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Sound Leisure Limited
Registered number: 01342898
Information for filing with the Registrar
For the year ended 30 April 2020
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SOUND LEISURE LIMITED
REGISTERED NUMBER: 01342898
STATEMENT OF FINANCIAL POSITION
AS AT 30 APRIL 2020
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Debtors: amounts falling due after more than one year
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Creditors: amounts falling due after more than one year
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Provisions for liabilities
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- 1 -
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SOUND LEISURE LIMITED
REGISTERED NUMBER: 01342898
STATEMENT OF FINANCIAL POSITION (CONTINUED)
AS AT 30 APRIL 2020
The directors consider that the Company is entitled to exemption from audit under section 477 of the Companies Act 2006 and members have not required the Company to obtain an audit for the year in question in accordance with section 476 of the Companies Act 2006.
The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.
The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime and in accordance with the provisions of FRS 102 Section 1A - small entities.
The financial statements have been delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The Company has opted not to file the statement of comprehensive income in accordance with provisions applicable to companies subject to the small companies' regime.
The financial statements were approved and authorised for issue by the board and were signed on its behalf on 30 April 2021.
The notes on pages 3 to 16 form part of these financial statements.
- 2 -
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SOUND LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2020
Sound Leisure Limited (the "Company") is a private Company, limited by shares, registered in England and Wales, registered number 01342898. The registered office and principal place of business is Sandleas Way, Leeds, LS15 8AR.
The principal activity of the Company is the production of jukeboxes.
These financial statements have been presented in pound sterling which is the functional currency of the Company, and rounded to the nearest £.
2.Accounting policies
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Basis of preparation of financial statements
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The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Section 1A of Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The Company has adopted the triennial review of FRS 102 effective for periods commencing on or after 1 January 2019.
Information in respect of the differences from the previous accounting framework are detailed within note 19.
The following principal accounting policies have been applied:
The directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. Thus they continue to adopt the going concern basis for accounting in preparing the annual financial statements. The directors have considered a period in excess of twelve months from the date of approval of these financial statements in making their assessment. The Company has benefitted from the Coronavirus Job Retention Scheme and Coronavirus Business Interruption Loan Scheme.
Potential sources of uncertainty noted by the directors include the withdrawal of the United Kingdom from the European Union, and Coronavirus and the COVID-19 pandemic. However at the date of this report is it not possible to reliably determine the effects that these developments will have on the Company. Accordingly the directors have continued to prepare the financial statements on the going concern basis.
- 3 -
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SOUND LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2020
2.Accounting policies (continued)
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:
Sale of goods
Revenue from the sale of goods is recognised when all of the following conditions are satisfied:
∙the Company has transferred the significant risks and rewards of ownership to the buyer;
∙the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
∙the amount of revenue can be measured reliably;
∙it is probable that the Company will receive the consideration due under the transaction; and
∙the costs incurred or to be incurred in respect of the transaction can be measured reliably.
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Operating leases: the Company as a lessee
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Rentals paid under operating leases are charged to profit or loss on a straight line basis over the lease term.
Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.
In the research phase of an internal project it is not possible to demonstrate that the project will generate future economic benefits and hence all expenditure on research shall be recognised as an expense when it is incurred. Intangible assets are recognised from the development phase of a project if and only if certain specific criteria are met in order to demonstrate the asset will generate probable future economic benefits and that its cost can be reliably measured. The capitalised development costs are subsequently amortised on a straight line basis over their useful economic lives, which range from 3 to 6 years.
If it is not possible to distinguish between the research phase and the development phase of an internal project, the expenditure is treated as if it were all incurred in the research phase only.
- 4 -
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SOUND LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2020
2.Accounting policies (continued)
Grants are accounted under the accruals model as permitted by FRS 102. Grants relating to expenditure on tangible fixed assets are credited to profit or loss at the same rate as the depreciation on the assets to which the grant relates. The deferred element of grants is included in creditors as deferred income.
Grants of a revenue nature are recognised in the Statement of Comprehensive Income in the same period as the related expenditure.
The UK Government has offered a range of financial support packages to help companies during the COVID-19 Coronavirus pandemic, including government backed financing arrangements, furlough schemes, deferment of VAT payments and, for some sectors, business rates holidays. Of the offered schemes, the Company has used the furlough scheme and a government backed financing arrangement. The income from the furlough scheme has been recognised within 'Other operating income'. Government grants are recognised when the entity has reasonable assurance that they will comply with the conditions attaching the grant, and that the grant will be received.
Finance costs are charged to the Statement of Comprehensive Income over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.
All borrowing costs are recognised in profit or loss in the year in which they are incurred.
Defined contribution pension plan
The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of Financial Position. The assets of the plan are held separately from the Company in independently administered funds.
- 5 -
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SOUND LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2020
2.Accounting policies (continued)
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Current and deferred taxation
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The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company operates and generates income.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the Statement of Financial Position date, except that:
∙The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
∙Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.
Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.
Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.
All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.
Research and development expenditure is written off in the year in which it is incurred unless certain specific criteria are met in order to demonstrate that an asset has been developed which will generate probable future economic benefits and that its cost can be reliably measured in which case an intangible asset is recognised in respect of the development phase of a project only.
The capitalised development costs are subsequently amortised on a straight line basis over their useful economic lives, which is 10 years.
- 6 -
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SOUND LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2020
2.Accounting policies (continued)
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight line method or on a reducing balance basis where appropriate.
Depreciation is provided on the following basis:
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Over 2 - 5 years straight line as appropriate
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20% & 33.3% straight line
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The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the Statement of Comprehensive Income.
Investments in subsidiaries are measured at cost less accumulated impairment.
Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first outbasis. Work in progress and finished goods include labour and attributable overheads.
At each reporting date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in the Statement of Comprehensive Income.
Short term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
- 7 -
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SOUND LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2020
2.Accounting policies (continued)
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Cash and cash equivalents
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Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.
Short term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
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Provisions for liabilities
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Provisions are made where an event has taken place that gives the Company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.
Provisions are charged as an expense to profit or loss in the year that the Company becomes aware of the obligation, and are measured at the best estimate at the Statement of Financial Position date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.
When payments are eventually made, they are charged to the provision carried in the Statement of Financial Position.
- 8 -
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SOUND LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2020
2.Accounting policies (continued)
The Company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of an out-right short-term loan that is not at market rate, the financial asset or liability is measured, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost, unless it qualifies as a loan from a director in the case of a small company, or a public benefit entity concessionary loan.
Financial assets that are measured at cost and amortised cost 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 the Statement of Comprehensive Income.
For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount and best estimate of the recoverable amount, which is an approximation of the amount that the Company would receive for the asset if it were to be sold at the reporting date.
Financial assets and liabilities are offset and the net amount reported in the Statement of Financial Position when there is an enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting.
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The average monthly number of employees, including directors, during the year was 82 (2019 - 83).
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- 9 -
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SOUND LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2020
- 10 -
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SOUND LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2020
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Charge for the year on owned assets
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Charge for the year on financed assets
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The net book value of assets held under finance leases or hire purchase contracts, included above, are as follows:
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- 11 -
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SOUND LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2020
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Investments in subsidiary companies
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The following was a subsidiary undertaking of the Company:
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Dawson's Pattern Works Limited
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Raw materials and consumables
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Finished goods and goods for resale
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- 12 -
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SOUND LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2020
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Due after more than one year
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Prepayments and accrued income
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Creditors: Amounts falling due within one year
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Amounts owed to group undertakings
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Other taxation and social security
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Obligations under finance lease and hire purchase contracts
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Accruals and deferred income
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The bank overdraft is secured by a fixed and floating charge over the assets of the Company, dated July 2004 and by a cross guarantee with Sound Leisure Holdings Limited by way of a mortgage with Natwest Bank PLC which contains a fixed and floating charge over the property or undertaking of Sound Leisure Holdings Limited.
Hire purchase liabilities are secured on the assets to which the contracts relate.
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- 13 -
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SOUND LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2020
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Creditors: Amounts falling due after more than one year
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Net obligations under finance leases and hire purchase contracts
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Amounts owed to group undertakings
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Charged to profit or loss
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The provision for deferred taxation is made up as follows:
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Accelerated capital allowances
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Losses and other deductions
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Allotted, called up and fully paid
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850 (2019 - 850) A Ordinary shares of £1 each
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2,550 (2019 - 2,550) B Ordinary shares of £1 each
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850 (2019 - 850) C Ordinary shares of £1 each
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850 (2019 - 850) D Ordinary shares of £1 each
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- 14 -
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SOUND LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2020
Share premium account
This reserve represents the amounts received in regard to the Company's shares above their par value.
Profit & loss account
This reserve represents cumulative profits and losses made by the Company to date less dividends distributed to shareholders
The Company operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the Company in an independently administered fund. The pension cost charge represents contributions payable by the Company to the fund and amounted to £48,347 (2019: £40,804). Contributions totalling £3,963 (2019: £1,664) were payable to the fund at the Statement of Financial Position date and are included in creditors.
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Commitments under operating leases
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At 30 April 2020 the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:
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Later than 1 year and not later than 5 years
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- 15 -
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SOUND LEISURE LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 APRIL 2020
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Related party transactions
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The Company is a wholly owned subsidiary of Sound Leisure Holdings Limited.
The Company has made payments on behalf of Sound Leisure Holdings Limited totalling £168,900 (2019: £197,400).
Sound Leisure Limited has a related director in Team Vacform Limited. During the year the Company incurred purchases of £52,300 (2019: £69,782) for materials, and also received income of £10,814 (2019: 12,069).
Amounts due (to)/ from related parties at the year end date are shown below:
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Sound Leisure Holdings Limited
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Dawson's Pattern Works Limited
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Economic impact of the COVID-19 pandemic
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The COVID-19 pandemic continues to affect the UK and global economies adversely. At the time of signing this report there are indications from the government that social restrictions which have suppressed economic activity during 2020 and 2021 are likely to be lifted in the foreseeable future. If this does happen the directors expect to see the UK economy return to growth in due course, but it is not possible to predict how quickly and to what degree this may happen. The priorities of the directors remain to comply with all regulatory requirements to the fullest extent possible, and to maintain the safety and well-being of the Company's personnel.
The Company is a wholly owned subsidiary of Sound Leisure Holdings Limited.
Sound Leisure Holdings Limited is controlled by the directors who hold 100% of the issued share capital.
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Adoption of the triennial review of FRS102
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The policies applied under the entity's previous accounting framework are not materially different to the triennial review of FRS 102 and have not impacted on equity or profit or loss.
- 16 -
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