Company No: SC391006 (Scotland)

Contents

• Balance Sheet
• Notes to the Financial Statements

	Note	2022		2021
		£		£
Fixed assets
Tangible assets	3	1,281,759		1,435,703
Investments	4	104		104
		1,281,863		1,435,807
Current assets
Stocks	5	212,364		322,481
Debtors	6	184,238		216,377
Cash at bank and in hand		2,320,572		1,835,313
		2,717,174		2,374,171
Creditors
Amounts falling due within one year	7	( 937,131)		( 948,759)
Net current assets		1,780,043		1,425,412
Total assets less current liabilities		3,061,906		2,861,219
Creditors
Amounts falling due after more than one year	8	0		( 17,973)
Provision for liabilities	9	( 182,379)		( 147,014)
Net assets		2,879,527		2,696,232
Capital and reserves
Called-up share capital	10	2		2
Profit and loss account		2,879,525		2,696,230
Total shareholders' funds		2,879,527		2,696,232

For the financial year ending 31 March 2022 the Company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.

Directors' responsibilities:

• The members have not required the Company to obtain an audit of its financial statements for the financial year in accordance with section 476;
• 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; and
• These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime and a copy of the Statement of Income and Retained Earnings has not been delivered.

The financial statements of Balquhain Farming Limited (registered number: SC391006) were approved and authorised for issue by the Director on 20 December 2022. They were signed on its behalf by:

Mark Strachan Director

Nicola Strachan Director

1. Accounting policies

The principal accounting policies are summarised below. They have all been applied consistently throughout the financial year and to the preceding financial year, unless otherwise stated.

General information and basis of accounting

Balquhain Farming Limited (the Company) is a private company, limited by shares, incorporated in the United Kingdom under the Companies Act 2006 and is registered in Scotland. The address of the Company's registered office is Commerce House, South Street, Elgin, IV30 1JE, United Kingdom.

The financial statements have been prepared under the historical cost convention, modified to include certain items at fair value, and in accordance with Section 1A of Financial Reporting Standard 102 (FRS 102) ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland’ issued by the Financial Reporting Council and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime.

The financial statements are presented in pounds sterling which is the functional currency of the company and rounded to the nearest £.

Going concern

The directors have assessed the Balance Sheet and likely future cash flows at the date of approving these financial statements. The directors have a reasonable expectation that the Company has adequate resources to continue in operational existence and to meet its financial obligations as they fall due for at least 12 months from the date of signing these financial statements. Accordingly, they continue to adopt the going concern basis in preparing the financial statements.

Foreign currency

Transactions in foreign currencies are recorded at the rate of exchange at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the Balance Sheet date are reported at the rates of exchange prevailing at that date.

Exchange differences are recognised in the Statement of Income and Retained Earnings in the period in which they arise except for exchange differences arising on gains or losses on non-monetary items which are recognised in the Statement of Comprehensive Income.

Turnover

Turnover represents amounts receivable for agricultural goods and services net of VAT. Turnover is recognised on delivery of goods and completion of services. Turnover comprises income received from the following sources:

Livestock sales are recognised at the point of supply.

Crop sales are recognised at the point of supply.

Wind energy income is recognised on an accruals basis as generation is performed.

Subsidy income is recognised on an accruals basis.

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 transactions can be measured reliably.

Employee benefits

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

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

Defined contribution schemes
The Company operates a defined contribution scheme. The amount charged to the Statement of Income and Retained Earnings in respect of pension costs and other post-retirement benefits is the contributions payable in the financial year. Differences between contributions payable in the financial year and contributions actually paid are included as either accruals or prepayments in the Balance Sheet.

Taxation

Current tax
Current tax is provided at amounts expected to be paid (or recoverable) using the tax rates and laws that have been enacted or substantively enacted at the Balance Sheet date.

Deferred tax
Deferred tax arises as a result of including items of income and expenditure in taxation computations in periods different from those in which they are included in the Company's financial statements. Deferred tax is provided in full on timing differences which result in an obligation to pay more or less tax at a future date, at the average tax rates that are expected to apply when the timing differences reverse, based on current tax rates and laws. Deferred tax assets and liabilities are not discounted.

The carrying amount of deferred tax assets are reviewed at each reporting date and a valuation allowance is set up against deferred tax assets so that the net carrying amount equals the highest amount that is more likely than not to be recovered based on current or future taxable profit.

Tangible fixed assets

Tangible fixed assets are stated at cost or valuation, net of depreciation and any provision for impairment. Depreciation is provided on all tangible fixed assets, other than investment property and freehold land, at rates calculated to write off the cost or valuation, less estimated residual value, of each asset on a straight-line or reducing balance basis over its expected useful life, as follows:

Leasehold improvements	10 % reducing balance
Plant and machinery	20 % reducing balance
Vehicles	20 % reducing balance
Other property, plant and equipment	20 years straight line

Residual value represents the estimated amount which would currently be obtained from disposal of an asset, after deducting estimated costs of disposal, if the asset were already of the age and in the condition expected at the end of its useful life.

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.

Leases

The Company as lessee
Assets held under finance leases, hire purchase contracts and other similar arrangements, which confer rights and obligations similar to those attached to owned assets, are capitalised as tangible fixed assets at the fair value of the leased asset (or, if lower, the present value of the minimum lease payments as determined at the inception of the lease) and are depreciated over the shorter of the lease terms and their useful lives. The capital elements of future lease obligations are recorded as liabilities, while the interest elements are charged to the Statement of Income and Retained Earnings over the period of the leases to produce a constant periodic rate of interest on the remaining balance of the liability.

Rentals under operating leases are charged on a straight-line basis over the lease term, even if the payments are not made on such a basis. Benefits received and receivable as an incentive to sign an operating lease are similarly spread on a straight-line basis over the lease term.

Impairment of assets

Assets, other than those measured at fair value, are assessed for indicators of impairment at each Balance Sheet date. If there is objective evidence of impairment, an impairment loss is recognised in the Statement of Income and Retained Earnings as described below.

Non-financial assets
At each balance sheet date, the company reviews its tangible and intangible 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). The recoverable amount of an asset is the higher of its fair value less costs to sell and its 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. 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. 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.

Fixed asset investments

Investments are recognised initially at fair value which is normally the transaction price excluding transaction costs. Subsequently, they are measured at fair value through profit or loss if the shares are publicly traded or their fair value can otherwise be measured reliably. Other investments are measured at cost less impairment.

Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to sell, which is equivalent to the net realisable value. Cost includes materials, direct labour and an attributable proportion of manufacturing overheads based on normal levels of activity. Cost is calculated using the FIFO (first-in, first-out) method. Provision is made for obsolete, slow-moving or defective items where appropriate.

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

Cash and cash equivalents are basic financial assets and include cash in hand and deposits held at call with banks.

Financial instruments

Financial assets and financial liabilities are recognised when the Company becomes a party to the contractual provisions of the instrument.

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.

Financial assets and liabilities are only offset in the Balance Sheet when, and only when there exists a legally enforceable right to set off the recognised amounts and the Company intends either 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.

Basic financial 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
Equity instruments issued by the Company are recorded at the fair value of cash or other resources received or receivable, net of direct issue costs. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the Company.

Government grants

Government grants are recognised based on the accrual model and are measured at the fair value of the asset received or receivable. Grants are classified as relating either to revenue or to assets. Grants relating to revenue are recognised in income over the period in which the related costs are recognised. Grants relating to assets are recognised over the expected useful life of the asset. Where part of a grant relating to an asset is deferred, it is recognised as deferred income.

Provisions

Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that the Company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the Balance Sheet date, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows (when the effect of the time value of money is material).

When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, a receivable is recognised as an asset if it is virtually certain that reimbursement will be received and the amount of the receivable can be measured reliably.

2. Employees

	2022		2021
	Number		Number
Monthly average number of persons employed by the Company during the year, including directors	4		7

3. Tangible assets

	Leasehold improve- ments		Plant and machinery		Vehicles		Other property, plant and equipment		Total
	£		£		£		£		£
Cost
At 01 April 2021	165,428		775,756		123,101		1,363,861		2,428,146
Additions	0		8,000		0		0		8,000
Disposals	0		( 14,773)		0		0		( 14,773)
At 31 March 2022	165,428		768,983		123,101		1,363,861		2,421,373
Accumulated depreciation
At 01 April 2021	58,119		410,076		90,159		434,089		992,443
Charge for the financial year	10,731		73,247		6,589		68,193		158,760
Disposals	0		( 11,589)		0		0		( 11,589)
At 31 March 2022	68,850		471,734		96,748		502,282		1,139,614
Net book value
At 31 March 2022	96,578		297,249		26,353		861,579		1,281,759
At 31 March 2021	107,309		365,680		32,942		929,772		1,435,703

4. Fixed asset investments

	Other investments		Total
	£		£
Carrying value before impairment
At 01 April 2021	104		104
At 31 March 2022	104		104
Provisions for impairment
At 01 April 2021	0		0
At 31 March 2022	0		0
Carrying value at 31 March 2022	104		104
Carrying value at 31 March 2021	104		104

5. Stocks

	2022		2021
	£		£
Livestock	0		137,910
Crops	181,047		151,581
Other stock	31,317		32,990
	212,364		322,481

6. Debtors

	2022		2021
	£		£
Trade debtors	12,271		8,719
Other debtors	171,967		207,658
	184,238		216,377

7. Creditors: amounts falling due within one year

	2022		2021
	£		£
Trade creditors	19,477		28,552
Corporation tax	80,623		79,048
Other taxation and social security	197		1,541
Obligations under finance leases and hire purchase contracts (secured)	17,973		17,973
Other creditors	818,861		821,645
	937,131		948,759

Obligations under finance leases and hire purchase contracts of £17,973 (2021 - £17,973) are secured over the assets to which they relate.

8. Creditors: amounts falling due after more than one year

	2022		2021
	£		£
Obligations under finance leases and hire purchase contracts (secured)	0		17,973

Obligations under finance leases and hire purchase contracts of NIL (2021 - £17,973) are secured over the assets to which they relate.

9. Deferred tax

	2022		2021
	£		£
At the beginning of financial year	( 147,014)		( 154,228)
(Charged)/credited to the Statement of Income and Retained Earnings	( 35,365)		7,214
At the end of financial year	( 182,379)		( 147,014)

10. Called-up share capital

	2022		2021
	£		£
Allotted, called-up and fully-paid
1 Ordinary A share of £ 1.00	1		1
1 Ordinary B share of £ 1.00	1		1
	2		2

11. Related party transactions

Transactions with the entity's directors

	2022		2021
	£		£
Amount due to directors	783,099		795,837