relevant audit information and to establish that the Company's auditor is aware of that information. - 3 -
MORNFLAKE OATS LIMITED DIRECTORS' REPORT (CONTINUED) FOR THE YEAR ENDED 31 JULY 2025
Auditor
The auditor, Forvis Mazars LLP, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006. This report was approved by the board on 18 December 2025 and signed on its behalf.
J E Lea Director
- 4 -
MORNFLAKE OATS LIMITED INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF MORNFLAKE OATS LIMITED Opinion We have audited the financial statements of Mornflake Oats Limited (the ‘Company’) for the year ended 31 July 2025 which comprise the Statement of Comprehensive Income, the Statement of Financial Position, the Statement of Changes in Equity and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 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 July 2025 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. Basis for opinion We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the "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. Other information 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. - 5 -
MORNFLAKE OATS LIMITED INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF MORNFLAKE OATS LIMITED 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 the 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 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. - 6 -
MORNFLAKE OATS LIMITED INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF MORNFLAKE OATS LIMITED Responsibilities of Directors As explained more fully in the Directors' Responsibilities Statement set out on page 2, 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 intend either to liquidate the Company or to cease operations, or have no realistic alternative but to do so. 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. Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. Based on our understanding of the Company and its industry, we considered that non-compliance with the following laws and regulations might have a material effect on the financial statements: employment regulation, health and safety regulation, and anti-money laundering regulation. To help us identify instances of non-compliance with these laws and regulations, and in identifying and assessing the risks of material misstatement in respect to non-compliance, our procedures included, but were not limited to: ∙Inquiring of management and, where appropriate, those charged with governance, as to whether the Company is in compliance with laws and regulations, and discussing their policies and procedures regarding compliance with laws and regulations; ∙Inspecting correspondence, if any, with relevant licensing or regulatory authorities; ∙Communicating identified laws and regulations to the engagement team and remaining alert to any indications of non-compliance throughout our audit; and ∙Considering the risk of acts by the Company which were contrary to applicable laws and regulations, including fraud. We also considered those laws and regulations that have a direct effect on the preparation of the financial statements, such as tax legislation, pension legislation, and the Companies Act 2006. - 7 -
MORNFLAKE OATS LIMITED INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF MORNFLAKE OATS LIMITED In addition, we evaluated the Directors' and 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 posting manual journal entries to manipulate financial performance, management bias through judgements and assumptions in significant accounting estimates, in particular in relation to revenue recognition (which we pinpointed to the cut-off assertion) and significant one-off or unusual transactions. Our audit procedures in relation to fraud included but were not limited to: ∙Making enquiries of the Directors and management on whether they had knowledge of any actual, suspected or alleged fraud; ∙Gaining an understanding of the internal controls established to mitigate risks related to fraud; ∙Discussing amongst the engagement team the risks of fraud; and ∙Addressing the risks of fraud through management override of controls by performing journal entry testing. There are inherent limitations in the audit procedures described above and the primary responsibility for the prevention and detection of irregularities including fraud rests with management. As with any audit, there remained a risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations or the override of internal controls. A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report. Use of the audit 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. Neil Barton (Senior Statutory Auditor) for and on behalf of Forvis Mazars LLP Chartered Accountants and Statutory Auditor One St. Peter's Square Manchester M2 3DE 18 December 2025 - 8 -
MORNFLAKE OATS LIMITED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 JULY 2025
| 2025 | 2024
Note | £ | £
Turnover |  | 48,508,667 | 58,842,288
Cost of sales |  | (42,681,192) | (55,178,152)
Gross profit |  | 5,827,475 | 3,664,136
Administrative expenses |  | (3,011,690) | (2,928,800)
Operating profit |  | 2,815,785 | 735,336
Tax on profit | 7 | (703,946) | (183,834)
Profit for the financial year |  | 2,111,839 | 551,502
There were no recognised gains and losses for 2025 or 2024 other than those included in the Statement of Comprehensive Income.
There was no other comprehensive income for 2025 (2024 - £NIL).
The notes on pages 12 to 19 form part of these financial statements.
- 9 -
MORNFLAKE OATS LIMITED REGISTERED NUMBER: 00893231 STATEMENT OF FINANCIAL POSITION AS AT 31 JULY 2025
|  | 2025 |  | 2024
Note |  | £ |  | £
Fixed assets |  |  |  |  |
Fixed asset investments | 8 |  | 25,000 |  | 25,000
|  |  | 25,000 |  | 25,000
Current assets |  |  |  |  |
Debtors: amounts falling due after more than one year | 9 | 5,716,182 |  | 7,845,864 |
Cash at bank and in hand | 10 | 500 |  | - |
|  | 5,716,682 |  | 7,845,864 |
Creditors: amounts falling due within one year | 11 | (1,135,196) |  | (431,077) |
Net current assets |  |  | 4,581,486 |  | 7,414,787
Creditors: amounts falling due after more than one year | 12 |  | - |  | (4,945,140)
Net assets |  |  | 4,606,486 |  | 2,494,647
Capital and reserves |  |  |  |  |
Called up share capital | 13 |  | 2 |  | 2
Profit and loss account | 14 |  | 4,606,484 |  | 2,494,645
|  |  | 4,606,486 |  | 2,494,647
The financial statements were approved and authorised for issue by the board and were signed on its behalf on 18 December 2025.
J E Lea
Director
The notes on pages 12 to 19 form part of these financial statements. - 10 -
MORNFLAKE OATS LIMITED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 JULY 2025
| Called up share capital | Profit and loss account | Total equity
| £ | £ | £
At 1 August 2023 | 2 | 1,943,143 | 1,943,145
Comprehensive income for the year |  |  |
Profit for the year | - | 551,502 | 551,502
Total comprehensive income for the year | - | 551,502 | 551,502
At 1 August 2024 | 2 | 2,494,645 | 2,494,647
Comprehensive income for the year |  |  |
Profit for the year | - | 2,111,839 | 2,111,839
Total comprehensive income for the year | - | 2,111,839 | 2,111,839
At 31 July 2025 | 2 | 4,606,484 | 4,606,486
| The notes on pages 12 to 19 form part of these financial statements.
- 11 -
MORNFLAKE OATS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025
1. | General information
Mornflake Oats Limited ("the Company") is a private limited Company, limited by shares and incorporated in England and Wales, registered number 00893231. The address of the registered office is North Western Mills, Gresty Road, Crewe, Cheshire, CW2 6HP. The principal activity of the Company during the year was operating a food manufacturing facility. 2.Accounting policies
| 2.1 | Basis of preparation of financial statements
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with 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 compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the Company's accounting policies (see note 3). These financial statements have been presented in pound sterling which is the functional currency of the Company, and rounded to the nearest £. The following principal accounting policies have been applied:
| 2.2 | Finanicial Reporting Standard 102 - reduced disclosure exemptions
The Company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland": • the requirements of Section 7 Statement of Cash Flows; • the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d); • the requirements of Section 11 Financial Instruments paragraphs 11.42, 11.44 to 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c); • the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.27, 12.29(a), 12.29(b) and 12.29A; • the requirements of Section 33 Related Party Disclosures paragraph 33.7. This information is included in the consolidated financial statements of Agri Food Holdings Limited as at 31 July 2025 and these financial statements may be obtained from Companies House, Crown Way, Cardiff, CF14 3UZ. - 12 -
MORNFLAKE OATS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025 2.Accounting policies (continued)
| 2.3 | Going concern
The Directors have produced an extended forecast, 'the forecast' for the period to 31 December 2026. These forecasts are monitored monthly by the Board against actual trading performance. The Directors continue to monitor the impact of world events on various commodity prices however the long-term outlook remains uncertain. The Directors have also considered the impact of supply chain issues and inflationary pressures. The Directors are confident in the forecasts for the business in terms of ongoing demand, source of supply and productive ability and in the short and long term liquidity. The Directors are satisfied that a scenario that could result in the business not being a going concern are considered extremely remote. After making enquiries and considering the matters described above of more than 12 months post approval of the accounts, the Directors have reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. For these reasons, they continue to adopt the going concern basis in preparing the Directors' Report and financial statements.
| 2.4 | Revenue
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised: Sale of goods Revenue from the sale of goods is recognised when all of the following conditions are satisfied: ∙the Company has transferred the significant risks and rewards of ownership to the buyer; ∙the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold; ∙the amount of revenue can be measured reliably; ∙it is probable that the Company will receive the consideration due under the transaction; and ∙the costs incurred or to be incurred in respect of the transaction can be measured reliably. Rendering of services Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied: ∙the amount of revenue can be measured reliably; ∙it is probable that the Company will receive the consideration due under the contract; ∙the stage of completion of the contract at the end of the reporting period can be measured reliably; and ∙the costs incurred and the costs to complete the contract can be measured reliably. - 13 -
MORNFLAKE OATS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025 2.Accounting policies (continued)
| 2.5 | Taxation
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 income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company operates and generates income.
| 2.6 | Valuation of investments
Investments in unlisted Company shares, whose market value can be reliably determined, are remeasured to market value at each reporting date. Gains and losses on remeasurement are recognised in the Statement of Comprehensive Income for the period. Where market value cannot be reliably determined, such investments are stated at historic cost less impairment.
| 2.7 | Debtors
Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
| 2.8 | Cash and cash equivalents
Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.
| 2.9 | Creditors
Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method. - 14 -
MORNFLAKE OATS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025 2.Accounting policies (continued)
| 2.10 | Financial instruments
The Company 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 Company's Statement of Financial Position when the Company becomes party to the contractual provisions of the instrument. Financial assets and liabilities are offset, with 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 Basic financial assets, which include trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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. Discounting is omitted where the effect of discounting is immaterial. The Company's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments. Impairment of financial assets Financial assets are assessed for indicators of impairment at each reporting date. Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate. If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss. Basic financial liabilities Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instruments any contract that evidences a residual interest in the assets of the Company after the deduction of all its liabilities. Basic financial liabilities, which include trade and other payables, bank loans and other loans are initially measured at their transaction price after transaction costs. When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. Discounting is omitted where the effect of discounting is immaterial. Debt instruments are subsequently carried at their amortised cost using the effective interest rate method. - 15 -
MORNFLAKE OATS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025 2.Accounting policies (continued)
| 2.10 | Financial instruments (continued)
Trade payables are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade payables are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial. Derecognition of financial instruments Derecognition of financial assets Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Company transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Company will continue to recognise the value of the portion of the risks and rewards retained. Derecognition of financial liabilities Financial liabilities are derecognised when the Company's contractual obligations expire or are discharged or cancelled.
3. | Judgements in applying accounting policies and key sources of estimation uncertainty
There are no significant judgements used in applying accounting policies of key sources of estimation uncertainty.
4. | Turnover
| All turnover arose within the United Kingdom.
5. | Auditor's remuneration
| During the year, the Company obtained the following services from the Company's auditor:
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Fees payable to the Company's auditor for the audit of the Company's financial statements | 3,675 | 3,500
- 16 -
MORNFLAKE OATS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025
6. | Employees
| The Company has no employees other than the Directors, who did not receive any remuneration (2024 - £NIL).
7. | Taxation
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Corporation tax |  |
| Current tax on profits for the year | 703,946 | 183,834
| Total current tax | 703,946 | 183,834
| Tax on profit | 703,946 | 183,834
| Factors affecting tax charge for the year
| The tax assessed for the year is the same as (2024 - the same as) the standard rate of corporation tax in the UK of 25% (2024 - 25%) as set out below:
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Profit on ordinary activities before tax | 2,815,785 | 735,336
| Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2024 - 25%) | 703,946 | 183,834
| Total tax charge for the year | 703,946 | 183,834
| Factors that may affect future tax charges
There were no factors that may affect future tax charges. - 17 -
MORNFLAKE OATS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025
8. | Fixed asset investments
|  | Unlisted investments
|  | £
| Cost |
| At 1 August 2024 | 25,000
| At 31 July 2025 | 25,000
9. | Debtors
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Due after more than one year |  |
| Amounts owed by group undertakings | 5,716,182 | 7,845,864
| Amounts owed by group undertakings are unsecured, interest free and not repayable for a period of at least twelve months from the date of signing these financial statements.
10. | Cash and cash equivalents
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Cash at bank and in hand | 500 | -
11. | Creditors: Amounts falling due within one year
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Amounts owed to group undertakings | 243,741 | -
| Corporation tax | 887,780 | 427,575
| Accruals and deferred income | 3,675 | 3,502
|  | 1,135,196 | 431,077
- 18 -
MORNFLAKE OATS LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2025
12. | Creditors: Amounts falling due after more than one year
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
| Amounts owed to group undertakings | - | 4,945,140
| Amounts owed to group undertakings are unsecured, interest free and not repayable for a period of at least twelve months from the date of signing these financial statements.
13. | Share capital
|  |  |  |  | 2025 | 2024
|  |  |  |  | £ | £
|  | Allotted, called up and fully paid |  |
|  | 2 (2024 - 2) Ordinary shares of £1.00 each | 2 | 2
14. | Reserves
Profit and loss account This reserve represents cumulative profits and losses less dividends declared.
15. | Related party transactions
| The Company has taken advantage of the exemption offered by Financial Reporting Standard 102 (Section 33) from the requirement to disclose transactions with other Group companies that are 100% owned.
16. | Controlling party
The immediate and ultimate Parent Company is Agri Food Holdings Limited, a company incorporated in England and Wales, with a registered address of North Western Mills, Crewe, Cheshire, CW2 6HP. The parent undertaking of the largest and smallest Group for which consolidated financial statements are prepared is Agri Food Holdings Limited. The Directors do not consider there to be an ultimate controlling party.
- 19 -