Electraweld Limited - Accounts to registrar (filleted) - small 18.2

REGISTERED NUMBER: 02654335 (England and Wales)

ELECTRAWELD LIMITED

UNAUDITED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2021

Page

Company Information

1

Statement of Financial Position

2

Notes to the Financial Statements

4

DIRECTORS:

Mr A A Westcott

Mr D A Liddle

SECRETARY:

Mrs V M Westcott

REGISTERED OFFICE:

Bank Chambers

1 Central Avenue

Sittingbourne

Kent

ME10 4AE

REGISTERED NUMBER:

02654335 (England and Wales)

ACCOUNTANTS:

McCabe Ford Williams

Chartered Accountants

Bank Chambers

1 Central Avenue

SITTINGBOURNE

Kent

ME10 4AE

BANKERS:

National Westminster

Chatham Branch

148 High Street

Chatham

Kent

ME4 4DJ

FIXED ASSETS

Intangible assets

5

-

-

Tangible assets

6

53,344

65,089

53,344

65,089

CURRENT ASSETS

Stocks

80,164

81,536

Debtors

7

330,718

298,020

Cash at bank

101,575

113,026

512,457

492,582

CREDITORS

Amounts falling due within one year

8

344,039

346,633

NET CURRENT ASSETS

168,418

145,949

TOTAL ASSETS LESS CURRENT LIABILITIES

221,762

211,038

CREDITORS

Amounts falling due after more than one year

9

(44,099

)

(62,448

)

PROVISIONS FOR LIABILITIES

(9,776

)

(9,029

)

NET ASSETS

167,887

139,561

CAPITAL AND RESERVES

Called up share capital

12

103

103

Retained earnings

167,784

139,458

SHAREHOLDERS' FUNDS

167,887

139,561

The company is entitled to exemption from audit under Section 477 of the Companies Act 2006 for the year ended 31 December 2021.

The members have not required the company to obtain an audit of its financial statements for the year ended 31 December 2021 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 28 September 2022 and were signed on its behalf by:

Mr A A Westcott - Director

1.	STATUTORY INFORMATION

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

The presentation currency of the financial statements is the Pound Sterling (£).

The business address is Unit 1, Loaland Business Centre, Maritime Close, Rochester ME2 4AZ.

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" including the provisions of Section 1A "Small Entities" 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.

The company meets its day to day working capital requirements through a bank overdraft facility which is repayable on demand. The director expects this facility to continue for the foreseeable future and therefore considers it appropriate to prepare the financial statements on the going concern basis. The financial statements do not include any adjustment that would result from a withdrawal of the overdraft facility by the company's bankers.

Significant judgements and estimates

In the application of the company's accounting policies, management is required to make judgements, estimates and assumptions about the carrying value of assets and liabilities that are not readily apparent from other sources. The estimates and underlying assumptions are based on historical experience and other factors that are considered relevant. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period to which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods. The key sources of estimation uncertainty that have a significant effect on the amounts recognised in the financial statements are the depreciation charges that are calculated with reference to the useful economic life of fixed assets.

Turnover

Turnover represents the value, net of value added tax and discounts, relating to the sale and hire of welding equipment.

Goodwill

Goodwill, being the amount paid in connection with the purchase of the business is fully amortised.

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.

Tangible fixed assets

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

Improvements to property

-

over remaining term of lease

Plant and machinery

-

15% on reducing balance

Fixtures and fittings

-

15% on reducing balance

Motor vehicles

-

25% on reducing balance

Computer equipment

-

25% on cost

Government grants

Government grants are recognised when the performance related conditions imposed upon the receipt of the grant have been met. Where these a have not been satisfied, these grants are recognised as liabilities. If grants are not conditional on future performance related conditions, then income is recognised when the grant proceeds are receivable. During the year the company received the following grants:

Coronavirus Job Retention Scheme (CJRS) to cover a portion of employees' wages who were furloughed due to the coronavirus pandemic.

Employment allowance to contribute towards the Employers National Insurance costs of employing staff

A grant to cover the first year's interest on the Government backed Bounce Back Loan taken out during the year.

Stocks

Stock is valued at the lower of cost and net realisable value using the FIFO standard method, after making due allowance for obsolete and slow moving items.

Financial instruments

The company enters into basic financial instruments that result in the recognition of financial assets and liabilities like trade and other accounts receivable and payable, loans from banks and other third parties and loans to related parties.

a) Trade and other debtors

Trade and other debtors are initially recognised at fair value and thereafter stated at amortised cost using the effective interest method, less impairment losses for bad and doubtful debts except where the effect of discounting would be immaterial. In such cases, the receivables are stated at cost less impairment losses for bad and doubtful debts.

b) Cash and cash equivalents

Cash and cash equivalents comprise cash at bank and in hand.

c) Impairment of financial assets

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 profit or loss.

For financial assets measured at amortised cost, the impairment loss is measured as the difference between an asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If a financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract.

For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount and the best estimate, 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.

d) Trade and other creditors

Debt instruments like loans and other accounts receivable and payable are initially measured at present value of the future payments and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade payables or receivables, 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 financed at a rate of interest that is not a market rate or in case of an outright short-term loan not at market rate, the financial asset or liability is measured, initially and subsequently, at the present value of the future payments discounted at a market rate of interest for a similar debt instrument.

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.

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 statement of financial position date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position 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.

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 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 to the company's pension scheme are charged to profit or loss in the period to which they relate.

Impairment of non-financial assets

At each reporting date non-financial assets not carried at fair value, like plant and equipment, are reviewed to determine whether there is an indication that an asset may be impaired. If there is an indication of possible impairment, the recoverable amount of any asset or group of related assets, which is the higher of value in use and the fair value less cost to sell, is estimated and compared with its carrying amount. If the recoverable amount is lower, the carrying amount of the asset is reduced to its recoverable amount and an impairment loss is recognised immediately in profit and loss.

Inventories are also assessed for impairment at each reporting date. Each item of inventory is compared to the last sold date and an impairment loss recognised on a percentage basis in profit and loss.

If an impairment loss is subsequently reversed, the carrying amount of the asset or group of related assets is increased to the revised estimate of its recoverable amount, but not to exceed the amount that would have been determined had no impairment loss been recognised for the asset or group of related assets in prior periods. A reversal of an impairment loss is recognised immediately in profit and loss.

4.	EMPLOYEES AND DIRECTORS

The average number of employees during the year was 6 (2020 - 7 ) .

5.	INTANGIBLE FIXED ASSETS

Goodwill

£

COST

At 1 January 2021

and 31 December 2021

95,000

AMORTISATION

At 1 January 2021

and 31 December 2021

95,000

NET BOOK VALUE

At 31 December 2021

-

At 31 December 2020

-

6.	TANGIBLE FIXED ASSETS

Improvements

Fixtures

to

Plant and

and

property

machinery

fittings

£

£

£

COST

At 1 January 2021

37,850

1,305

35,700

Additions

-

-

260

At 31 December 2021

37,850

1,305

35,960

DEPRECIATION

At 1 January 2021

21,160

973

32,394

Charge for year

3,295

50

509

At 31 December 2021

24,455

1,023

32,903

NET BOOK VALUE

At 31 December 2021

13,395

282

3,057

At 31 December 2020

16,690

332

3,306

Motor

Computer

vehicles

equipment

Totals

£

£

£

COST

At 1 January 2021

66,758

33,872

175,485

Additions

-

4,288

4,548

At 31 December 2021

66,758

38,160

180,033

DEPRECIATION

At 1 January 2021

25,174

30,695

110,396

Charge for year

10,396

2,043

16,293

At 31 December 2021

35,570

32,738

126,689

NET BOOK VALUE

At 31 December 2021

31,188

5,422

53,344

At 31 December 2020

41,584

3,177

65,089

Fixed assets, included in the above, which are held under hire purchase contracts are as follows:

Motor

vehicles

£

COST

At 1 January 2021

and 31 December 2021

56,505

DEPRECIATION

At 1 January 2021

16,450

Charge for year

10,014

At 31 December 2021

26,464

NET BOOK VALUE

At 31 December 2021

30,041

At 31 December 2020

40,055

7.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

31.12.21

31.12.20

£

£

Trade debtors

326,696

293,995

Other debtors

4,022

4,022

Directors' current accounts

-

3

330,718

298,020

8.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

31.12.21

31.12.20

£

£

Bank loans and overdrafts

9,607

5,000

Hire purchase contracts (see note 10)

9,813

9,438

Trade creditors

232,420

160,740

Other taxes and paye

23,040

26,286

VAT

12,214

23,630

Other creditors

16,810

3,260

Factoring account

-

86,032

Accrued expenses

6,618

23,072

Directors' current accounts

33,517

9,175

344,039

346,633

9.

CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR

31.12.21

31.12.20

£

£

Bank loans - 1-2 years

9,850

10,000

Bank loans - 2-5 years

26,614

30,000

Bank loans more 5 yr by instal

-

5,000

Hire purchase contracts (see note 10)

7,635

17,448

44,099

62,448

Amounts falling due in more than five years:

Repayable by instalments

Bank loans more 5 yr by instal

-

5,000

10.	LEASING AGREEMENTS

Minimum lease payments fall due as follows:

Hire purchase contracts

31.12.21

31.12.20

£

£

Net obligations repayable:

Within one year

9,813

9,438

Between one and five years

7,635

17,448

17,448

26,886

Non-cancellable operating

leases

31.12.21

31.12.20

£

£

Within one year

12,250

12,250

Between one and five years

6,410

18,660

18,660

30,910

11.	SECURED DEBTS

The following secured debts are included within creditors:

31.12.21

31.12.20

£

£

Factoring account

-

86,032

The factoring account is secured by way of a fixed and floating charge over all assets of the company. Furthermore, there is a mortgage debenture in place over leasehold properties.

During the year, the company closed the factoring account and is currently awaiting the removal of the fixed and floating charges.

12.	CALLED UP SHARE CAPITAL

Allotted, issued and fully paid:

Number:

Class:

Nominal

31.12.21

31.12.20

value:

£

£

400

Ordinary 'A'

25p

100

100

10

Ordinary 'B'

25p

3

3

103

103

Ordinary 'A' shares have equal voting rights

Ordinary 'B' shares have a right to receive notice of and attend at general meetings of the company, but no right to vote; no rights to a share of assets on liquidation; no rights of redemption and a right to receive a dividend and be considered separately by the directors of the company in deciding whether a dividend should be paid.