Morrill Investments Limited - Period Ending 2022-03-31

Morrill Investments Limited

Contents

Company Information	1
Balance Sheet	2
Notes to the Unaudited Financial Statements	3 to 11

Morrill Investments Limited

Company Information

Directors

R Guo Y J Chow

Registered office

312 Holderness Road Hull HU9 3DA

Accountants

Hazlewoods LLP Staverton Court Staverton Cheltenham GL51 0UX

Morrill Investments Limited

(Registration number: 06831573)
Balance Sheet as at 31 March 2022

	Note	31 March 2022  £	31 March 2021  £
Fixed assets
Intangible assets	4	186,883	197,031
Tangible assets	5	96,494	102,358
		283,377	299,389
Current assets
Stocks		64,034	53,901
Debtors	6	1,119,283	953,560
Cash at bank and in hand		351,466	223,527
		1,534,783	1,230,988
Creditors: Amounts falling due within one year	7	(496,837)	(534,990)
Net current assets		1,037,946	695,998
Total assets less current liabilities		1,321,323	995,387
Creditors: Amounts falling due after more than one year	8	(163,841)	(212,168)
Deferred tax liabilities		(24,123)	(19,448)
Net assets		1,133,359	763,771
Capital and reserves
Called up share capital	9	1,000	1,000
Profit and loss account		1,132,359	762,771
Total equity		1,133,359	763,771

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 accounts for the year in question in accordance with section 476; and
•	The directors acknowledge their responsibilities for complying with the requirements of the Act with respect to accounting records and the preparation of accounts.

These financial statements have been prepared in accordance with the special provisions relating to companies subject to the small companies regime within Part 15 of the Companies Act 2006.

These financial statements have been delivered in accordance with the provisions applicable to companies subject to the small companies regime and the option not to file the Profit and Loss Account has been taken.

Approved and authorised by the Board on 22 December 2022 and signed on its behalf by:
 

R Guo
Director

Morrill Investments Limited

Notes to the Unaudited Financial Statements for the Year Ended 31 March 2022

1

General information

The company is a private company limited by share capital, incorporated in England and Wales.

The address of its registered office is:
312 Holderness Road
Hull
HU9 3DA

2

Accounting policies

Summary of significant accounting policies and key accounting estimates

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

Statement of compliance

These financial statements have been prepared in accordance with Financial Reporting Standard 102 Section 1A smaller entities - 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland' and the Companies Act 2006 (as applicable to companies subject to the small companies' regime).

Basis of preparation

These financial statements have been prepared using the historical cost convention except for, where disclosed in these accounting policies, certain items that are shown at fair value.

The presentational currency of the financial statements is Pounds Sterling, being the functional currency of the primary economic environment in which the company operates. Monetary amounts in these financial statements are rounded to the nearest Pound.

Going concern

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.

Critical accounting judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amounts 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 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.
 

Judgements

No significant judgements have been made by management in preparing these financial statements.

Key sources of estimation uncertainty

No key sources of estimation uncertainty have been identified by management in preparing these financial statements other than those detailed in these accounting policies.

Revenue recognition

Turnover comprises the fair value of the consideration received or receivable for the sale of goods and provision of services in the ordinary course of the company’s activities. Turnover is shown net of sales/value added tax, returns, rebates and discounts and after eliminating sales within the company.

The company recognises revenue when:
The amount of revenue can be reliably measured;
it is probable that future economic benefits will flow to the entity;
and specific criteria have been met for each of the company's activities.

Morrill Investments Limited

Notes to the Unaudited Financial Statements for the Year Ended 31 March 2022

Tax

The tax expense for the period comprises current and deferred tax. Tax is recognised in the profit and loss account, except that a charge attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.

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 taxable income.

Deferred income tax is recognised on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements and on unused tax losses or tax credits in the company. Deferred income tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.

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 assets

Tangible assets are stated in the statement of balance sheet at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.

The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.

Depreciation

Depreciation is charged so as to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:

Asset class	Depreciation method and rate
Fixtures, fittings and equipment	5 - 25% reducing balance basis
Motor vehicles	25% reducing balance basis
Computer equipment	33.33% straight line

Goodwill

Goodwill is amortised over its useful life, which shall not exceed ten years if a reliable estimate of the useful life cannot be made.

Intangible assets

Goodwill arising on the acquisition of an entity represents the excess of the cost of acquisition over the company’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the entity recognised at the date of acquisition. Goodwill is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is held in the currency of the acquired entity and revalued to the closing rate at each reporting period date.

Negative goodwill arising on an acquisition is recognised on the face of the balance sheet on the acquisition date and subsequently the excess up to the fair value of non-monetary assets acquired is recognised in profit or loss in the periods in which the non-monetary assets are recovered.

Amortisation

Amortisation is provided on intangible assets so as to write off the cost, less any estimated residual value, over their useful life as follows:

Asset class	Amortisation method and rate
Goodwill	Straight line over 20 years

Investments

Investments in equity shares which are publicly traded or where the fair value can be measured reliably are initially measured at fair value, with changes in fair value recognised in profit or loss. Investments in equity shares which are not publicly traded and where fair value cannot be measured reliably are measured at cost less impairment.

Interest income on debt securities, where applicable, is recognised in income using the effective interest method. Dividends on equity securities are recognised in income when receivable.

Morrill Investments Limited

Notes to the Unaudited Financial Statements for the Year Ended 31 March 2022

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.

Trade debtors

Trade debtors are amounts due from customers for goods sold or services performed in the ordinary course of business.

Trade debtors are recognised initially at the transaction price. All trade debtors are repayable within one year and hence are included at the undiscounted cost of cash expected to be received. A provision for the impairment of trade debtors is established when there is objective evidence that the company will not be able to collect all amounts due according to the original terms of the debtors.

Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost is determined using the first-in, first-out (FIFO) method.

The cost of finished goods and work in progress comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the inventories to their present location and condition. At each reporting date, stocks are assessed for impairment. If stocks are 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.

Trade creditors

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the company does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.

Trade creditors are recognised initially at the transaction price and all are repayable within one year and hence are included at the undiscounted amount of cash expected to be paid.

Borrowings

Interest-bearing borrowings are initially recorded at fair value, net of transaction costs. Interest-bearing borrowings are subsequently carried at amortised cost, with the difference between the proceeds, net of transaction costs, and the amount due on redemption being recognised as a charge to the profit and loss account over the period of the relevant borrowing.

Interest expense is recognised on the basis of the effective interest method and is included in interest payable and similar charges.

Borrowings are classified as current liabilities unless the company has an unconditional right to defer settlement of the liability for at least twelve months after the reporting date.

Leases

Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease.

Share capital

Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.

Morrill Investments Limited

Notes to the Unaudited Financial Statements for the Year Ended 31 March 2022

Financial instruments

Classification
Financial instruments are classified and accounted for according to the substance of the contractual arrangement, as financial assets, financial liabilities or equity instruments. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities. Where shares are issued, any component that creates a financial liability of the company is presented as a liability on the balance sheet. The corresponding dividends relating to the liability component are charged as interest expenses in the profit and loss account.

 Recognition and measurement
All financial assets and liabilities are initially measured at transaction price (including transaction costs), except for those financial assets classified as at fair value through profit or loss, which are initially measured at fair value (which is normally the transaction price excluding transaction costs), unless the arrangement constitutes a financing transaction. If an arrangement constitutes a financing transaction, the financial asset or financial liability is measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument.

 Impairment
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 profit or loss as described below.

A non financial asset is impaired where there is objective evidence that, as a result of one or more events that occurred after initial recognition, the estimated recoverable value of the asset has been reduced. The recoverable amount of an asset is the higher of its fair value less costs to sell and its value in use.

3

Staff numbers

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

	Year ended 31 March 2022  No.	18 October 2019 to 31 March 2021  No.
Average number of employees	14	12

4

Intangible assets

	Goodwill  £	Total £
Cost
At 1 April 2021	202,950	202,950
At 31 March 2022	202,950	202,950
Amortisation
At 1 April 2021	5,919	5,919
Amortisation charge	10,148	10,148
At 31 March 2022	16,067	16,067
Carrying amount
At 31 March 2022	186,883	186,883
At 31 March 2021	197,031	197,031

Morrill Investments Limited

Notes to the Unaudited Financial Statements for the Year Ended 31 March 2022

5

Tangible assets

	Furniture, fittings and equipment  £	Motor vehicles  £	Computer equipment  £	Total £
Cost
At 1 April 2021	170,710	13,995	1,897	186,602
Additions	1,480	-	-	1,480
At 31 March 2022	172,190	13,995	1,897	188,082
Depreciation
At 1 April 2021	72,737	11,260	246	84,243
Charge for the period	6,029	684	632	7,345
At 31 March 2022	78,766	11,944	878	91,588
Carrying amount
At 31 March 2022	93,424	2,051	1,019	96,494
At 31 March 2021	97,973	2,735	1,650	102,358

6

Debtors

	Note	31 March 2022  £	31 March 2021  £
Trade debtors		271,489	402,236
Amounts owed by related parties	11	815,712	522,625
Other debtors		26,895	23,512
Prepayments		5,187	5,187
		1,119,283	953,560

Morrill Investments Limited

Notes to the Unaudited Financial Statements for the Year Ended 31 March 2022

7

Creditors

	Note	31 March 2022  £	31 March 2021  £
Due within one year
Loans and borrowings	8	49,947	7,832
Trade creditors		304,817	279,697
Social security and other taxes		7,500	2,805
Outstanding defined contribution pension costs		706	681
Other creditors	11	50,332	145,215
Accrued expenses		3,310	3,000
Corporation tax liability		80,225	95,760
		496,837	534,990

	Note	2022 £	2021 £
Due after one year
Loans and borrowings	8	163,841	212,168

The bank loans and overdraft are secured by way of a fixed and floating charge over the assets of the company.

8

Loans and borrowings

	2022 £	2021 £
Current loans and borrowings
Bank borrowings	49,947	7,832

	2022 £	2021 £
Non-current loans and borrowings
Bank borrowings	163,841	212,168

Included in the loans and borrowings are the following amounts due after more than five years:

	2022 £	2021 £
After more than five years by instalments	-	32,907

	-	-

Morrill Investments Limited

Notes to the Unaudited Financial Statements for the Year Ended 31 March 2022

9

Share capital

Allotted, called up and fully paid shares

	31 March 2022		31 March 2021
	No.	£	No.	£
A Ordinary Shares of £1 each	382	382	382	382
B Ordinary Shares of £1 each	218	218	218	218
C Ordinary Shares of £1 each	200	200	200	200
D Ordinary Shares of £1 each	200	200	200	200
	1,000	1,000	1,000	1,000

The different classes of share referred to above carry separate rights to dividends but, in all other significant respects, rank pari passu.

10

Financial commitments

Operating leases

The total of future minimum lease payments is as follows:

	2022  £	2021  £
Not later than one year	43,270	29,790
Later than one year and not later than five years	142,478	113,327
Later than five years	207,500	228,250
	393,248	371,367

The amount of non-cancellable operating lease payments recognised as an expense during the year was £41,176 (2021 - £34,746).

Morrill Investments Limited

Notes to the Unaudited Financial Statements for the Year Ended 31 March 2022

11

Related party transactions

Key management personnel

Key management personnel are considered to be the directors of the company.

At the balance sheet date, the directors owed the company £147,829 (2021 - £64,239). There are no fixed repayment terms and no interest is charged on the outstanding amount.

2022	At 1 April 2021 £	Advances to director £	Repayments by director £	At 31 March 2022 £
Y J Chow
	(48,551)	(55,208)	12,616	(91,143)
	(48,551)	(55,208)	12,616	(91,143)
R Guo
	(15,688)	(51,815)	15,770	(51,733)
	(15,688)	(51,815)	15,770	(51,733)

2021	At 18 October 2019 £	Advances to director £	Repayments by director £	At 31 March 2021 £
Y J Chow
	-	(86,170)	37,619	(48,551)
	-	(86,170)	37,619	(48,551)
R Guo
	-	(72,746)	57,058	(15,688)
	-	(72,746)	57,058	(15,688)

Summary of transactions with parent

Morrill Healthcare Limited
(Parent company)
At the balance sheet date, the company was owed £603,822 by Morrill Healthcare Limited (2021 - £434,786). There are no fixed repayment terms and the loan is interest free. This amount is included within amounts owed from related parties.
 

Morrill Investments Limited

Notes to the Unaudited Financial Statements for the Year Ended 31 March 2022

Summary of transactions with other related parties

D J Mitchell Limited
 (A company which has a common director with Morrill Investments Limited).
 As at the balance sheet date, the company owed £2,000 to D J Mitchell Limited (2021 - £2,000). There are no fixed repayment terms and the loan is interest free. This amount is included within other creditors.

RMBX Limited
(A company which has a common director with Morrill Investments Limited).
As at the balance sheet date, the company owed £41,000 to RMBX Limited (2021 - £50,000). There are no fixed repayment terms and the loan is interest free. This amount is included within other creditors.

Trafalgar Pharma Ltd
(A company which has a common director with Morrill Investments Limited).
As at the balance sheet date, the company was owed £3,600 from Trafalgar Pharma Ltd (2021 - £3,600). There are no fixed repayment terms and the loan is interest free. This amount is included within other debtors.

Burley Louth Limited
(A company which has a common director with Morrill Investments Limited).
As at the balance sheet date, the company was owed £65,414 from Burley Louth Limited (2021 - £20,000). There are no fixed repayment terms and the loan is interest free. This amount is included within other debtors.

T.A .Burley Limited
(A director owns shares in T.A. Burley Limited)
As at the balance sheet date the company owed £7,332 (2021 - £nil) to T.A. Burley Limited. There are no fixed repayment terms and the loan is interest free. This amount is included within other creditors.