Fonacab (Belfast) Limited 31/12/2020 iXBRL

Fonacab (Belfast) Limited 31/12/2020 iXBRL

FONACAB (BELFAST) LIMITED - Company Information

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Company registration number: NI005417
Fonacab (Belfast) Limited
Financial statements
31 December 2020
Fonacab (Belfast) Limited
Contents
Directors and other information
Strategic report
Director's report
Independent auditor's report to the member
Statement of income and retained earnings
Statement of financial position
Statement of cash flows
Notes to the financial statements
Fonacab (Belfast) Limited
Directors and other information
Director Mr William J McCausland
Secretary Simon Sims
Company number NI005417
Registered office 209 Knock Road
Belfast
BT5 6QE
Business address 209 Knock Road
Belfast
BT5 6QE
Auditor Potter Finnegan Limited
Unit 25 The Courtyard Business Park
190 Galgorm Road
Ballymena
Co Antrim
BT42 1HL
Bankers Danske Bank
PO Box 183
Donegall Square West
Belfast
BT1 6JS
Fonacab (Belfast) Limited
Strategic report
Year ended 31 December 2020
Principal activities of the business
The company is primarily a taxi business serving the greater Belfat area and includes car sales and servicing division under the brand name Crawford Clarke Cars. The company has over fifty years of industry experience and operates the largest fleet of cars in Northern Ireland. Conscious of the need to raise the standards, the company has led the way in Northern Ireland for many years, being the first to introduce computerised dispatch, in-car meters, roof signs, and uniformed drivers. With continuing significant capital investment, the company has installed state of the art GPS-based dispatch system, ensuring ultimate efficiency in operation, now including the introduction of App bookings and other types of automated booking systems.
Review of Business Performance
The company operates in a competitive market and continually strives to introduce new and improved services to meet the growing needs and demands of its customers. These services include the largest fleet of vehicles in Northern Ireland, preferential and priority services for account holders, uniformed and fully trained drivers, instant response courier service, computerised dispatch system, automated booking system, wheelchair accessible vehicles, executive cars and taxi tours. This financial year has been badly affected by the Coronavirus pandemic and the Northern Ireland taxi industry faces many challenges going forward. However, the company will continue to adapt and evolve to meet these challenges. The company has always aimed to stay at the leading edge of the Northern Ireland taxi industry and it intends to consolidation this position in a post pandemic economic environment.
Key Performance Indicators
This year was an exceptional difficult year because of the coronavirus pandemic. However, the company adapted to the extreme conditions it faced by using the Coronavirus job retention scheme and accessing finance through Coronavirus business interuption loan scheme. The company should return to profit in the year ended 31 December 2021 and the director is confident that trading in the longer term will return to pre pandemic levels.
Principal Risks and Uncertainties
The principal risk and uncertainties facing the company is now the long term effects of the coronavirus pandemic. The company has taken steps to minimise where possible the effects of the pandemic. The short term plans for further growth and acquisitions will be delayed until there is a return to a more stable trading environment.
Strategic Management
The company's strategic objectives are to continually strive to introduce new and improved services to meet the growing needs and demands of its customers, to continue to maximise company operating efficiencies and continued investment in advances in technology.
Future Developments
The director feels that the company is in a strong financial position despite the current economic environment. The company remains well positioned to recover and grow and, as such, will focus on ensuring strategic objectives are realised when the general economy returns to more normal conditions.
This report was approved by the board of directors on 28 September 2021 and signed on behalf of the board by:
Mr William J McCausland
Director
Fonacab (Belfast) Limited
Director's report
Year ended 31 December 2020
The director presents his report and the financial statements of the company for the year ended 31 December 2020.
Director
The director who served the company during the year was as follows:
Mr William J McCausland
Dividends
Particulars of recommended dividends are detailed in note 12 to the financial statements.
Director's responsibilities statement
The director is responsible for preparing the strategic report, director's report and the financial statements in accordance with applicable law and regulations.
Company law requires the director to prepare financial statements for each financial year. Under that law the director has elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the director must not approve the financial statements unless he is satisfied that they give a true and fair view of the state of affairs of the company and the profit or loss of the company for that period.
In preparing these financial statements, the director is required to:
- select suitable accounting policies and then apply them consistently;
- make judgments and accounting estimates that are reasonable and prudent; and
- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The director is responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable him to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Auditor
Each of the persons who is a director at the date of approval of this report confirms that:
- so far as they are aware, there is no relevant audit information of which the company's auditor is unaware; and - they have taken all steps that they ought to have taken as a director to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information.
The auditor is deemed to have been re-appointed in accordance with section 487 of the Companies Act 2006.
This report was approved by the board of directors on 28 September 2021 and signed on behalf of the board by:
Mr William J McCausland
Director
Fonacab (Belfast) Limited
Independent auditor's report to the member of
Fonacab (Belfast) Limited
Year ended 31 December 2020
Opinion
We have audited the financial statements of Fonacab (Belfast) Limited (the 'company') for the year ended 31 December 2020 which comprise the statement of income and retained earnings, statement of financial position, statement of cash flows and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice). In our opinion, the financial statements: - give a true and fair view of the state of the company's affairs as at 31 December 2020 and of its loss for the year then ended; - have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and - have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the director's use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the director with respect to going concern are described in the relevant sections of this report.
Other Information
The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. The director is responsible for the other information. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
- the information given in the strategic report and the director's report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
- the strategic report and the director's report has been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the director's report. We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion: - adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or - the financial statements are not in agreement with the accounting records and the returns; or - certain disclosures of director's remuneration specified by law are not made; or - we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the director's responsibilities statement, the director is responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the director determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the director is responsible for assessing the company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the director either intends to liquidate the company or to cease operations, or has no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: - We made enquiries of management and those charged with governance regarding their records of any instances of non-compliance with laws and regulations applicable to the company which could have a material impact on the financial statements. - We reviewed professional costs to identify potential advice being taken in relation to non-compliance issues. - We held discussions with management to determine if there had been any suspected or actual instances of fraud and concluded that there had been none. As part of our fraud assessment, we also considered the risk of management over-ride of internal control systems. - We considered that the principal audit risks would arise from the overstatement of income or assets and the understatement of costs or liabilities. We also reviewed any estimates used by management for reliability. As a result of the above assessment, we designed procedures to test a sample of entries made in the company's accounting records. We also reviewed any estimates used or areas of judgement and critically assessed the priniplces on which they has been established. Due to the nature of how an audit is performed, there is an inherent risk that we may not detect all irregularities contained in the financial statements. The risk of a material mistatement is higher due to an instance of deliberate misrepresentation or collusion, and an audit is unlikely to highlight or uncover such actions. A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
Use of our report
This report is made solely to the company's member, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's member those matters we are required to state to him in an auditors report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's member as a body, for our audit work, for this report, or for the opinions we have formed.
John Finnegan (Senior Statutory Auditor)
For and on behalf of
Potter Finnegan Limited
Chartered Accountants and Registered Auditors
Unit 25 The Courtyard Business Park
190 Galgorm Road
Ballymena
Co Antrim
BT42 1HL
28 September 2021
Fonacab (Belfast) Limited
Statement of income and retained earnings
Year ended 31 December 2020
2020 2019
Note £ £
Turnover 4 9,872,166 19,425,508
Cost of sales ( 5,871,070) ( 11,895,404)
_______ _______
Gross profit 4,001,096 7,530,104
Administrative expenses ( 5,002,107) ( 5,349,623)
Other operating income 5 693,165 40,927
_______ _______
Operating (loss)/profit 6 ( 307,846) 2,221,408
Other interest receivable and similar income 9 328,211 394,945
Interest payable and similar expenses 10 ( 165,349) ( 198,418)
_______ _______
(Loss)/profit before taxation ( 144,984) 2,417,935
Tax on (loss)/profit 11 ( 14,121) ( 499,879)
_______ _______
(Loss)/profit for the financial year and total comprehensive income ( 159,105) 1,918,056
_______ _______
Dividends declared and paid or payable during the year 12 ( 168,000) ( 811,953)
Retained earnings at the start of the year 7,525,677 6,419,574
_______ _______
Retained earnings at the end of the year 7,198,572 7,525,677
_______ _______
All the activities of the company are from continuing operations.
Fonacab (Belfast) Limited
Statement of financial position
31 December 2020
2020 2019
Note £ £ £ £
Fixed assets
Intangible assets 13 1,537,183 1,746,311
Tangible assets 14 2,382,388 2,806,174
Investments 15 101,180 101,180
_______ _______
4,020,751 4,653,665
Current assets
Stocks 16 2,071,667 1,714,359
Debtors 17 3,818,755 6,656,032
Cash at bank and in hand 1,669,336 905,447
_______ _______
7,559,758 9,275,838
Creditors: amounts falling due
within one year 18 ( 2,771,641) ( 4,001,151)
_______ _______
Net current assets 4,788,117 5,274,687
_______ _______
Total assets less current liabilities 8,808,868 9,928,352
Creditors: amounts falling due
after more than one year 19 ( 1,518,734) ( 2,261,157)
Provisions for liabilities 21 ( 90,562) ( 140,518)
_______ _______
Net assets 7,199,572 7,526,677
_______ _______
Capital and reserves
Called up share capital 25 1,000 1,000
Profit and loss account 26 7,198,572 7,525,677
_______ _______
Shareholder funds 7,199,572 7,526,677
_______ _______
These financial statements were approved by the board of directors and authorised for issue on 28 September 2021 , and are signed on behalf of the board by:
Mr William J McCausland
Director
Company registration number: NI005417
Fonacab (Belfast) Limited
Statement of cash flows
Year ended 31 December 2020
2020 2019
£ £
Cash flows from operating activities
(Loss)/profit for the financial year ( 159,105) 1,918,056
Adjustments for:
Depreciation of tangible assets 423,999 394,279
Amortisation of intangible assets 219,129 183,116
Government grant income ( 665,763) -
Other interest receivable and similar income ( 328,211) ( 394,945)
Interest payable and similar expenses 165,349 198,418
Gain/(loss) on disposal of tangible assets 1,921 ( 11,221)
Tax on loss/profit 14,121 499,879
Accrued expenses/(income) ( 1,692) ( 82,690)
Changes in:
Stocks ( 357,308) 512,945
Trade and other debtors 2,837,277 83,641
Trade and other creditors ( 113,484) 162,551
Stock transferred to fixed assets - ( 271,309)
_______ _______
Cash generated from operations 2,036,233 3,192,720
Interest paid ( 165,349) ( 198,418)
Interest received 328,211 394,945
Tax paid ( 345,485) ( 428,742)
_______ _______
Net cash from operating activities 1,853,610 2,960,505
_______ _______
Cash flows from investing activities
Purchase of tangible assets ( 61,708) ( 608,714)
Proceeds from sale of tangible assets 59,574 124,123
Purchase of intangible assets ( 10,000) ( 731,500)
_______ _______
Net cash used in investing activities ( 12,134) ( 1,216,091)
_______ _______
Cash flows from financing activities
Proceeds from borrowings ( 14,564) 83,310
Government grant income 665,763 -
Payment of finance lease liabilities ( 1,560,785) ( 407,999)
Equity dividends paid ( 168,000) ( 811,953)
_______ _______
Net cash used in financing activities ( 1,077,586) ( 1,136,642)
_______ _______
Net increase/(decrease) in cash and cash equivalents 763,890 607,772
Cash and cash equivalents at beginning of year 905,447 297,675
_______ _______
Cash and cash equivalents at end of year 1,669,337 905,447
_______ _______
Fonacab (Belfast) Limited
Notes to the financial statements
Year ended 31 December 2020
1. General information
The company is a private company limited by shares, registered in Northern Ireland. The address of the registered office is Fonacab (Belfast) Limited, 209 Knock Road, Belfast, BT5 6QE.
2. Statement of compliance
These financial statements have been prepared in compliance with FRS 102, 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'
3. Accounting policies
Basis of preparation
The financial statements have been prepared on the historical cost basis, as modified by the revaluation of certain financial assets and liabilities and investment properties measured at fair value through profit or loss.
The financial statements are prepared in sterling, which is the functional currency of the entity.
Judgements and key sources of estimation uncertainty
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported. These estimates and judgements are continually reviewed and are based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
Turnover
Turnover is measured at the fair value of the consideration received or receivable for goods supplied and services rendered, net of discounts and Value Added Tax.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership have transferred to the buyer (usually on despatch of the goods); the amount of revenue can be measured reliably; it is probable that the associated economic benefits will flow to the entity; and the costs incurred or to be incurred in respect of the transactions can be measured reliably.
Taxation
The taxation expense represents the aggregate amount of current and deferred tax recognised in the reporting period. Tax is recognised in the statement of comprehensive income, except to the extent that it relates to items recognised in other comprehensive income or directly in capital and reserves. In this case, tax is recognised in other comprehensive income or directly in capital and reserves, respectively. Current tax is recognised on taxable profit for the current and past periods. Current tax is measured at the amounts of tax expected to pay or recover using the tax rates and laws that have been enacted or substantively enacted at the reporting date.
Deferred tax is recognised in respect of all timing differences at the reporting date. Unrelieved tax losses and other deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date that are expected to apply to the reversal of the timing difference.
Goodwill
Goodwill arises on business acquisitions and represents the excess of the cost of the acquisition over the company's interest in the net amount of the identifiable assets, liabilities and contingent liabilities of the acquired business. Goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. It is amortised on a straight line basis over its useful life. Where a reliable estimate of the useful life of goodwill or intangible assets cannot be made, the life is presumed not to exceed ten years.
Amortisation
Amortisation is calculated so as to write off the cost of an asset, less its estimated residual value, over the useful life of that asset as follows:
Goodwill - 10 % straight line
If there is an indication that there has been a significant change in amortisation rate, useful life or residual value of an intangible asset, the amortisation is revised prospectively to reflect the new estimates.
Tangible assets
tangible assets are initially recorded at cost, and are subsequently stated at cost less any accumulated depreciation and impairment losses. Any tangible assets carried at revalued amounts are recorded at the fair value at the date of revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses. An increase in the carrying amount of an asset as a result of a revaluation, is recognised in other comprehensive income and accumulated in capital and reserves, except to the extent it reverses a revaluation decrease of the same asset previously recognised in profit or loss. A decrease in the carrying amount of an asset as a result of revaluation is recognised in other comprehensive income to the extent of any previously recognised revaluation increase accumulated in capital and reserves in respect of that asset. Where a revaluation decrease exceeds the accumulated revaluation gains accumulated in capital and reserves in respect of that asset, the excess shall be recognised in profit or loss.
Depreciation
Depreciation is calculated so as to write off the cost or valuation of an asset, less its residual value, over the useful economic life of that asset as follows:
Plant and Machinery - Radio Equipment - 25 % reducing balance
Plant and Machinery - Garage Equipment - 20% reducing balance
Fittings fixtures and equipment - 20 % reducing balance
Motor vehicles - 25 % reducing balance
If there is an indication that there has been a significant change in depreciation rate, useful life or residual value of tangible assets, the depreciation is revised prospectively to reflect the new estimates.
Fixed asset investments
Fixed asset investments are initially recorded at cost, and subsequently stated at cost less any accumulated impairment losses. Listed investments are measured at fair value with changes in fair value being recognised in profit or loss.
Impairment
A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date. When it is not possible to estimate the recoverable amount of an individual asset, an estimate is made of the recoverable amount of the cash-generating unit to which the asset belongs. The cash-generating unit is the smallest identifiable group of assets that includes the asset and generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets. For impairment testing of goodwill, the goodwill acquired in a business combination is, from the acquisition date, allocated to each of the cash-generating units that are expected to benefit from the synergies of the combination, irrespective of whether other assets or liabilities of the company are assigned to those units.
Stocks
Stocks are measured at the lower of cost and estimated selling price less costs to complete and sell. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing the stocks to their present location and condition.
Hire purchase and finance leases
Assets held under finance leases are recognised in the statement of financial position as assets and liabilities at the lower of the fair value of the assets and the present value of the minimum lease payments, which is determined at the inception of the lease term. Any initial direct costs of the lease are added to the amount recognised as an asset. Lease payments are apportioned between the finance charges and reduction of the outstanding lease liability using the effective interest method. Finance charges are allocated to each period so as to produce a constant rate of interest on the remaining balance of the liability.
Government grants
Government grants are recognised at the fair value of the asset received or receivable. Grants are not recognised until there is reasonable assurance that the company will comply with the conditions attaching to them and the grants will be received. Government grants are recognised using the accrual model and the performance model. Under the accrual model, government grants relating to revenue are recognised on a systematic basis over the periods in which the company recognises the related costs for which the grant is intended to compensate. Grants that are receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the entity with no future related costs are recognised in income in the period in which it becomes receivable. Grants relating to assets are recognised in income on a systematic basis 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 and not deducted from the carrying amount of the asset. Under the performance model, where the grant does not impose specified future performance-related conditions on the recipient, it is recognised in income when the grant proceeds are received or receivable. Where the grant does impose specified future performance-related conditions on the recipient, it is recognised in income only when the performance-related conditions have been met. Where grants received are prior to satisfying the revenue recognition criteria, they are recognised as a liability.
Provisions
Provisions are recognised when the entity has an obligation at the reporting date as a result of a past event; it is probable that the entity will be required to transfer economic benefits in settlement and the amount of the obligation can be estimated reliably. Provisions are recognised as a liability in the statement of financial position and the amount of the provision as an expense. Provisions are initially measured at the best estimate of the amount required to settle the obligation at the reporting date and subsequently reviewed at each reporting date and adjusted to reflect the current best estimate of the amount that would be required to settle the obligation. Any adjustments to the amounts previously recognised are recognised in profit or loss unless the provision was originally recognised as part of the cost of an asset. When a provision is measured at the present value of the amount expected to be required to settle the obligation, the unwinding of the discount is recognised in finance costs in profit or loss in the period it arises.
Financial instruments
A financial asset or a financial liability is recognised only when the company becomes a party to the contractual provisions of the instrument. Basic financial instruments are initially recognised at the transaction price, unless the arrangement constitutes a financing transaction, where it is recognised at the present value of the future payments discounted at a market rate of interest for a similar debt instrument. Debt instruments are subsequently measured at amortised cost. Where investments in non-convertible preference shares and non-puttable ordinary shares or preference shares are publicly traded or their fair value can otherwise be measured reliably, the investment is subsequently measured at fair value with changes in fair value recognised in profit or loss. All other such investments are subsequently measured at cost less impairment. Other financial instruments, including derivatives, are initially recognised at fair value, unless payment for an asset is deferred beyond normal business terms or financed at a rate of interest that is not a market rate, in which case the asset is measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument. Other financial instruments are subsequently measured at fair value, with any changes recognised in profit or loss, with the exception of hedging instruments in a designated hedging relationship.
Financial assets that are measured at cost or amortised cost are reviewed for objective evidence of impairment at the end of each reporting date. If there is objective evidence of impairment, an impairment loss is recognised in profit or loss immediately. For all equity instruments regardless of significance, and other financial assets that are individually significant, these are assessed individually for impairment. Other financial assets or either assessed individually or grouped on the basis of similar credit risk characteristics. Any reversals of impairment are recognised in profit or loss immediately, to the extent that the reversal does not result in a carrying amount of the financial asset that exceeds what the carrying amount would have been had the impairment not previously been recognised.
Defined contribution plans
Contributions to defined contribution plans are recognised as an expense in the period in which the related service is provided. Prepaid contributions are recognised as an asset to the extent that the prepayment will lead to a reduction in future payments or a cash refund. When contributions are not expected to be settled wholly within 12 months of the end of the reporting date in which the employees render the related service, the liability is measured on a discounted present value basis. The unwinding of the discount is recognised in finance costs in profit or loss in the period in which it arises.
4. Turnover
Turnover arises from:
2020 2019
£ £
Sale of goods & services 9,883,332 19,425,508
_______ _______
The whole of the turnover is attributable to the principal activity of the company wholly undertaken in the United Kingdom.
5. Other operating income
2020 2019
£ £
Rental income 27,402 40,927
Government grant income 665,763 -
_______ _______
693,165 40,927
_______ _______
6. Operating loss/profit
Operating loss/profit is stated after charging/(crediting):
2020 2019
£ £
Amortisation of intangible assets 219,129 183,116
Depreciation of tangible assets 423,999 394,279
(Gain)/loss on disposal of tangible assets 1,921 ( 11,221)
Impairment of trade debtors 10,986 18,070
Fees payable for the audit of the financial statements 6,000 6,000
_______ _______
7. Staff costs
The average number of persons employed by the company during the year, including the director, amounted to:
2020 2019
Production and administration staff 129 97
_______ _______
The aggregate payroll costs incurred during the year were:
2020 2019
£ £
Wages and salaries 2,281,396 2,372,065
Social security costs 179,520 204,797
Other pension costs 39,806 45,787
_______ _______
2,500,722 2,622,649
_______ _______
8. Directors remuneration
The director's aggregate remuneration in respect of qualifying services was:
2020 2019
£ £
Remuneration 15,900 15,600
Company contributions to pension schemes in respect of qualifying services 146 10,000
_______ _______
16,046 25,600
_______ _______
9. Other interest receivable and similar income
2020 2019
£ £
Loans and receivables 328,211 394,945
_______ _______
10. Interest payable and similar expenses
2020 2019
£ £
Other loans made to the company:
Finance leases and hire purchase contracts 92,817 111,565
Other interest payable and similar expenses 72,532 86,853
_______ _______
165,349 198,418
_______ _______
11. Tax on loss/profit
Major components of tax expense
2020 2019
£ £
Current tax:
UK current tax expense 64,893 461,656
Adjustments in respect of previous periods ( 816) -
_______ _______
Total UK current tax 64,077 461,656
Deferred tax:
Origination and reversal of timing differences ( 49,956) 38,223
_______ _______
Tax on loss/profit 14,121 499,879
_______ _______
Reconciliation of tax expense
The tax assessed on the loss/profit for the year is higher than (2019: higher than) the standard rate of corporation tax in the UK of 19.00 % (2019: 19.00%).
2020 2019
£ £
(Loss)/profit before taxation ( 144,984) 2,417,935
_______ _______
(Loss)/profit multiplied by rate of tax ( 27,547) 459,408
Adjustments in respect of prior periods ( 816) -
Effect of expenses not deductible for tax purposes 42,484 36,953
Effect of capital allowances and depreciation 49,956 ( 34,705)
_______ _______
Tax on loss/profit 64,077 461,656
_______ _______
12. Dividends
Equity dividends
2020 2019
£ £
Dividends paid during the year (excluding those for which a liability existed at the end of the prior year) 168,000 811,953
_______ _______
13. Intangible assets
Goodwill Total
£ £
Cost
At 1 January 2020 2,763,682 2,763,682
Additions 10,000 10,000
_______ _______
At 31 December 2020 2,773,682 2,773,682
_______ _______
Amortisation
At 1 January 2020 1,017,370 1,017,370
Charge for the year 219,129 219,129
_______ _______
At 31 December 2020 1,236,499 1,236,499
_______ _______
Carrying amount
At 31 December 2020 1,537,183 1,537,183
_______ _______
At 31 December 2019 1,746,312 1,746,312
_______ _______
14. Tangible assets
Freehold property Plant and machinery Fixtures, fittings and equipment Motor vehicles Total
£ £ £ £ £
Cost
At 1 January 2020 1,369,576 2,942,178 860,109 459,216 5,631,079
Additions - 30,846 3,531 27,331 61,708
Disposals - - - ( 103,135) ( 103,135)
_______ _______ _______ _______ _______
At 31 December 2020 1,369,576 2,973,024 863,640 383,412 5,589,652
_______ _______ _______ _______ _______
Depreciation
At 1 January 2020 69,458 2,072,860 544,174 138,413 2,824,905
Charge for the year - 289,082 64,659 70,258 423,999
Disposals - - - ( 41,640) ( 41,640)
_______ _______ _______ _______ _______
At 31 December 2020 69,458 2,361,942 608,833 167,031 3,207,264
_______ _______ _______ _______ _______
Carrying amount
At 31 December 2020 1,300,118 611,082 254,807 216,381 2,382,388
_______ _______ _______ _______ _______
At 31 December 2019 1,300,118 869,318 315,935 320,803 2,806,174
_______ _______ _______ _______ _______
15. Investments
Other loans Total
£ £
Cost
At 1 January 2020 and 31 December 2020 101,180 101,180
_______ _______
Impairment
At 1 January 2020 and 31 December 2020 - -
_______ _______
Carrying amount
At 31 December 2020 101,180 101,180
_______ _______
At 31 December 2019 101,180 101,180
_______ _______
16. Stocks
2020 2019
£ £
Finished goods and goods for resale 2,071,667 1,714,359
_______ _______
17. Debtors
2020 2019
£ £
Trade debtors 397,990 813,045
Prepayments and accrued income 164,686 305,146
Other debtors 3,256,079 5,537,841
_______ _______
3,818,755 6,656,032
_______ _______
18. Creditors: amounts falling due within one year
2020 2019
£ £
Bank loans and overdrafts 949,576 1,053,977
Trade creditors 515,157 590,079
Accruals and deferred income 71,683 73,375
Corporation tax 64,893 346,301
Social security and other taxes 418,630 441,256
Obligations under finance leases 726,020 1,453,691
Director loan accounts 832 1,686
Other creditors 24,850 40,786
_______ _______
2,771,641 4,001,151
_______ _______
19. Creditors: amounts falling due after more than one year
2020 2019
£ £
Bank loans and overdrafts 1,316,416 1,225,725
Obligations under finance leases 202,318 1,035,432
_______ _______
1,518,734 2,261,157
_______ _______
20. Obligations under finance leases
Company lessee
The total future minimum lease payments under finance lease agreements are as follows:
2020 2019
£ £
Not later than 1 year 726,020 1,453,691
Later than 1 year and not later than 5 years 202,318 1,035,432
_______ _______
928,338 2,489,123
_______ _______
Present value of minimum lease payments 928,338 2,489,123
_______ _______
21. Provisions
Deferred tax (note 22) Total
£ £
At 1 January 2020 140,518 140,518
Additions ( 49,956) ( 49,956)
_______ _______
At 31 December 2020 90,562 90,562
_______ _______
22. Deferred tax
The deferred tax included in the statement of financial position is as follows:
2020 2019
£ £
Included in provisions (note 21) 90,562 140,518
_______ _______
The deferred tax account consists of the tax effect of timing differences in respect of:
2020 2019
£ £
Accelerated capital allowances 90,562 140,518
_______ _______
23. Employee benefits
The amount recognised in profit or loss in relation to defined contribution plans was £ 39,806 (2019: £ 45,787 ).
24. Government grants
The amounts recognised in the financial statements for government grants are as follows:
2020 2019
£ £
Recognised in other operating income:
Government grants recognised directly in income 665,763 -
_______ _______
25. Called up share capital
Authorised share capital
2020 2019
No £ No £
Ordinary shares of £ 1.00 each 1,000 1,000 1,000 1,000
_______ _______ _______ _______
26. Reserves
Profit and loss account - This reserve records retained earnings and accumulated losses.
27. Directors advances, credits and guarantees
There have been no directors advances, credits or guarantees during the year.
28. Controlling party
The company is controlled by WIlliam McCausland.