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Registered number: 11204889
SCC AUDIO LIMITED
FINANCIAL STATEMENTS
INFORMATION FOR FILING WITH THE REGISTRAR
FOR THE YEAR ENDED 31 JULY 2021
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SCC AUDIO LIMITED
REGISTERED NUMBER: 11204889
STATEMENT OF FINANCIAL POSITION
AS AT 31 JULY 2021
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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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SCC AUDIO LIMITED
REGISTERED NUMBER: 11204889
STATEMENT OF FINANCIAL POSITION (CONTINUED)
AS AT 31 JULY 2021
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 income and retained earnings 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 25 May 2022.
The notes on pages 3 to 10 form part of these financial statements.
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SCC AUDIO LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2021
SCC Audio Limited is a private company limited by shares and registered in England and Wales. The address of its registered office and principal place of business is Unit 11 Torc:Mk, Chippenham Drive, Kingston, Milton Keynes, England, MK10 0BZ.
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 following principal accounting policies have been applied:
The company shows net current liabilities at the reporting date of £934,859 (2020: £529,123 and net liabilities of £677,863 (2020: £409,324). The company has received formal confirmation from its immediate parent, Studioking Sound & Instrument (Asia) Limited, that the company will receive the financial support it requires to enable it to meet its liabilities as they fall due.
There is less likely impact on the delays of imports from China due to the lift of restriction of COVID-19. The directors have a reasonable expectation that due the llifting of covid restrictions this will improve the company's financial results due to the return of live productions and concerts.
Existing funding facilities, forecasts and projections indicate that the company has adequate resources to continue with some level of activity from a minimal to full levels.
After reviewing the company's forecasts and projections, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. The company therefore continues to adopt the going concern basis in preparing its financial statements, but with the proviso that a material uncertainly exists over the company’s future.
In making their assessment of going concern, the director has considered information for a period of at least twelve months from the date the financial statements were authorised for issue.
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Foreign currency translation
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Functional and presentation currency
The company's functional and presentational currency is GBP.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
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SCC AUDIO LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2021
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.
Sale of audio equipment
Revenue from the sale of audio equipment is recognised when the significant risks and rewards of ownership of the goods transfer to the customer, which is considered to be the point of dispatch.
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Operating leases: the company as 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.
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.
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.
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 Income and Retained Earnings in the same period as the related expenditure.
During the year the company received employee based government grants.
Interest income is recognised in profit or loss using the effective interest method.
Finance costs are charged to profit or loss 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.
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SCC AUDIO LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2021
2.Accounting policies (continued)
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.
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.
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.
The estimated useful lives range as follows:
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Not amortised until brought into use
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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.
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SCC AUDIO LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2021
2.Accounting policies (continued)
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Tangible fixed assets (continued)
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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.
Depreciation is provided on the following basis:
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 profit or loss.
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 out basis. 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 profit or loss.
Short term debtors are measured at transaction price, less any impairment.
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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.
Short term creditors are measured at the transaction price.
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 and loans to related parties.
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The average monthly number of employees, including directors, during the year was 18 (2020 - 24).
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SCC AUDIO LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2021
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SCC AUDIO LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2021
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Charge for the year on owned assets
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SCC AUDIO LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2021
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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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Accruals and deferred income
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SCC AUDIO LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2021
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Creditors: Amounts falling due after more than one year
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The aggregate amount of liabilities repayable wholly or in part more than five years after the reporting date is:
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The bank loan is interest bearing at 2.5% per annum and is guaranteed under the UK government-backed coronavirus business support measures.
The company operates a defined contribution scheme. The assets of the scheme are held separately from those of the company in an independently administered fund. Contributions totalling £6,226 (2020: £2,659) were payable to the fund at the reporting date and are included in creditors.
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Related party transactions
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The ultimate parent company is Soundking Electronics and Sound Co, Ltd. The ultimate controlling party is Mr Xianggui Wang.
The company has taken advantage of the exemption in FRS 102 from the requirement to disclose transactions with group companies on the grounds that the company is a wholly owned subsidiary.
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The auditors' report on the financial statements for the year ended 31 July 2021 was unqualified.
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In their report, the auditors emphasised the following matter without qualifying their report:
The company has net liabilities of £677,863, as stated in note 2.2, these events or conditions, along with the other matters as set forth in note 2.2, indicate that a material uncertainty exists that may cast significant doubt on the company's ability to continue as a going concern. Our opinion is not modified in respect of this matter.
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The audit report was signed on 26 May 2022 by Richard Paul (Senior Statutory Auditor) on behalf of Nyman Libson Paul LLP.
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