Kiltane Retail Limited - Limited company accounts 18.2

REGISTERED NUMBER: SC175001

KILTANE RETAIL LIMITED

STRATEGIC REPORT, REPORT OF THE DIRECTORS AND

AUDITED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2018

Page

Strategic Report

1

Report of the Directors

2

Report of the Independent Auditors

4

Profit and Loss Account

6

Other Comprehensive Income

7

Balance Sheet

8

Statement of Changes in Equity

9

Cash Flow Statement

10

Notes to the Cash Flow Statement

11

Notes to the Financial Statements

12

The directors present their strategic report for the year ended 31 December 2018.

REVIEW OF BUSINESS

The results for the year and financial position of the company are as shown in the annexed financial statements. This

Strategic Report is only part of the company's annual accounts and reports. A person entitled to a full copy of the annual

accounts and reports can obtain them by writing to the company's registered office at Caledonia House, 89 Seaward

Street, Glasgow, G41 1HJ.

The auditor's opinion on the financial statements (given on page 4) was unqualified. The auditor's opinion on the

consistency between the accounts and the Strategic Report and Directors' Report was also unqualified.

We aim to present a balanced and comprehensive review of the development and performance of our business during the

year and its position at the year end. Our review is consistent with the size and nature of our business and is written in

the context of the risks and uncertainties we face.

Our key financial performance indicators are those that communicate the financial performance and strength of the

company as a whole. They are turnover and net assets.

Turnover increased from £13,226,622 for the year to 31 December 2017 to £14,207,705 for the year to 31 December

2018. Net assets at 31 December 2018 have risen to £10,468,823 from £7,963,261 at 31 December 2017.

PRINCIPAL RISKS AND UNCERTAINTIES

The directors have not identified specific risks and uncertainties but overall they will continue to monitor costs and

performance, seeking further efficiency gains wherever possible. All costs are controlled by careful planning and

budgeting and continuing ongoing review to ensure efficiency. The only potential note of caution the directors would

add is regarding the implications of the UK leaving the European Union, as the customer base spans tourists from all

over the world. However, the directors are satisfied the company is in a position to adequately address and respond to

any such implications.

ON BEHALF OF THE BOARD:

J M Keane - Director

23 May 2019

The directors present their report with the financial statements of the company for the year ended 31 December 2018.

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was the retail of tourist gifts and souvenirs.

DIVIDENDS

The total distribution of dividends for the year ended 31 December 2018 will be £163,263.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 January 2018 to the date of this

report.

J M Keane

J S Keane

Mrs K Keane

FINANCIAL INSTRUMENTS

The directors do not believe that the company is exposed to any risks that are sufficient to require the use of financial

instruments.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Strategic Report, the Report of the Directors and the financial statements

in accordance with applicable laws 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 the affairs of

the company and of the profit and 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;

- state whether applicable accounting standards have been followed subject to any material departures disclosed and

explained in the financial statements;

- 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 AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act

2006) of which the company's auditors are unaware, and each director has taken all the steps that he or she ought to have

taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the

company's auditors are aware of that information.

ON BEHALF OF THE BOARD:

J M Keane - Director

23 May 2019

Opinion

We have audited the financial statements of Kiltane Retail Limited (the 'company') for the year ended

31 December 2018 which comprise the Profit and Loss Account, Other Comprehensive Income, Balance Sheet,

Statement of Changes in Equity, Cash Flow Statement and Notes to the Cash Flow Statement, 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 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 December 2018 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 Auditors' 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

We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to

you where:

-	the directors' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or

-

the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the company's ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.

Other information

The directors are responsible for the other information. The other information comprises the information in the Strategic

Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors

thereon.

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.

In connection with our audit of the financial statements, 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 audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or

apparent material misstatements, we are required to determine whether there is a material misstatement in the financial

statements or a material misstatement of the other information. 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.

Opinion 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 Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Strategic Report and the Report of the Directors 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 Report of the Directors.

We have nothing to report in respect of the following matters where 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 Statement of Directors' Responsibilities set out on page two, 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 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.

Auditors' 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 a Report of the Auditors 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.

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 Report of the Auditors.

Use of our 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 a Report of the Auditors 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.

Jayne F Clifford MA CA (Senior Statutory Auditor)

for and on behalf of Martin Aitken & Co Ltd

Statutory Auditor

Chartered Accountants

Caledonia House

89 Seaward Street

Glasgow

G41 1HJ

23 May 2019

TURNOVER

14,207,705

13,226,622

Cost of sales

6,261,109

7,152,205

GROSS PROFIT

7,946,596

6,074,417

Administrative expenses

5,899,808

4,760,898

2,046,788

1,313,519

Other operating income

324,705

397,107

OPERATING PROFIT

4

2,371,493

1,710,626

Interest receivable and similar income

1,457

221

2,372,950

1,710,847

Interest payable and similar expenses

5

121,117

67,161

PROFIT BEFORE TAXATION

2,251,833

1,643,686

Tax on profit

6

484,269

364,944

PROFIT FOR THE FINANCIAL YEAR

1,767,564

1,278,742

PROFIT FOR THE YEAR

1,767,564

1,278,742

OTHER COMPREHENSIVE INCOME

Revalued heritable property

1,090,020

903,000

Income tax relating to other comprehensive income

(188,759

)

(82,302

)

OTHER COMPREHENSIVE INCOME FOR THE YEAR, NET OF INCOME TAX

901,261

820,698

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

2,668,825

2,099,440

FIXED ASSETS

Intangible assets

8

507,000

663,000

Tangible assets

9

8,200,753

4,412,686

8,707,753

5,075,686

CURRENT ASSETS

Stocks

10

5,459,783

6,178,237

Debtors

11

1,755,391

2,098,893

Cash at bank and in hand

1,304,662

44,796

8,519,836

8,321,926

CREDITORS

Amounts falling due within one year

12

2,698,830

3,700,972

NET CURRENT ASSETS

5,821,006

4,620,954

TOTAL ASSETS LESS CURRENT LIABILITIES

14,528,759

9,696,640

CREDITORS

Amounts falling due after more than one year

13

(3,366,142

)

(1,212,572

)

PROVISIONS FOR LIABILITIES

17

(693,794

)

(520,807

)

NET ASSETS

10,468,823

7,963,261

CAPITAL AND RESERVES

Called up share capital

18

400,000

400,000

Capital redemption reserve

19

40,000

40,000

Retained earnings

19

10,028,823

7,523,261

SHAREHOLDERS' FUNDS

10,468,823

7,963,261

The financial statements were approved by the Board of Directors on 23 May 2019 and were signed on its behalf by:

J M Keane - Director

Called up

Capital

share

Retained

redemption

Total

capital

earnings

reserve

equity

£

£

£

£

Balance at 1 January 2017

400,000

5,551,874

40,000

5,991,874

Changes in equity

Dividends

-

(128,053

)

-

(128,053

)

Total comprehensive income

-

2,099,440

-

2,099,440

Balance at 31 December 2017

400,000

7,523,261

40,000

7,963,261

Changes in equity

Dividends

-

(163,263

)

-

(163,263

)

Total comprehensive income

-

2,668,825

-

2,668,825

Balance at 31 December 2018

400,000

10,028,823

40,000

10,468,823

Cash flows from operating activities

Cash generated from operations

1

3,485,256

37,952

Interest paid

(121,204

)

(66,710

)

Interest element of hire purchase payments paid

87

(451

)

Tax paid

(409,394

)

(284,072

)

Net cash from operating activities

2,954,745

(313,281

)

Cash flows from investing activities

Purchase of intangible fixed assets

-

(780,000

)

Purchase of property plant and equipment

(3,183,481

)

(574,364

)

Loans provided to related parties

-

(1,041,304

)

Loans repaid from related parties

595,244

10,000

Loans received from related parties

-

44,286

Lease premium paid

(55,000

)

(290,000

)

Interest received

1,457

221

Net cash from investing activities

(2,641,780

)

(2,631,161

)

Cash flows from financing activities

New loans in year

3,812,500

1,000,000

Loan repayments in year

(1,630,085

)

(239,317

)

New hire purchase contract in year

15,000

-

Capital repayments in year

(5,201

)

(3,466

)

Amount introduced by directors

110,000

84,722

Amount withdrawn by directors

(49,415

)

(130,070

)

Equity dividends paid

(163,263

)

(128,053

)

Net cash from financing activities

2,089,536

583,816

Increase/(decrease) in cash and cash equivalents

2,402,501

(2,360,626

)

Cash and cash equivalents at beginning of year

2

(1,097,839

)

1,262,787

Cash and cash equivalents at end of year

2

1,304,662

(1,097,839

)

1.	RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

2018

2017

£

£

Profit before taxation

2,251,833

1,643,686

Depreciation charges

626,819

520,462

Loss on disposal of fixed assets

14,615

-

Lease premium released

41,435

30,433

Finance costs

121,117

67,161

Finance income

(1,457

)

(221

)

3,054,362

2,261,521

Decrease/(increase) in stocks

718,454

(2,938,260

)

Increase in trade and other debtors

(296,305

)

(199,649

)

Increase in trade and other creditors

8,745

914,340

Cash generated from operations

3,485,256

37,952

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these

Balance Sheet amounts:

Year ended 31 December 2018

31/12/18

1/1/18

£

£

Cash and cash equivalents

1,304,662

44,796

Bank overdrafts

-

(1,142,635

)

1,304,662

(1,097,839

)

Year ended 31 December 2017

31/12/17

1/1/17

£

£

Cash and cash equivalents

44,796

1,262,787

Bank overdrafts

(1,142,635

)

-

(1,097,839

)

1,262,787

1.	STATUTORY INFORMATION

Kiltane Retail Limited is a private company incorporated in Scotland. The registered office is Caledonia House,

89 Seaward Street, Glasgow, G41 1HJ.

The financial statements are presented in Sterling (£).

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

The financial statements have been prepared in accordance with Financial Reporting Standard 102 "The

Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006.

Assets and liabilities are initially recognised at historical cost or transaction value unless otherwise stated in the

relevant accounting policy.

Going concern

After reviewing the company's financial position and forecasts, the directors have a reasonable expectation that

the company has adequate resources to continue in operational existence for the foreseeable future. The company

therefore continues to adopt the going concern basis in preparing its financial statements.

Critical accounting judgements and key sources of estimation uncertainty

In the application of the company's accounting policies the directors are required to make judgements, estimates

and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other

sources. The estimates and associated assumptions are based on historical experience and other factors that are

considered to be relevant. Actual results may differ from these estimates. The estimates and underlying

assumptions are reviewed on an ongoing basis.

Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision

affects only that period, or in the period of the revision and future periods if the revision affects both current and

future periods.

Turnover

Turnover represents net invoiced sales of goods, excluding value added tax. The company's policy is to

recognise a sale when substantively all risks and rewards in connection with the goods have been passed to the

buyer.

Goodwill

Positive purchased goodwill arising on acquisitions is capitalised, classified as an asset on the balance sheet and

amortised over its estimated useful life up to a maximum of 20 years. This length of time is presumed to be the

maximum useful life of purchased goodwill because it is difficult to make projections beyond this period.

Goodwill is reviewed for impairment at the end of the first full financial year following each acquisition and

subsequently, as and when necessary, if circumstances emerge that indicate that the carrying value may not be

recoverable.

Intangible assets

Intangible assets are measured at cost. After initial recognition, intangible assets are measured at cost less any

accumulated amortisation and any accumulated impairment losses.

Intellectual property is being amortised evenly over its estimated useful life of five years.

Amortisation is included in administrative expenses in the profit and loss account.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life or, if held under a finance lease, over the lease term, whichever is the shorter.

Heritable property

-

2% straight line

Leasehold improvements

-

10% on cost

Property improvements

-

10% on cost

Fixtures & equipment

-

20% on cost

Motor vehicles

-

25% on reducing balance

Computer equipment

-

50% on cost and 20% on cost

Plant and equipment are included in the financial statements at cost less depreciation.

At each balance sheet date the directors review the carrying amounts of plant and equipment to determine

whether there is any indication that any items have suffered impairment loss and that if any such indication

exists, the recoverable amount of an asset is estimated in order to determine the extent of the impairment loss, if

any. Where it is not possible to estimate the recoverable amount of the asset, the directors estimate the

recoverable amount of the cash-generating unit to which the asset belongs.

Heritable property is carried at its revalued amounts, being fair value at the date of valuation less any subsequent

depreciation and impairment losses. Revaluations are performed by professionally qualified valuers with

sufficient regularity to ensure that the carrying amounts do not differ materially from those that would be

determined using fair values. Any accumulated depreciation at the date of revaluation is eliminated against the

gross carrying amount of the asset and the net amount is restated to the revalued amount of the asset.

Any revaluation increase in the carrying amount of heritable property is recognised in other comprehensive

income and included in a non-distributable reserve in equity, except to the extent that it reverses a revaluation

decrease of the same asset previously recognised in the profit or loss, in which case the increase is credited to the

profit and loss to the extent of the decrease previously expended. Decreases that offset previous increases of the

same asset are charged in other comprehensive income and debited against the non-distributable reserve in

equity: decreases exceeding the balance in non-distributable reserve relating to an asset are recognised in the

profit and loss. Each year the difference between depreciation based on the revalued carrying amount of the

asset recognised in profit or loss and depreciation based on the asset's original cost is transferred from

non-distributable reserve to retained earnings.

Tangible fixed assets are only capitalised if their value is above £1,000.

Stocks

Stock has been valued at the lower of cost and estimated selling price less costs to sell. Stock is recognised as an

expense in the period in which the related revenue is recognised.

Tax

Current tax is recognised at the amount of tax payable in respect of the taxable profit for the current or past

reporting periods using the tax rates and laws that have been enacted or substantively enacted at the balance

sheet date.

The charge for taxation takes into account taxation deferred as a result of timing differences between the

treatment of certain items for taxation and accounting purposes. In general, deferred taxation is recognised in

respect of all timing differences that have originated but not reversed at the balance sheet date. However,

deferred tax assets are recognised only to the extent that the directors consider that it is more likely than not that

there will be suitable taxable profits from which the future reversal of the underlying timing differences can be

deducted. Deferred taxation is measured on a non-discounted basis at the tax rates that are expected to apply in

the periods in which the timing differences reverse, based on tax rates and laws enacted or substantively enacted

at the balance sheet date.

With the exception of changes arising on the initial recognition of a business combination, the tax expense is

presented either in profit or loss, other comprehensive income or statement of changes in equity depending on

the transaction that resulted in the tax expense.

Deferred tax liabilities are presented within provisions for liabilities and deferred tax assets within debtors.

Foreign currencies

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the

balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at

the date of transaction. Exchange differences are taken into account in arriving at the operating result.

Pension costs and other post-retirement benefits

The company operates a defined contribution pension scheme and the pension charge represents the amounts

payable by the company to the fund in respect of the period. Contributions payable for the year are charged in

the profit and loss account.

Operating lease commitments

Rentals paid and received and lease premiums paid applicable to operating leases where substantially all of the

benefits and risks of ownership remain with the lessor, are charged against or credited to profits on a straight line

basis over the period of the lease.

Hire purchase commitments

Assets held under hire purchase agreements are capitalised and disclosed under tangible fixed assets at their fair

value. The capital element of the future payments is treated as a liability and the interest is charged to the profit

and loss account on a straight line basis.

Financial instruments

The company only has financial assets and liabilities of a kind that qualify as basic financial instruments. Basic

financial instruments are initially recognised at transaction value and subsequently measured at their settlement

value.

Debtors

Short term debtors are measured at transaction price, less any impairment.

Creditors

Short term trade 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.

3.	EMPLOYEES AND DIRECTORS

2018

2017

£

£

Wages and salaries

2,473,125

1,896,047

Social security costs

183,680

129,459

Other pension costs

81,385

98,712

2,738,190

2,124,218

The average number of employees during the year was as follows:

2018

2017

Sales and trading

126

108

Warehouse and administration

22

20

148

128

2018

2017

£

£

Directors' remuneration

54,005

55,248

Directors' pension contributions to money purchase schemes

50,636

90,000

The number of directors to whom retirement benefits were accruing was as follows:

Money purchase schemes

2

1

4.	OPERATING PROFIT

The operating profit is stated after charging:

2018

2017

£

£

Depreciation - owned assets

466,610

391,331

Depreciation - assets on hire purchase contracts

4,209

3,327

Loss on disposal of fixed assets

14,615

-

Goodwill amortisation

-

8,804

Intellectual property amortisation

156,000

117,000

Auditors' remuneration

24,500

18,000

Auditors' remuneration for non audit work

13,605

12,688

Foreign exchange differences

84

56,394

5.

INTEREST PAYABLE AND SIMILAR EXPENSES

2018

2017

£

£

Bank overdraft interest

12,594

21,213

Bank term loan interest

108,610

45,497

Hire purchase

(87

)

451

121,117

67,161