Ayrenergy Ltd - Accounts to registrar (filleted) - small 18.2

REGISTERED NUMBER: SC363794 (Scotland)

Unaudited Financial Statements

for the Year Ended 31 August 2020

for

Ayrenergy Ltd

Page

Company Information

1

Balance Sheet

2

Notes to the Financial Statements

4

DIRECTORS:

N J Skea

Mrs L K Skea

W J H Kirkness

SECRETARY:

Mrs L K Skea

REGISTERED OFFICE:

Barns of Ayre

Deerness

Orkney

KW17 2QJ

REGISTERED NUMBER:

SC363794 (Scotland)

ACCOUNTANTS:

Foubister & Bain

4 Broad Street

Kirkwall

Orkney

KW15 1NX

FIXED ASSETS

3,627,266

Tangible assets

4

3,367,190

CURRENT ASSETS

174,055

Debtors

5

195,230

1,243,260

Cash at bank

1,267,580

1,417,315

1,462,810

CREDITORS

521,321

Amounts falling due within one year

6

581,045

895,994

NET CURRENT ASSETS

881,765

4,523,260

TOTAL ASSETS LESS CURRENT LIABILITIES

4,248,955

CREDITORS

(2,682,428

)

Amounts falling due after more than one year

7

(2,357,587

)

(229,347

)

PROVISIONS FOR LIABILITIES

(284,194

)

1,611,485

NET ASSETS

1,607,174

CAPITAL AND RESERVES

780,394

Called up share capital

630,394

259,872

Capital Redemption Reserve

409,872

571,219

Retained earnings

566,908

1,611,485

SHAREHOLDERS' FUNDS

1,607,174

The company is entitled to exemption from audit under Section 477 of the Companies Act 2006 for the year ended 31 August 2020.

The members have not required the company to obtain an audit of its financial statements for the year ended 31 August 2020 in accordance with Section 476 of the Companies Act 2006.

The directors acknowledge their responsibilities for:

(a)	ensuring that the company keeps accounting records which comply with Sections 386 and 387 of the Companies Act 2006 and

(b)

preparing financial statements which give a true and fair view of the state of affairs of the company as at the end of each financial year and of its profit or loss for each financial year in accordance with the requirements of Sections 394 and 395 and which otherwise comply with the requirements of the Companies Act 2006 relating to financial statements, so far as applicable to the company.

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

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

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

N J Skea - Director

1.	STATUTORY INFORMATION

Ayrenergy Ltd is a private company, limited by shares , registered in Scotland. The company's registered number and registered office address can be found on the Company Information page.

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

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

Turnover

Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

Turnover relates to the sale of electricity and related income and 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 not recognised until the significant risks and rewards of ownership of the electricity have passed to the buyer and the amount of revenue can be readily ascertained.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.

Wind Turbine

5 % on cost - Straight line

Plant and Machinery

25% on cost - Straight line

Depreciation will be provided from the first month after the date of commissioning of the wind turbine in order to write off the asset over its estimated useful life.

Financial instruments

The company has elected to apply the provisions of Section 11 'Basic Financial Instruments' of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally 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.

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method 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. Financial assets classified as receivable within one year are not amortised.

Classification of financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Basic financial liabilities

Basic financial liabilities, including creditors 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 payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

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

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts 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 creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Deferred tax

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

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

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

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

3.	EMPLOYEES AND DIRECTORS

The average number of employees during the year was 7 (2019 - NIL ) .

4.	TANGIBLE FIXED ASSETS

Land,

buildings

Plant and

and

machinery

Totals

turbines

etc

£

£

£

COST

At 1 September 2019

and 31 August 2020

5,202,240

5,201,516

724

DEPRECIATION

At 1 September 2019

1,574,974

1,574,250

724

Charge for year

260,076

260,076

-

At 31 August 2020

1,835,050

1,834,326

724

NET BOOK VALUE

At 31 August 2020

3,367,190

3,367,190

-

At 31 August 2019

3,627,266

3,627,266

-

Included in the above are finance charges, including interest and bank charges amounting to £170,261 at cost. (2019 - £170,261)

5.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2020

2019

£

£

Trade debtors

180,278

159,144

Other debtors

14,952

14,911

195,230

174,055

6.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2020

2019

£

£

Bank loans and overdrafts

299,841

282,505

Trade creditors

28,653

7,559

Taxation

22,047

25,998

Other creditors

230,504

205,259

581,045

521,321

7.

CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR

2020

2019

£

£

Bank loans

2,332,587

2,632,428

Other creditors

25,000

50,000

2,357,587

2,682,428

Amounts falling due in more than five years:

Repayable by instalments

Operating Loan C

1,095,898

1,369,290

The creditor of £25,000 represents loans by participants as at 31 August 2020 (2019 - £50,000).

8.	SECURED DEBTS

The following secured debts are included within creditors:

2020

2019

£

£

Bank loans

2,632,428

2,914,933

The bank loan is secured by a bond and floating charge over the whole assets of the company. The bank also has a non-residential mortgage over the lease at the Barns of Ayre site.

9.	CONTINGENT LIABILITIES

The company has contingent liabilities in connection with guarantees and assurances provided in connection with financial and other arrangements associated with the construction of the windfarm.

10.	OTHER FINANCIAL COMMITMENTS

The company has entered into a lease agreement with the landowner Norrian Limited, on whose land the wind turbines are situated.

Annual commitments under the terms of the lease are calculated as 6% of the gross turnover per annum.

Payments due under the terms of the lease during the year amounted to £68,524 (2019 - £55,576). The sum due to Norrian Limited, a related company at 31 August 2020 was £214,674 (2019 - £185,983).

11.	DIRECTORS' ADVANCES, CREDITS AND GUARANTEES

At 31 August 2019 the company had loans of £25,000 from Mr & Mrs Norman Skea together with a further loan of £25,000 from Mr & Mrs W Kirkness. (2018 - £50,000).