Clayton Finance Limited - Accounts

Registered number

01392635

Clayton Finance Limited

Report and Financial Statements

31 December 2019

API Partnership Limited t/a Chandler & Georges

Chartered Accountants

75 Westow Hill

London

SE19 1TX

www.chandlerandgeorges.co.uk

Clayton Finance Limited
Report and accounts
Contents
Page
Company information	1
Director's report	2
Statement of director's responsibilities	3
Strategic report	4
Independent auditor's report	5 - 6
Income statement	7
Statement of financial position	8
Statement of changes in equity	9
Statement of cash flows	10
Notes to the financial statements	11 - 18

Clayton Finance Limited

Company Information

Director

Mr S Datwani

Secretary

Mr S Datwani

Auditors

API Partnership Limited t/a Chandler & Georges

75 Westow Hill

Crystal Palace

London

SE19 1TX

Bankers

NatWest Bank Plc

315 Station Road

Harrow

HA1 2AD

Registered office

75 Westow Hill

Crystal Palace

London

SE19 1TX

Registered number

01392635

Clayton Finance Limited
Registered number:				01392635
Director's Report
The director presents his report and financial statements for the year ended 31 December 2019.
Principal place of business
Clayton Finance Limited is a company incorporated and domiciled in England and has its registered office at 75 Westow Hill, London, SE19 1TX and principal place of business at Landmark, 3-4 Devonshire Street, London, W1W 5DT.
Results and appropriations
The results and the state of affairs of the company for the year are set out in the financial statements on pages 7 to 18. During the year company paid dividends of £140,000. The retained profit for the financial year of £291,527 will therefore be taken to reserves.
Events since the balance sheet date
The ongoing COVID-19 pandemic spread to the United Kingdom in late January 2020. In March the UK government issued guidance and restrictions designed to slow the spread of the virus. This is an unprecedented global event and it is impossible to determine the likely future impact of the pandemic on the company and the economies on which it is dependent. In the opinion of the director, there is no need for the company to make any adjustment to the reported profit for the year ended 31 December 2019 and to its financial position at that date.
Directors
The following persons served as directors during the year:
	Mr S Datwani
Disclosure of information to auditors

The director confirms that:
●	so far as he is aware, there is no relevant audit information of which the company's auditor is unaware; and
●	he has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditor is aware of that information.

Strategic Report

The company has chosen in accordance with s.414C(11) Companies Act 2006 to set out in the company's strategic report information required by Schedule 7 of the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008 to be contained in the director's report. It has done so in respect of future developments and financial instruments.

This report was approved by the board on 29 December 2020 and signed on its behalf.

Mr S Datwani

Director

Clayton Finance Limited

Statement of Director's Responsibilities

The director is responsible for preparing the report and financial statements in accordance with applicable law and regulations.
Company law requires the director to prepare financial statements for each financial year. Under that law the director has elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (Financial Reporting Standard 102 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 affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the director is required to:
●	select suitable accounting policies and then apply them consistently;
●	make judgements and estimates that are reasonable and prudent;
●	state whether applicable UK 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 director is 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 him to ensure that the financial statements comply with the Companies Act 2006. He is 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.

Clayton Finance Limited
Strategic Report
Business review
	The profit for the financial year, after taxation, amounted to £431,527 (2018 : profit of £247,898).
	The increase in turnover, from £12.2million in 2018 to £15.1million in 2019, was driven by a rise in metal sales. Turnover from the sale of other (non-metal) commodities remained relatively static, however they contributed most to the increase in gross profit. The marked increase in administrative expenses is largely explained by the following factors: Challenging trading conditions faced by customers in Nigeria, particularly post pandemic, which creates considerable doubt in the recoverability of some trade debtor balances. Consequently bad debts of £423,209 have been charged to the profit and loss account. The strengthening of the British Pound relative to the US Dollar gives rise to foreign exchange losses of £71,376 in 2019, compared to foreign exchange gains of £101,015 in 2018.
Principal risk and uncertainties
	The company faces a number of business risks and uncertainties due to the ongoing pandemic and its current dependence on the Nigerian market. In response the company continues to explore other markets and is in the process of applying for a Coronavirus Business Interruption Loan.
Future developments
	The director anticipates that similar levels of trading activity and profitability will continue into the foreseeable future, despite the challenges that the ongoing pandemic presents.
Financial instruments
	Financial instruments are carefully managed to ensure that there is little or no liquidity risk. The company’s principal financial instruments comprise of debtors and creditors. Credit and liquidity risk is minimised by ensuring credit terms for most customers are on Letter of Credit and shorter for debtors than for creditors on open credit. All sales are to overseas customers and foreign exchange risk is minimised as most purchases and corresponding sales are in the same currency. Sufficient funds are held in respective foreign currencies for all other transactions.
This report was approved by the board on 29 December 2020 and signed on its behalf.
Mr S Datwani
Director

Clayton Finance Limited

Independent auditor's report

to the members of Clayton Finance Limited

Opinion

We have audited the financial statements of Clayton Finance Limited for the year ended 31 December 2019 which comprise the Income Statement, the Statement of Financial Position, the Statement of Changes in Equity, the Statement of Cash Flows 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 the 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 2019 and of its profit for the year then ended;
●	have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice;
●	have been prepared in accordance with the requirements of the Companies Act 2006.

Basis of 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
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 other information comprises the information included in the report and financial statements, other than the financial statements and our auditor's report thereon. The directors are responsible for the other information. 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 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 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 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.

Responsibilities of directors

As explained more fully in the directors’ responsibilities statement, 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 either intend 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.

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 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 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.
Achilleas Sotiriou
(Senior Statutory Auditor)		75 Westow Hill
for and on behalf of		London
API Partnership Limited t/a Chandler & Georges		SE19 1TX
Accountants and Statutory Auditors
29 December 2020

Clayton Finance Limited
Income Statement
for the year ended 31 December 2019
Notes						2019		2018
£							£
Turnover				2		15,095,992		12,179,112
Cost of sales						(13,393,886)		(11,229,882)
Gross profit						1,702,106		949,230
Distribution costs						(256,209)		(287,822)
Administrative expenses						(972,215)		(387,209)
Operating profit				3		473,682		274,199
Interest receivable						63,006		32,787
Interest payable				6		(3,477)		(76)
Profit on ordinary activities before taxation						533,211		306,910
Tax on profit on ordinary activities				7		(101,684)		(59,012)
Profit for the financial year						431,527		247,898

Clayton Finance Limited
Statement of Financial Position
as at 31 December 2019
Notes				2019			2018
£					£
Fixed assets
Tangible assets	8			1,256			521
Current assets
Debtors	9		9,661,339			7,660,944
Cash at bank and in hand			1,397,813			3,592,481
			11,059,152			11,253,425
Creditors: amounts falling due within one year	10		(7,214,394)			(7,699,459)
Net current assets				3,844,758			3,553,966
Net assets				3,846,014			3,554,487
Capital and reserves
Called up share capital	11			200,000			200,000
Profit and loss account	12			3,646,014			3,354,487
Total equity				3,846,014			3,554,487
Mr S Datwani
Director
Approved by the board on 29 December 2020

Clayton Finance Limited
Statement of Changes in Equity
for the year ended 31 December 2019
Share			Share		Other		Profit		Total
capital			premium		reserves		and loss
account
£			£		£		£		£
At 1 January 2018		200,000		-		-		3,166,589		3,366,589
Profit for the financial year								247,898		247,898
Dividends								(60,000)		(60,000)
At 31 December 2018		200,000		-		-		3,354,487		3,554,487
At 1 January 2019		200,000		-		-		3,354,487		3,554,487
Profit for the financial year								431,527		431,527
Dividends								(140,000)		(140,000)
At 31 December 2019		200,000		-		-		3,646,014		3,846,014

Clayton Finance Limited
Statement of Cash Flows
for the year ended 31 December 2019
Notes			2019		2018
£				£
Operating activities
Profit for the financial year			431,527		247,898
Adjustments for:
Interest receivable			(63,006)		(32,787)
Interest payable			3,477		76
Tax on profit on ordinary activities			101,684		59,012
Depreciation			592		411
Increase in debtors			(2,000,395)		(708,329)
(Decrease)/increase in creditors			(531,576)		373,700
			(2,057,697)		(60,019)
Interest received			63,006		32,787
Interest paid			(3,477)		(76)
Corporation tax paid			(55,173)		(130,096)
Cash used in operating activities			(2,053,341)		(157,404)
Investing activities
Payments to acquire tangible fixed assets			(1,327)		-
Cash used in investing activities			(1,327)		-
Financing activities
Equity dividends paid			(140,000)		(60,000)
Cash used in financing activities			(140,000)		(60,000)
Net cash used
Cash used in operating activities			(2,053,341)		(157,404)
Cash used in investing activities			(1,327)		-
Cash used in financing activities			(140,000)		(60,000)
Net cash used			(2,194,668)		(217,404)
Cash and cash equivalents at 1 January			3,592,481		3,809,885
Cash and cash equivalents at 31 December			1,397,813		3,592,481
Cash and cash equivalents comprise:
Cash at bank			1,397,813		3,592,481

Clayton Finance Limited
Notes to the Accounts
for the year ended 31 December 2019
1	Summary of significant accounting policies
	Basis of preparation
	The financial statements have been prepared under the historical cost convention and in accordance with FRS 102, The Financial Reporting Standard applicable in the UK and Republic of Ireland.
	Turnover
	Turnover represents the invoiced value of goods supplied by the company, net of value added tax and trade discounts.
	Going concern
	The directors have considered the impact of the Covid-19 and have responded accordingly to safeguard the business. The Covid-19 pandemic and the ensuing reduction in global demand has led to the director commencing the application process for a Coronavirus Business Interruption Loan to ensure they are well positioned to respond to returning demand. The financial statements have been prepared on a going concern basis since the director has prepared trading and cashflow forecasts, which show that the company will have sufficient working capital for the foreseeable future.
	Tangible fixed assets

	Tangible fixed assets are measured at cost less accumulative depreciation and any accumulative impairment losses. Depreciation is provided on all tangible fixed assets, other than freehold land, at rates calculated to write off the cost, less estimated residual value, of each asset evenly over its expected useful life, as follows:
	Plant and machinery			4/6.66 years

	Debtors
	Short term debtors are measured at transaction price (which is usually the invoice price), less any impairment losses for bad and doubtful debts. Loans and other financial assets are initially at fair value, net of transaction costs and subsequently measured at amortised cost determined using the effective interest method, less any impairment losses for bad and doubtful debts.
	Creditors
	Short term creditors are measured at transaction price (which is usually the invoice price). Loans and other financial liabilities are initially recognised at fair value, net of any transaction costs and subsequently measured at amortised cost determined using the effective interest method.
	Taxation
	A current tax liability is recognised for the tax payable on the taxable profit of the current and past periods. A current tax asset is recognised in respect of a tax loss that can be carried back to recover tax paid in a previous period. Deferred tax is recognised in respect of all timing differences between the recognition of income and expenses in the financial statements and their inclusion in tax assessments. 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. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing difference, except for revalued land and investment property where the tax rate that applies to the sale of the asset is used. Current and deferred tax assets and liabilities are not discounted.
	Foreign currency translation
	Transactions in foreign currencies are initially recognised at the average rate of exchange for the year. At the end of each reporting period foreign currency monetary items are translated at the closing rate of exchange. Non-monetary items that are measured at historical cost are translated at the rate ruling at the date of the transaction. All differences are charged to profit or loss.
	Pensions
	Contributions to defined contribution plans are expensed in the period to which they relate.
2	Analysis of turnover					2019		2018
£							£
	Sale of goods					15,095,992		12,179,112
	By geographical market:
	Africa					14,982,228		11,986,277
	Rest of world					113,764		192,835
						15,095,992		12,179,112
3	Operating profit					2019		2018
£							£
	This is stated after charging:
	Depreciation of owned fixed assets					592		411
	Operating lease rentals - land and buildings					85,092		85,092
	Auditors' remuneration for audit services					13,000		11,500
	Auditors' remuneration for other services					4,275		4,225
	Contributions to defined benefit pension plans					10,412		9,004
4	Director's emoluments					2019		2018
£							£
	Emoluments					36,382		36,382
5	Staff costs					2019		2018
£							£
	Wages and salaries					215,441		213,598
	Social security costs					22,711		21,707
	Other pension costs					10,412		9,004
						248,564		244,309
	Average number of employees during the year					Number	Number
	Administration					5		6
	Sales					2		2
						7		8
6	Interest payable					2019		2018
£							£
	Bank loans and overdrafts					1		76
	Other interest					3,476		-
						3,477		76
7	Taxation					2019		2018
£							£
	Analysis of charge in period
	Current tax:
	UK corporation tax on profits of the period					101,684		59,012
	Tax on profit on ordinary activities					101,684		59,012
	Factors affecting tax charge for period
	The differences between the tax assessed for the period and the standard rate of corporation tax are explained as follows:
						2019		2018
£							£
	Profit on ordinary activities before tax					533,211		306,910
	Standard rate of corporation tax in the UK					19%		19%
£							£
	Profit on ordinary activities multiplied by the standard rate of corporation tax					101,310		58,313
	Effects of:
	Expenses not deductible for tax purposes					355		680
	Capital allowances for period in excess of depreciation					19		19
	Current tax charge for period					101,684		59,012
8	Tangible fixed assets
								Fixtures, fittings, tools and equipment
								At cost
£
	Cost or valuation
	At 1 January 2019							119,845
	Additions							1,327
	At 31 December 2019							121,172
	Depreciation
	At 1 January 2019							119,324
	Charge for the year							592
	At 31 December 2019							119,916
	Carrying amount
	At 31 December 2019							1,256
	At 31 December 2018							521
9	Debtors					2019		2018
£							£
	Trade debtors					5,654,104		4,413,332
	Other debtors					3,743,113		3,030,984
	Prepayments and accrued income					264,122		216,628
						9,661,339		7,660,944
10	Creditors: amounts falling due within one year					2019		2018
£							£
	Trade creditors					6,902,147		7,237,533
	Corporation tax					102,704		56,193
	Other taxes and social security costs					5,436		1,254
	Other creditors					138,533		349,297
	Accruals and deferred income					65,574		55,182
						7,214,394		7,699,459
11	Share capital	Nominal		2019		2019		2018
value			Number		£		£
	Allotted, called up and fully paid:
	Ordinary shares	£1 each		200,000		200,000		200,000
12	Profit and loss account					2019		2018
£							£
	At 1 January					3,354,487		3,166,589
	Profit for the financial year					431,527		247,898
	Dividends					(140,000)		(60,000)
	At 31 December					3,646,014		3,354,487
13	Dividends					2019		2018
£							£
	Dividends on ordinary shares (note 12)					140,000		60,000
14	Other financial commitments
	Total future minimum lease payments under non-cancellable operating leases:
		Land and buildings		Land and buildings	Other		Other
		2019		2018		2019		2018
£			£		£		£
	Falling due:
	within one year	35,970		-		-		-
	within two to five years	-		75,000		-		-
		35,970		75,000		-		-
15	Related party transactions
	Mr B Datwani - Close family member Included in Other debtors is a balance owed by Mr B Datwani, a former director of the company. No interest is charged and the loan is repayable on demand. Amount due from the related party 2019 £1,405,498 (2018 £1,179,941) Emrick Resources Ltd - Associate Included in Trade creditors and Other creditors is an amount due to Emrick Resources Ltd. Amount due to the related party 2019 £903,940 (2018 £1,085,841) Other related parties under common key management: Included in Other debtors are loans made to the below companies, where Mr S Datwani is a director or where there is a close family connection. The loans are charged at base rate plus 4% and are repayable on demand. Amount due from the related party Landstone Homes (Harold) Ltd 2019 £nil (2018 £26,388) SPF Bridging Ltd 2019 £155,614 (2018 £148,913) Ruleform Limited 2019 £493,715 (2018 £356,188) Centennial Centre Trading (2014) Ltd 2019 £8,256 (2018 £114,341) Rulecare Limited 2019 £376,011 (2018 £315,075) Margaret Property Investments Ltd 2019 £252,133 (2018 £nil) Rulecrown Properties Ltd 2019 £56,029 (2018 £nil) Black Swan Homes (Sheldon) Ltd 2019 £84,352 (2018 £nil) Cityland Investments Ltd 2019 £262,473 (2018 £nil) CRGashby Ltd 2019 £12,884 (2018 creditor of £33,569) Landstone Homes (Goldenhill) Ltd 2019 £18,990 (2018 £18,172) Included in Other creditors are amounts due to the below companies, where Mr S Datwani is a director. The loans are charged at base rate plus 4% and repayable on demand. Amount due to the related party The H Suite Limited 2019 £3,621 (2018 £3,465)
16	Controlling party
	The company is controlled by Mr S Datwani.
17	Presentation currency
	The financial statements are presented in Sterling.
18	Legal form of entity and country of incorporation
	Clayton Finance Limited is a private company limited by shares and incorporated in England.
19	Principal place of business
	The address of the company's principal place of business is:
	Landmark
	3-4 Devonshire Street
	London
	W1W 5DT