Rackham Group Ltd - Limited company accounts 20.1

REGISTERED NUMBER: 05388109 (England and Wales)

Directors' Report and

Audited Consolidated Financial Statements

for the Year Ended 31 December 2019

for

Rackham Group Ltd

Page

Company Information

1

Directors' Report

2

Report of the Independent Auditors

4

Consolidated Income Statement

6

Consolidated Balance Sheet

7

Company Balance Sheet

9

Consolidated Statement of Changes in Equity

10

Company Statement of Changes in Equity

11

Notes to the Consolidated Financial Statements

12

DIRECTORS:

P A Rackham

S A Rackham

S R Stuteley

P A Rackham Jnr

J Williams

SECRETARY:

S R Stuteley

REGISTERED OFFICE:

Manor Farm

122 The Street

Bridgham

Norwich

Norfolk

NR16 2RX

REGISTERED NUMBER:

05388109 (England and Wales)

INDEPENDENT AUDITORS:

Knights Lowe Limited

Eldo House

Kempson Way

Suffolk Business Park

Bury St Edmunds

Suffolk

IP32 7AR

The directors present their report with the financial statements of the company and the group for the year ended

31 December 2019.

PRINCIPAL ACTIVITIES

The principal activities of the group in the year under review were those of agriculture, property investment and

property dealing and development.

DIVIDENDS

Interim dividends were paid during the year on each class of share at different rates as follows:

Share class

Amount per share

"A"

£18.349

"B"

£4.070

"C"

£5.215

"D"

£4.581

In aggregate the amount paid during the year was £872,043 (2018: £1,274,158).

The directors do not propose a final dividend. (2018: nil).

DIRECTORS

The directors shown below have held office during the whole of the period from 1 January 2019 to the date of this

report.

P A Rackham

S A Rackham

S R Stuteley

P A Rackham Jnr

J Williams

DIRECTORS' RESPONSIBILITIES STATEMENT

The directors are responsible for preparing 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 United Kingdom Generally Accepted

Accounting Practice (United Kingdom Accounting Standards and applicable law), 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 the group and of the profit or loss of the group 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;

-	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 and the group's transactions and disclose with reasonable accuracy at any time the financial position of the

company and the group 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 the group 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 group'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 group's auditors are aware of that information.

AUDITORS

The auditors, Knights Lowe Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

S R Stuteley - Director

31 July 2020

Opinion

We have audited the financial statements of Rackham Group Ltd (the 'parent company') and its subsidiaries (the

'group') for the year ended 31 December 2019 which comprise the Consolidated Income Statement, Consolidated

Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company 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 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 group's and of the parent company affairs as at 31 December 2019 and of the group's 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 group 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 group'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

Directors' Report, 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.

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

-	the Directors' Report has 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 group and the parent company and its environment obtained in

the course of the audit, we have not identified material misstatements in the Directors' Report.

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 by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or

-	the parent company 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; or

-	the directors were not entitled to prepare the financial statements in accordance with the small companies regime and take advantage of the small companies' exemption from the requirement to prepare a Group Strategic Report.

Responsibilities of directors

As explained more fully in the Directors' Responsibilities Statement 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 group's and the parent 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 group or the parent 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.

James Knights ACA BSc (Senior Statutory Auditor)

for and on behalf of Knights Lowe Limited

Eldo House

Kempson Way

Suffolk Business Park

Bury St Edmunds

Suffolk

IP32 7AR

31 July 2020

TURNOVER

4

7,190,936

12,321,316

Cost of sales

2,760,973

5,992,930

GROSS PROFIT

4,429,963

6,328,386

Administrative expenses

1,296,771

1,255,454

3,133,192

5,072,932

Other operating income

(485

)

(13

)

OPERATING PROFIT

6

3,132,707

5,072,919

Income from shares in group undertakings

30,000

-

Income from fixed asset investments

-

15,163

Interest receivable and similar income

7

79,537

104,626

109,537

119,789

3,242,244

5,192,708

Gain/loss on revaluation of assets

113,081

(18,460

)

3,355,325

5,174,248

Interest payable and similar charges

8

334,311

341,757

PROFIT BEFORE TAXATION

3,021,014

4,832,491

Tax on profit

9

560,721

455,904

PROFIT FOR THE FINANCIAL YEAR

2,460,293

4,376,587

Profit attributable to:

Owners of the parent

2,394,531

4,146,326

Non-controlling interests

65,762

230,261

2,460,293

4,376,587

FIXED ASSETS

Intangible assets

12

(5,424,385

)

(5,424,385

)

Tangible assets

13

16,386,439

15,615,985

Investments

14

-

-

Investment property

15

6,725,634

6,593,041

17,687,688

16,784,641

CURRENT ASSETS

Stocks

16

17,074,883

16,611,930

Debtors

17

1,336,305

1,559,763

Investments

18

54,404

48,037

Cash at bank

710,478

11,680,105

19,176,070

29,899,835

CREDITORS

Amounts falling due within one year

19

7,547,618

18,903,648

NET CURRENT ASSETS

11,628,452

10,996,187

TOTAL ASSETS LESS CURRENT LIABILITIES

29,316,140

27,780,828

CREDITORS

Amounts falling due after more than one year

20

(60,000

)

(20,096

)

PROVISIONS FOR LIABILITIES

23

(169,961

)

(160,732

)

NET ASSETS

29,086,179

27,600,000

CAPITAL AND RESERVES

Called up share capital

24

113,776

113,776

Share premium

25

2,338,021

2,338,021

Fair value reserve

25

2,912,652

2,805,169

Retained earnings

25

22,538,610

21,060,797

SHAREHOLDERS' FUNDS

27,903,059

26,317,763

NON-CONTROLLING INTERESTS

26

1,183,120

1,282,237

TOTAL EQUITY

29,086,179

27,600,000

The financial statements have been prepared in accordance with the provisions applicable to companies subject to the

small companies regime.

The financial statements were approved by the Board of Directors and authorised for issue on 31 July 2020 and were

signed on its behalf by:

S R Stuteley - Director

FIXED ASSETS

Intangible assets

12

-

-

Tangible assets

13

-

-

Investments

14

2,463,567

2,463,567

Investment property

15

-

-

2,463,567

2,463,567

CURRENT ASSETS

Debtors

17

1,496

-

CREDITORS

Amounts falling due within one year

19

-

28,504

NET CURRENT ASSETS/(LIABILITIES)

1,496

(28,504

)

TOTAL ASSETS LESS CURRENT LIABILITIES

2,465,063

2,435,063

CAPITAL AND RESERVES

Called up share capital

24

113,776

113,776

Share premium

2,338,021

2,338,021

Retained earnings

13,266

(16,734

)

SHAREHOLDERS' FUNDS

2,465,063

2,435,063

Company's profit for the financial year

902,043

1,270,858

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

The financial statements were approved by the Board of Directors and authorised for issue on 31 July 2020 and were signed on its behalf by:

S R Stuteley - Director

Called up

share

Retained

Share

capital

earnings

premium

£

£

£

Balance at 1 January 2018

113,776

16,826,496

2,338,021

Changes in equity

Dividends

-

(1,273,540

)

-

Total comprehensive income

-

4,146,326

-

Transfer between reserves

-

1,361,515

-

Balance at 31 December 2018

113,776

21,060,797

2,338,021

Changes in equity

Increase in share capital

-

92,809

-

Dividends

-

(902,044

)

-

Total comprehensive income

-

2,394,531

-

Transfer between reserves

-

(107,483

)

-

Balance at 31 December 2019

113,776

22,538,610

2,338,021

Fair

value

Non-controlling

Total

reserve

Total

interests

equity

£

£

£

£

Balance at 1 January 2018

4,166,684

23,444,977

1,077,772

24,522,749

Changes in equity

Dividends

-

(1,273,540

)

(25,796

)

(1,299,336

)

Total comprehensive income

-

4,146,326

230,261

4,376,587

Transfer between reserves

(1,361,515

)

-

-

-

Balance at 31 December 2018

2,805,169

26,317,763

1,282,237

27,600,000

Changes in equity

Increase in share capital

-

92,809

(141,509

)

(48,700

)

Dividends

-

(902,044

)

(23,370

)

(925,414

)

Total comprehensive income

-

2,394,531

65,762

2,460,293

Transfer between reserves

107,483

-

-

-

Balance at 31 December 2019

2,912,652

27,903,059

1,183,120

29,086,179

Called up

share

Retained

Share

Total

capital

earnings

premium

equity

£

£

£

£

Balance at 1 January 2018

113,776

(13,434

)

2,338,021

2,438,363

Changes in equity

Dividends

-

(1,274,158

)

-

(1,274,158

)

Total comprehensive income

-

1,270,858

-

1,270,858

Balance at 31 December 2018

113,776

(16,734

)

2,338,021

2,435,063

Changes in equity

Dividends

-

(872,043

)

-

(872,043

)

Total comprehensive income

-

902,043

-

902,043

Balance at 31 December 2019

113,776

13,266

2,338,021

2,465,063

1.	STATUTORY INFORMATION

Rackham Group Ltd 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 General Information page.

The presentation currency of the financial statements is the Pound Sterling (£).

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

These financial statements have been prepared in accordance with the provisions of Section 1A "Small Entities"

of Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of

Ireland" and the Companies Act 2006. There were no material departures from those standards. The financial

statements have been prepared under the historical cost convention as modified by the revaluation of certain

fixed assets.

Basis of consolidation

The consolidated financial statements incorporate the results of the Company and entities controlled by the

Company (its subsidiaries) made up to 31 December each year. Control is achieved where the Company has the

power to govern the financial and operating policies of the investee entity. Minority interest are accounted for

in accordance with section 9 of Financial Reporting Standard 102 whereby the results and net assets of an

investee are wholly consolidated and minority interests are disclosed on the profit and loss account and

balance sheet in proportion to the share of the equity held in the investee.

Upon acquisition, adjustments are made as required to subsidiaries financial statements so as to align

accounting policies with those of the Group. Goodwill is recognised and treated as stated below.

All intra-group transactions, balances, income and expenses are eliminated on consolidation.

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.

Transactions between group entities which have been eliminated on consolidation are not disclosed within the

financial statements.

Turnover

Turnover represents amounts receivable derived from the Group's ordinary activities, net of discounts and

excluding value added tax. Revenue is recognised as follows:

Rental and similar income is accrued on a time basis in the period to which it relates by reference to underlying

contracts.

Income from the sale of land and buildings is recognised at the date of unconditional exchange of contract.

Livestock and produce revenue is recognised at the point legal title to stock passes to the customer, normally at

collection or delivery.

Interest income is accrued on a time basis by reference to the underlying capital sum and applicable interest

rate.

Dividend income from investments is recognised at the date of receipt.

Goodwill

Goodwill arising on consolidation is included in the accounts based on the fair value of net assets of the

subsidiary acquired at the date of acquisition. Amortisation is charged over the estimated life of goodwill.

Negative goodwill is written back to the profit and loss account upon disposal of the underlying investment in

the subsidiary.

Intangible assets

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

less any accumulated amortisation and any accumulated impairment losses.

Tangible fixed assets

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

Freehold property

-

not provided

Plant and machinery

-

5 years straight line

Fixtures and fittings

-

5 years straight line

Motor vehicles

-

4 years straight line

The directors estimate residual values on an asset by asset basis and apply depreciation accordingly. During the

year a full review has been made of estimated residual values of non-investment freehold property and the

directors consider that such values for all properties are likely to be at, or above, book value. Accordingly, no

depreciation has been charged during the year on freehold property. The position will be reviewed annually.

Investment property

Investment property held to earn rental income and/or capital appreciation is included in the balance sheet at

fair value where such value can be measured reliably without undue cost or effort on an ongoing basis. Fair

value adjustments are taken to the profit and loss account.The property is not depreciated which is a treatment

contrary to the Companies Act 2006 however in the opinion of the Directors the policy adopted by the

Company provides a true and fair view.

The majority of such properties are on the main farming estate and are thus difficult to independently value. In

accordance with Section 16 of FRS 102 such properties are accounted for under the principles applying to

property plant and equipment as described above.

Stocks

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and

slow moving items.

For stock properties, cost comprises the cost of acquisition of property, professional and planning fees and

construction and infrastructure costs, but excludes overheads. Net realisable value represents the estimated

selling price less all estimated costs of completion and costs to be incurred in marketing and selling the

properties.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Consolidated 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.

Taxation

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.

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.

Pension costs and other post-retirement benefits

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

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

Derivative financial instruments

The company uses derivative financial instruments to reduce exposure to interest rate movements. The

company does not hold or issue derivative financial instruments for speculative reasons.

Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are

subsequently remeasured to their fair value at each reporting date. The resulting gain or loss is recognised in

the profit and loss immediately unless the derivative is designated and effective as a hedging instrument, in

which event the timing of the recognition in the profit or loss depends on the nature of the hedge relationship.

The best evidence of fair value is quoted price for an identical asset in an active market. When quoted prices

are unavailable, the price of a recent transaction for an identical asset provides evidence of fair value as long as

there has not been a significant change in economic circumstances or a significant lapse of time since the

transaction took place. If the market is not active and recent transactions of an identical asset on their own are

not a good estimate of fair value, the fair value is estimated by using a valuation technique.

Current asset investments

Investments comprise current asset investments which are originally recognised at cost. Where the fair value

can be reliably determined, the investments are subsequently stated at fair value at each balance sheet date

with change to values being recognised in the profit and loss account. Those current investments where fair

values cannot be reliably determined are stated at cost.

3.	CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

In the application of the Group's accounting policies, which are described below, 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 estimated and underlying assumptions are reviewed on an ongoing basis. Revision to accounting estimates

are recognised in the period in which the estimate is revised if revision affects only that and future periods.

The following are critical judgements including those involving estimations, that the directors have made in the

process of applying the Group's accounting policies and that have the most significant effect on the amounts

recognised in the financial statements.

Depreciation of tangible fixed assets - property, plant and machinery

Tangible fixed assets are recognised at cost and depreciated on the basis appropriate to charge to the profit

and loss the economic consumption of those assets during the accounting period. The charge is calculated as

described below and is based on the directors knowledge of the reduction in the residual value of trading assets

and estate property on average over the investment cycle of each class of asset. The rates of depreciation are

kept under review such that assets are written down to residual value at the end of the economic lives of the

assets.

Revaluation of investment properties

The Group carries investment properties at fair value, with changes in fair value being recognised in the profit

or loss. The Directors have determined fair values on a property by property basis at open market value based

on assumptions on expected yield given the location and nature of the property comparable to other known

sales or potential sales in the region. Where considered appropriate, the directors seek formal or informal

valuations by land and estate agents.

4.

TURNOVER

The turnover and profit before taxation are attributable to the principal activities of the group.

An analysis of turnover by class of business is given below:

2019

2018

£

£

Farming income

2,052,496

1,559,129

Property development and sales

2,680,000

8,103,407

Letting and lease income

2,229,800

2,510,782

Other operating income

228,640

147,998

7,190,936

12,321,316

5.	EMPLOYEES AND DIRECTORS

The average number of employees during the year was 14 (2018 - 14 ) .

The average number of employees by undertakings that were proportionately consolidated during the year was

3 (2018 - 3 ) .