Ferguson Engineering (Northern) Limited - Accounts to registrar (filleted) - small 18.2

REGISTERED NUMBER: 02161479 (England and Wales)

FINANCIAL STATEMENTS

FOR THE YEAR ENDED 30TH SEPTEMBER 2019

FOR

FERGUSON ENGINEERING (NORTHERN) LIMITED

Page

Company Information

1

Balance Sheet

2

Notes to the Financial Statements

3

DIRECTORS:

Mr R Ferguson

Mr P Williams

Mr A Coulson

Mr B T Mattison

REGISTERED OFFICE:

2 Coulton Road

Lomeshaye Industrial Estate

Nelson

Lancashire

BB9 5ST

REGISTERED NUMBER:

02161479 (England and Wales)

AUDITORS:

Ainsworths Limited

Chartered Accountants

and Statutory Auditors

Charter House

Stansfield Street

Nelson

Lancashire

BB9 9XY

FIXED ASSETS

Tangible assets

4

376,883

159,466

CURRENT ASSETS

Stocks

971,462

231,399

Debtors

5

3,648,616

2,584,658

Cash at bank and in hand

908,128

479,086

5,528,206

3,295,143

CREDITORS

Amounts falling due within one year

6

5,679,111

3,062,416

NET CURRENT (LIABILITIES)/ASSETS

(150,905

)

232,727

TOTAL ASSETS LESS CURRENT LIABILITIES

225,978

392,193

CREDITORS

Amounts falling due after more than one year

7

(148,467

)

-

PROVISIONS FOR LIABILITIES

(43,072

)

(22,386

)

ACCRUALS AND DEFERRED INCOME

(735

)

(1,616

)

NET ASSETS

33,704

368,191

CAPITAL AND RESERVES

Called up share capital

100

100

Retained earnings

33,604

368,091

SHAREHOLDERS' FUNDS

33,704

368,191

The financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.

In accordance with Section 444 of the Companies Act 2006, the Income Statement has not been delivered.

The financial statements were approved by the Board of Directors on 6th December 2019 and were signed on its behalf by:

Mr R Ferguson - Director

1.	STATUTORY INFORMATION

Ferguson Engineering (Northern) Limited is a private company, limited by shares , registered in England and

Wales. The company's registered number and registered office address can be found on the Company

Information page.

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" including the provisions of Section 1A "Small Entities" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

The financial statements have been prepared on a going concern basis which assumes that the company will be

able to meet its liabilities as they fall due. The parent company, Ferguson Engineering (Holdings) Limited, have

confirmed their ongoing financial support of the company, including continued support of the company in its

cash flow requirements. Accordingly, the directors have concluded that it is appropriate for these financial

statements to be prepared on the going concern basis.

Related party exemption

The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The

Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party

transactions with wholly owned subsidiaries within the group.

The company's results are included within the consolidated financial statements of its ultimate parent company,

Ferguson Engineering (Holdings) Limited, whose registered office address is 2 Coulton Road, Lomeshaye

Industrial Estate, Nelson, BB9 5ST.

Significant judgements and estimates

The preparation of the financial statements requires management to make judgements, estimations and

assumptions that affect the amounts reported for assets and liabilities as at the balance sheet date and the

amounts reported for revenues and expenses during the year. However, the nature of estimation means that

actual outcomes could differ from those estimates. The following judgements (apart from those involving

estimates) have had the most significant effect on amounts recognised in the financial statements.

Contract stage of completion

Management make judgements at regular intervals as to whether revenue should be taken to the income

statement for contract work. When such revenues are recognised, costs are also transferred to the income

statement at the expected contract margin.

The following are the company's key sources of estimation uncertainty:

Expected contract margin

In order to determine the profit on its contracts in a particular period, management has to estimate costs to

complete on such contracts. In making these assessments there is a degree of inherent uncertainty. Management

have developed internal controls to assess and review carrying values and the appropriateness of the estimates

made.

If estimated future costs to complete are anticipated to exceed the contract invoice price, then a full provision is

made in the period in which such a loss is first foreseen.

Turnover

Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates,

value added tax and other sales taxes.

The company has two types of turnover, that of the manufacture and installation of industrial bakery equipment

and the servicing of equipment. Turnover will only be recognised when significant risks and rewards have passed

to the buyer, the amount of turnover can be measured reliably, it is probable that the economic benefits

associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect to the

transaction can be measured reliably.

Turnover from manufacture and installation of bakery equipment is usually recognised on commissioning of the

plant. Turnover from contracts in progress at the reporting period end will be by reference to the stage of

completion. Stage of completion is measured by reference to the labour hours incurred to date as a percentage of

total estimated labour hours for each contract.

Turnover from servicing of bakery equipment is recognised when the service has been provided.

Management charge income, is the recharge of shared factory overheads to other tenants of the factory. Turnover

is recognised on an accruals basis.

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.

Plant and machinery etc

-

25% on cost, 20% on cost, 10% on cost and 5% on cost

Stocks and work in progress

Stocks and work in progress are valued at the lower of cost and net realisable value, after making due allowance

for obsolete and slow moving items.

Cost of stocks is calculated using the average cost method and includes all purchase, transport, and handling

costs in bringing stocks to their present location and condition.

Contract work-in-progress is stated at cost plus attributable overheads, less provision for any known or

anticipated losses and progress payments receivable on account.

Progress payments are included under trade creditors to the extent that they exceed the related work-in-progress.

Financial instruments

Financial assets and financial liabilities are recognised when the company becomes a party to the contractual

provisions of the instrument.

Financial liabilities and equity instruments are classified according to the substance of the contractual

arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of

the company after deducting all of its liabilities.

All financial assets and liabilities are initially measured at transaction price (including transaction costs), except

for those financial assets classified as at fair value through profit and loss, which are initially measured at fair

value (which is normally the transaction price excluding transaction costs), unless the arrangement constitutes a

financing transaction. If an arrangement constitutes a financing transaction the financial asset or liability is

measured at the present value of the future payments discounted at a market rate of interest for a similar debt

instrument.

The following assets and liabilities are classified as financial instruments:

Investments in subsidiaries, trade debtors, trade creditors, hire purchase contracts, bank loans, directors' loans

and inter group balances.

Trade debtors, trade creditors, and directors' loans and inter group balances (being repayable on demand) are

measured at the undiscounted amount of cash or other consideration expected to be paid or received.

Hire purchase contracts and bank loans are initially measured at the present value of future payments, discounted

at a market rate of interest and subsequently at amortised cost using the effective interest method.

Financial assets are assessed at the end of each reporting period for objective evidence of impairment. If

objective evidence of impairment is found an impairment loss is recognised in profit and loss.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to

the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or

substantively enacted by the balance sheet date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance

sheet date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from

those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that

have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the

timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they

will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Research and development

Expenditure on research and development is written off in the year in which it is incurred.

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.

Hire purchase and leasing commitments

Assets obtained under hire purchase contracts or finance leases are capitalised in the balance sheet. Those held

under hire purchase contracts are depreciated over their estimated useful lives. Those held under finance leases

are depreciated over their estimated useful lives or the lease term, whichever is the shorter.

The interest element of these obligations is charged to profit or loss over the relevant period. The capital element

of the future payments is treated as a liability.

Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the

lease.

Pension costs and other post-retirement benefits

The company operates a defined contribution pension scheme. Contributions payable to the company's pension

scheme are charged to profit or loss in the period to which they relate.

Employee benefit trusts

The company has established trusts for the benefit of employees and certain of their dependents. Monies held in

these trusts are held by independent trustees and managed at their discretion.

3.	EMPLOYEES AND DIRECTORS

The average number of employees during the year was 66 (2018 - 59 ) .

4.	TANGIBLE FIXED ASSETS

Plant and

machinery

etc

£

COST

At 1st October 2018

972,849

Additions

315,747

Disposals

(159,346

)

At 30th September 2019

1,129,250

DEPRECIATION

At 1st October 2018

813,383

Charge for year

72,906

Eliminated on disposal

(133,922

)

At 30th September 2019

752,367

NET BOOK VALUE

At 30th September 2019

376,883

At 30th September 2018

159,466

Fixed assets, included in the above, which are held under hire purchase contracts are as follows:

Plant and

machinery

etc

£

COST

Additions

185,000

At 30th September 2019

185,000

DEPRECIATION

Charge for year

4,625

At 30th September 2019

4,625

NET BOOK VALUE

At 30th September 2019

180,375

5.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

30.9.19

30.9.18

£

£

Trade debtors

514,715

955,741

Amounts owed by group undertakings

895,137

1,396,374

Other debtors

2,238,764

232,543

3,648,616

2,584,658

6.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

30.9.19

30.9.18

£

£

Hire purchase contracts

33,300

-

Trade creditors

2,307,267

474,986

Amounts owed to group undertakings

2,361,690

1,987,978

Taxation and social security

78,644

280,458

Other creditors

898,210

318,994

5,679,111

3,062,416

7.

CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR

30.9.19

30.9.18

£

£

Hire purchase contracts

127,650

-

Other creditors

20,817

-

148,467

-

8.	DISCLOSURE UNDER SECTION 444(5B) OF THE COMPANIES ACT 2006

The Report of the Auditors was unqualified.

Ian Dugmore (Senior Statutory Auditor)

for and on behalf of Ainsworths Limited

9.	CONTINGENT LIABILITIES

Ferguson Engineering (Northern) Limited, its parent undertaking Ferguson Engineering (Holdings) Limited and

its fellow subsidiaries B.N.W Bakery Services Limited and Ferguson Laser Engineering Limited have guaranteed

each others liabilities to the bank. The aggregate amount of bank borrowings outstanding at 30th September

2019 was £Nil (2018: £Nil).

10.	DIRECTORS' ADVANCES, CREDITS AND GUARANTEES

The following advances and credits to a director subsisted during the years ended 30th September 2019 and

30th September 2018:

30.9.19

30.9.18

£

£

Mr R Ferguson

Balance outstanding at start of year

78,588

92,129

Amounts advanced

185,204

133,112

Amounts repaid

(158,566

)

(146,653

)

Amounts written off

-

-

Amounts waived

-

-

Balance outstanding at end of year

105,226

78,588

Directors loans are unsecured, interest free and are repayable on demand.

11.	RELATED PARTY DISCLOSURES

(i) During the prior year, the company wrote off loans amounting to £56,000 to a business in which the daughter

of R Ferguson, director of the company, is the sole proprietor.

As at 30th September 2019, the company was owed £Nil (2018: £Nil) by this related party.

(ii) During the year, A Ferguson whom is the son of R Ferguson, received loan advances.

As at 30th September 2019, the company was owed £400 (2018: £Nil) by this related party.

(iii) During the year, A Coulson whom is a director of the company, purchased an asset from the company for

£11,000.

As at 30th September 2019, the company was owed £Nil (2018: Nil) by this related party.