Plasto-Sac UK Limited - Limited company accounts 20.1

REGISTERED NUMBER: 03752593 (England and Wales)

STRATEGIC REPORT, REPORT OF THE DIRECTORS AND

AUDITED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2020

FOR

PLASTO-SAC UK LIMITED

Page

Company Information

1

Strategic Report

2

Report of the Directors

3

Report of the Independent Auditors

5

Statement of Comprehensive Income

9

Balance Sheet

10

Statement of Changes in Equity

11

Notes to the Financial Statements

12

Reconciliation of Equity

26

Reconciliation of Loss

28

DIRECTORS:

J M Whitehead

K Heath

SECRETARY:

J M Whitehead

REGISTERED OFFICE:

Holme Bush

9 Trafford Road

Alderley Edge

Cheshire

SK9 7NN

REGISTERED NUMBER:

03752593 (England and Wales)

AUDITORS:

D.R.E. & Co. (Audit) Limited

6 Claremont Buildings

Claremont Bank

Shrewsbury

Shropshire

SY1 1RJ

The directors present their strategic report for the year ended 31 December 2020.

REVIEW OF BUSINESS

The directors are satisfied with the results for the year. Further details can be obtained from the parent company's accounts (see note 21 of the full financial statements for further details).

Following the management buy out the directors have focussed on improving the way the company services customers in core areas of the business and cost management. In addition, the directors are set to release new and improved products in order to diversify their product portfolio and reach out to new customers.

In spite of the ongoing Covid-19 pandemic, the directors are pleased to present an improved and prosperous financial position with the view to continue to improve the financial position through 2021 and into the future.

Key performance indicators

The company monitors its performance using key performance indicators. The company considers its main key performance indicators to be like for like sales growth, gross margin and operating profit. Performance on these measures is shown below and is in line with the expectations of the board.

2020

2019

% change

Turnover

£17,305,115

£15,904,173

8.81%

Gross margin

16.56%

15.27%

1.29%

Operating profit

£410,070

(£149,786

)

PRINCIPAL RISKS AND UNCERTAINTIES

The company operates in a very competitive market which is a continuing risk and may result in sales being lost to competitors. The company manages this risk by providing excellent service in all its activities, continued product development and a proactive approach to design and innovation.

Financial risk management objectives and policies

The company's activities expose it to a number of financial risks including credit risk and liquidity risk. The board approves treasury policies, which are controlled on a day-to-day basis by senior management.

Credit risk

The company's principal financial assets are trade debtors arising from the company's prime activity which is the development, design, print and conversion of flexible and corrugated packaging, including storage and distribution of the same. In order to manage credit risk, the directors set limits for customers based on a combination of payment history, third party credit references and market intelligence. Credit limits are reviewed by the credit controller on a regular basis in conjunction with debt ageing and collection history.

Liquidity risk

The company seeks to manage financial risk by ensuring sufficient liquidity is available to meet foreseeable needs.

ON BEHALF OF THE BOARD:

J M Whitehead - Secretary

10 March 2021

The directors present their report with the financial statements of the company for the year ended 31 December 2020.

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of the development, design, print and conversion of flexible and corrugated packaging.

DIVIDENDS

No dividends will be distributed for the year ended 31 December 2020.

DIRECTORS

J M Whitehead has held office during the whole of the period from 1 January 2020 to the date of this report.

Other changes in directors holding office are as follows:

G Nagar - resigned 28 February 2020

K Heath - appointed 11 November 2020

DISCLOSURE IN THE STRATEGIC REPORT

The company has chosen, in accordance with s414C(11) of the Companies Act, to set out in the company's strategic report information regarding the review of business and a description of the principal risks and uncertainties facing the company.

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 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). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

-	select suitable accounting policies 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 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.

AUDITORS

The auditors, D.R.E. & Co. (Audit) Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

J M Whitehead - Secretary

10 March 2021

Opinion

We have audited the financial statements of Plasto-Sac UK Limited (the 'company') for the year ended 31 December 2020 which comprise the Statement of Comprehensive Income, Balance Sheet, 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 company's affairs as at 31 December 2020 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

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

The 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 this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

-	the information given in the Strategic Report and the 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 three, 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.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:

- the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;

- we identified the laws and regulations applicable to the company through discussions with directors and other management, and from our commercial knowledge and experience of the client's operating sector;

- we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including the Companies Act 2006, taxation legislation, employment, environmental, health and safety legislation and the BRC Global Standards for Packaging and Packaging Materials;

- we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management; and

- identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.

We assessed the susceptibility of the company's financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

- making enquiries of management as to their knowledge of actual, suspected and alleged fraud; and

- reviewing the client's system notes and internal controls.

To address the risk of fraud through management bias and override of controls, we:

- performed analytical procedures to identify any unusual or unexpected relationships;

- tested journal entries to identify unusual transactions;

- assessed whether judgements and assumptions made in determining the accounting estimates set out in note 3 were indicative of potential bias; and

- investigated the rationale behind significant or unusual transactions.

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

- agreeing financial statement disclosures to underlying supporting documentation;

- enquiring of management as to actual and potential litigation and claims; and

- reviewing correspondence with HMRC.

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

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.

Francis Nock F.C.C.A. (Senior Statutory Auditor)

for and on behalf of D.R.E. & Co. (Audit) Limited

6 Claremont Buildings

Claremont Bank

Shrewsbury

Shropshire

SY1 1RJ

10 March 2021

TURNOVER

4

17,305,115

15,904,173

Cost of sales

(14,440,046

)

(13,474,872

)

GROSS PROFIT

2,865,069

2,429,301

Distribution costs

(467,970

)

(693,047

)

Administrative expenses

(1,987,029

)

(1,892,040

)

410,070

(155,786

)

Other operating income

-

6,000

OPERATING PROFIT/(LOSS)

6

410,070

(149,786

)

Interest receivable and similar income

12,306

49,524

422,376

(100,262

)

Interest payable and similar expenses

7

(125,278

)

(757

)

PROFIT/(LOSS) BEFORE TAXATION

297,098

(101,019

)

Tax on profit/(loss)

8

(41,431

)

31,588

PROFIT/(LOSS) FOR THE FINANCIAL YEAR

255,667

(69,431

)

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

255,667

(69,431

)

FIXED ASSETS

Intangible assets

9

332,465

310,626

Tangible assets

10

540,283

637,913

872,748

948,539

CURRENT ASSETS

Stocks

11

2,368,665

2,387,613

Debtors

12

7,322,194

4,074,173

Cash at bank and in hand

744,363

1,595,988

10,435,222

8,057,774

CREDITORS

Amounts falling due within one year

13

8,123,959

5,460,166

NET CURRENT ASSETS

2,311,263

2,597,608

TOTAL ASSETS LESS CURRENT LIABILITIES

3,184,011

3,546,147

CREDITORS

Amounts falling due after more than one year

14

(1,993,320

)

(2,646,426

)

PROVISIONS FOR LIABILITIES

18

(136,791

)

(101,488

)

NET ASSETS

1,053,900

798,233

CAPITAL AND RESERVES

Called up share capital

19

100

100

Retained earnings

20

1,053,800

798,133

SHAREHOLDERS' FUNDS

1,053,900

798,233

The financial statements were approved by the Board of Directors and authorised for issue on 10 March 2021 and were signed on its behalf by:

J M Whitehead - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 January 2019

100

867,564

867,664

Changes in equity

Total comprehensive income

-

(69,431

)

(69,431

)

Balance at 31 December 2019

100

798,133

798,233

Changes in equity

Total comprehensive income

-

255,667

255,667

Balance at 31 December 2020

100

1,053,800

1,053,900

1.	STATUTORY INFORMATION

Plasto-Sac UK Limited is a private company, limited by shares, incorporated and registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page.

The principal place of business is Unit 19, John Bradshaw Court, Alexandria Way, Congleton, Cheshire, CW12 1LB.

2.	STATEMENT OF COMPLIANCE

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" and the Companies Act 2006.

3.	ACCOUNTING POLICIES

Basis of preparing the financial statements

The financial statements have been prepared under the historical cost convention.

These financial statements are for the individual entity only.

The financial statements are presented in Sterling (£), rounded to the nearest £1.

Financial Reporting Standard 102 - reduced disclosure exemptions

The company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":

•

the requirements of Section 7 Statement of Cash Flows;

•

the requirement of paragraph 3.17(d);

•

the requirements of paragraphs 11.42, 11.44, 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);

•

the requirements of paragraphs 12.26, 12.27, 12.29(a), 12.29(b) and 12.29A;

•

the requirements of paragraphs 26.18(b), 26.19 to 26.21 and 26.23;

•

the requirement of paragraph 33.7;

•

the requirements of paragraph 24(b) of IFRS 6.

First year adoption of Financial Reporting Standard 102 ( FRS 102)

These financial statements for the year ended 31 December 2020 are the first that are prepared in accordance with FRS 102. The previous financial statements were prepared in accordance with IFRS, the date of transition to FRS 102 is 1 January 2019.

There have been no changes to accounting policies as a result of this transition with the exception of no longer recognising operating leases under IFRS16. See the reconciliation of equity for details of the transition.

Significant judgements and estimates

The company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below.

The annual depreciation charge for property, plant and equipment is sensitive to changes in the estimated useful economic lives and residual values of the assets. The useful economic lives and residual values are re-assessed annually. They are amended when necessary to reflect current estimates, economic utilisation and the physical condition of the assets. See note 10 for the carrying amount of property, plant and equipment, and note 3 for the useful economic lives for each class of assets.

The company makes an estimate of the recoverable value of stock. When calculating the stock provision, management considers anticipated saleability of stock by reference to sales in recent periods and obsolescence. See note 11 for the net carrying amount of stock.

The company includes an element of overheads in the carrying value of stock. When calculating the overheads included within stock, management considers costs related to handling and processing stock. See note 11 for the net carrying amount of stock.

The company makes an estimate of the recoverable value of trade receivables. When assessing impairment of trade receivables, management considers factors including the current credit rating of the receivables, the ageing profile of debtors and historical experience. See note 12 for the net carrying amount of receivables.

Turnover

Turnover represents net invoiced sales of goods, excluding value added tax. Turnover is recognised when the goods are physically delivered to the customer.

Goodwill

Goodwill, being the amount paid in connection with the acquisition of a business in 2014, is being amortised evenly over its estimated useful life of ten years.

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.

Costs relating to licences have been capitalised within intangible assets and are amortised over a period of 3 years on a straight line basis.

Development costs have been capitalised within intangible assets and will be amortised over a period of 3 years from the time the products developed start to generate revenue.

Tangible fixed assets

Tangible fixed assets are stated at historic cost less accumulated depreciation. Costs include original purchase price of the asset and the costs attributable to bringing the asset to its working condition for its intended use.

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

Improvements to property

- 20% on cost, 25% on cost and 33% on cost

Plant and machinery

- 20% on cost, 33% on cost and 50% on cost

Fixtures and fittings

- 20% on cost and 25% on cost

Motor vehicles

- 20% on cost

Computer equipment

- 20% on cost

Stocks

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items and provision for attributable overheads.

Financial instruments

The company has chosen to adopt Sections 11 and 12 of FRS 102 in respect of financial instruments.

(i) Financial assets

Basic financial assets, including trade and other receivables, amounts owed by group companies and cash and bank balances, are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.

Such assets are subsequently carried at amortised cost.

At the end of each reporting period financial assets measured at amortised cost are assessed for objective evidence of impairment. If an asset is impaired the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset's original effective interest rate. The impairment loss is recognised in profit or loss.

If there is decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Financial assets are derecognised when (a) the contractual rights to the cash flows from the asset expire or are settled, or (b) substantially all the risks and rewards of the ownership of the asset are transferred to another party, or (c) despite having retained some significant risks and rewards of ownership, control of the asset has been transferred to another party who has the practical ability to unilaterally sell the asset to an unrelated third party without imposing additional restrictions.

(ii) Financial liabilities

Basic financial liabilities, including trade payables and bank overdrafts, are initially recognised at transaction price, unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest.

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade payables are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Financial liabilities are derecognised when the liability is extinguished, that is when the contractual obligation is discharged, cancelled or expires.

Taxation

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

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 the profit and loss account 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 are charged to the profit and loss account in the period to which they relate.

Profit share agreement

The company entered into a Profit Sharing Agreement in 2012 with Cloudside Associates Limited. Previously, the company recognised the fair value of the liability under the agreement at the balance sheet date, in accordance with IAS32 - Financial Instruments: Presentation. As a result of the management buy out, this agreement was terminated during the year.

4.

TURNOVER

The turnover and profit (2019 - loss) before taxation are attributable to the one principal activity of the company.

An analysis of turnover by geographical market is given below:

31.12.20

31.12.19

£

£

UK sales

16,349,297

14,829,591

Foreign sales

955,818

1,074,582

17,305,115

15,904,173

5.	EMPLOYEES AND DIRECTORS

31.12.20

31.12.19

£

£

Wages and salaries

988,703

887,386

Social security costs

98,630

87,538

Other pension costs

18,049

16,182

1,105,382

991,106

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

31.12.20

31.12.19

Directors

1

1

Sales & administration

17

18

Warehouse & distribution

15

11

33

30

31.12.20

31.12.19

£

£

Directors' remuneration

30,124

6,472

Directors' pension contributions to money purchase schemes

179

-

6.	OPERATING PROFIT/(LOSS)

The operating profit (2019 - operating loss) is stated after charging/(crediting):

31.12.20

31.12.19

£

£

Depreciation - owned assets

305,925

304,052

Depreciation - assets on hire purchase contracts

5,789

5,789

Profit on disposal of fixed assets

(1,086

)

(2,029

)

Goodwill amortisation

17,000

17,000

Development costs amortisation

77,971

-

Auditors' remuneration

26,017

25,093

Auditors' remuneration for non audit work

22,293

5,865

Foreign exchange differences

16,148

185

Hire of plant and machinery

41,984

17,353

7.

INTEREST PAYABLE AND SIMILAR EXPENSES

31.12.20

31.12.19

£

£

Other interest charged

124,528

-

Hire purchase

750

757

125,278

757

8.

TAXATION

Analysis of the tax charge/(credit)

The tax charge/(credit) on the profit for the year was as follows:

31.12.20

31.12.19

£

£

Current tax:

UK corporation tax

(5,872

)

(43,126

)

(Over) / Under provision in prior year

-

(21,610

)

Total current tax

(5,872

)

(64,736

)

Deferred tax

47,303

33,148

Tax on profit/(loss)

41,431

(31,588

)

Reconciliation of total tax charge/(credit) included in profit and loss

The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained below:

31.12.20

31.12.19

£

£

Profit/(loss) before tax

297,098

(101,019

)

Profit/(loss) multiplied by the standard rate of corporation tax in the UK of 19% (2019 - 19%)

56,449

(19,194

)

Effects of:

Expenses not deductible for tax purposes

6,015

3,540

Income not chargeable for tax purposes

(2,817

)

(9,120

)

Depreciation in excess of capital allowances

(9,955

)

(34,631

)

Deferred taxation

47,303

33,148

Over provision in prior year

-

(21,610

)

Loss carried forward / enhanced relief

(19,517

)

16,279

Utilisation of tax losses

(35,989

)

-

Group relief

(58

)

-

Total tax charge/(credit)

41,431

(31,588

)