JUST_TRADING_SCOTLAND_LIM - Accounts

The directors present their annual report and financial statements for the year ended 31 January 2022.

Sales rose 14.9% to £371,555 from £323,232 in 2021, with gross profit increasing from £110,265 to £144,311 with a gross profit percentage of 38% (2021 34%). Following the development of the five year strategic plan in 2020, we have been focussed on ensuring that JTS becomes a stable, trading organisation, working in line with its mission and operating sustainably. Our work remains driven by our desire to support disadvantaged producers and suppliers. Our Board continues to monitor progress against our business plan through KPI reports and meets at least quarterly to consider risks and other matters of governance and to review the overall financial status of the organisation.

2021 was clearly another very challenging year for everyone, with COVID-19 and resulting global supply chain issues continuing to cause disruption to our imports and sales. Whilst ongoing restrictions continued to limit sales through churches and schools, shop customers generally saw a good Christmas season as customers sought ethical presents available locally. We continued to see good sales to those customers who have a strong online presence themselves and also to individuals through our own online shop. With the relaxation of some restrictions, we were able to increase our staff presence on site and have gradually moved to hybrid working. With support from the Young Person’s Guarantee scheme, we expanded the team in April 2021 with the creation of a sales support role. Following a review of the operations roles, in October 2021 we appointed a Logistics and Quality Co-ordinator to work with our Operations Manager. During the year we introduced a range of Organic pulses from Nature Bio in India, supported by a series of “cook-along” events in conjunction with the Fairtrade Foundation’s National Campaigner Committee. We extended the range of Beer Bread from BarretsRidge in South Africa and at the year-end launched new products from Ma's in Sri Lanka to complement the coconut milk.

As our producer partners continued to struggle with COVID-19 in their own countries, we shared updates with our supporters asking them to join us in “standing with producers”. Jointly with Gavin’s Mill and the Balmore Trust, we hosted the first of series of online meetings to hear from our producer partners about the work they are doing in their local communities. This first event focused on the work of the Woman Farmer Foundation of Eswatini.

During the COP26 climate conference in November, we emphasised the need for ambitious climate aims to go hand in hand with trade justice goals. We focused on “Respect for the Environment” – one of the ten fair trade principles which JTS adheres to as a WFTO (World Fair Trade Organization) Guaranteed Member and one that is increasing in importance as the extent of the climate emergency becomes ever clearer.

Whilst this is the first time sales have exceeded £350k, marking another key milestone in JTS's growth, sales were again below budget mainly due to the lack of new listings through 2021. This was despite having new business development work ongoing from June 2021, leading to a further review of our approach and ambitions in terms of new business for 2022.

We received further support from the Trust as well as donations and small grants from various other sources. These totalled £72k in the year and once again were material in allowing JTS to remain viable. In addition, we were very pleased to receive £74k from the Adapt & Thrive (Covid Recovery Fund) in May 2021. This grant has been crucial as we have adapted our business model to respond to the new economic context, in particular allowing us to invest in staffing and systems enhancements as well as supporting marketing.

The grant and donation income, combined with increasing sales, enabled JTS to end the year in profit again and to make a donation to The Balmore Trust of £509.

Development work continues in Malawi through a number of small projects run by the Balmore Trust. We were very pleased when KASFA achieved WFTO status through one of these projects and encouraged when Grace’s Briquette Project (seeking to make fuel briquettes from rice husks) was awarded the Climate Partnership Award at the Scottish Fair Trade Forum (SFTF) awards ceremony in November. In addition, as JTS we secured a small grant from SFTF to support Meru Herbs in applying for Provisional membership of WFTO, a project we hope will be followed by work on a Guaranteed Member status project in 2022.

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

This report has been prepared in accordance with the provisions applicable to companies entitled to the small companies exemption.

In order to assist you to fulfil your duties under the Companies Act 2006, we have prepared for your approval the financial statements of Just Trading Scotland Limited for the year ended 31 January 2022 which comprise the profit and loss account, the balance sheet and the related notes from the company’s accounting records and from information and explanations you have given us.

As a practising member firm of the ICAS we are subject to its ethical and other professional requirements which are detailed at https://icas.com/icas-framework-preparation-of-accounts

Our work has been undertaken solely to prepare for your approval the financial statements of Just Trading Scotland Limited and state those matters that we have agreed to state to the Board of Directors of Just Trading Scotland Limited, as a body, in this report in accordance with the requirements of the ICAS as detailed at https://icas.com/icas-framework-preparation-of-accounts. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than Just Trading Scotland Limited and its Board of Directors as a body, for our work or for this report.

It is your duty to ensure that Just Trading Scotland Limited has kept adequate accounting records and to prepare statutory financial statements that give a true and fair view of the assets, liabilities, financial position and result of Just Trading Scotland Limited. You consider that Just Trading Scotland Limited is exempt from the statutory audit requirement for the year.

We have not been instructed to carry out an audit or a review of the financial statements of Just Trading Scotland Limited. For this reason, we have not verified the accuracy or completeness of the accounting records or information and explanations you have given to us and we do not, therefore, express any opinion on the statutory financial statements.

The profit and loss account has been prepared on the basis that all operations are continuing operations.

The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true

For the financial year ended 31 January 2022 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.

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 members have not required the company to obtain an audit of its financial statements for the year in question in accordance with section 476.

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

Just Trading Scotland Limited is a private company limited by shares incorporated in Scotland. The registered office is Unit 4, Greenlaw Industrial Estate, Wallneuk Road, Paisley, UK, PA3 4BT.

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The company will continue to be supported by the Balmore Trust and the JTS Directors having considered this and made due enquiries, continue to adopt the going concern basis in preparing the financial statements which assumes that the company will continue in operation for the foreseeable future. true

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.

Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ 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, 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.

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, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, 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.

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be 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 in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

The average monthly number of persons (including directors) employed by the company during the year was: