Aykroyd & Sons Limited - Limited company accounts 20.1

REGISTERED NUMBER: 00263547 (England and Wales)

Strategic Report, Report of the Directors and

Financial Statements

for the Year Ended 31 March 2021

for

Aykroyd & Sons Limited

Page

Company Information

1

Strategic Report

2

Report of the Directors

3

Report of the Independent Auditors

5

Income Statement

9

Other Comprehensive Income

10

Balance Sheet

11

Statement of Changes in Equity

12

Notes to the Financial Statements

13

DIRECTORS:

Mr D B Aykroyd

Mr N J Aykroyd

Ms F E Aykroyd-Davies

Ms D L Aykroyd-Duckett

Ms S H Galdo

Mr S S Aykroyd

Mr A Robson

Mr R Broadhurst

SECRETARY:

Mr A C Gilbody

REGISTERED OFFICE:

Unit 17

Bala Enterprise Park

Bala

Gwynedd

LL23 7NJ

REGISTERED NUMBER:

00263547 (England and Wales)

SENIOR STATUTORY AUDITOR:

Ian Sluckis BA FCA

AUDITORS:

Freedman Frankl & Taylor

Statutory Auditors

Chartered Accountants

Reedham House

31 King Street West

Manchester

M3 2PJ

The directors present their strategic report for the year ended 31 March 2021.

The principal activities of the company continue to be that of distributors of pyjamas, dressing gowns and leisurewear.

The results for the year and financial position of the company are as shown in the annexed financial statements.

2020/2021 was certainly a year none of us will ever forget! It ended up however with another record turnover for Aykroyd and Sons Limited, which was amazing considering we were nearly 30% down for the first quarter due to Covid.

Improved margins together with some savings in overheads have helped to improve the net profit for the year.

The company regard the KPIs as turnover and profitability both of which are stated in the financial statements.

The principal risks and uncertainties affecting the business are the impact of Covid-19 on trading conditions, foreign currency exchange, and raw material availability and prices. All the above factors are closely monitored by the directors.

There are some serious concerns for 2021/2022, due to the worldwide shipping crisis that raised its head towards the end of this financial year.

ON BEHALF OF THE BOARD:

Mr D B Aykroyd - Director

10 December 2021

The directors present their report with the financial statements of the company for the year ended 31 March 2021.

DIVIDENDS

The total distribution of dividends for the year ended 31 March 2021 will be £ 1,197,700 .

DIRECTORS

The directors shown below have held office during the whole of the period from 1 April 2020 to the date of this report.

Mr D B Aykroyd

Mr N J Aykroyd

Ms F E Aykroyd-Davies

Ms D L Aykroyd-Duckett

Ms S H Galdo

Mr S S Aykroyd

Mr A Robson

Other changes in directors holding office are as follows:

Mr R Broadhurst was appointed as a director after 31 March 2021 but prior to the date of this report.

Mr A Cornforth ceased to be a director after 31 March 2021 but prior to the date of this report.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Strategic Report, the Report of the Directors and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have 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 directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

-	select suitable accounting policies and then apply them consistently;

-	make judgements and accounting estimates that are reasonable and prudent;

-	state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements;

-	prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are 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 them 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.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

ON BEHALF OF THE BOARD:

Mr D B Aykroyd - Director

10 December 2021

Opinion

We have audited the financial statements of Aykroyd & Sons Limited (the 'company') for the year ended 31 March 2021 which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity 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 Financial Reporting Standard 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 March 2021 and of its profit 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 Auditors' 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 directors' 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 directors with respect to going concern are described in the relevant sections of this report.

Other information

The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

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 this gives rise to a material misstatement in the financial statements themselves. 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 Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Strategic Report and the Report of the Directors have 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 Report of the Directors.

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 returns; or

-	certain disclosures of directors' 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 Statement of Directors' Responsibilities set out on page three, the directors are 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 directors determine 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 directors are 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 directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditors' 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 a Report of the Auditors 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 identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and then design and perform audit procedures responsive to those risks, including obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion.

Identifying and assessing potential risks to irregularities

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, we considered the following:

Audit response to risks identified

-

the nature of the industry and sector, control environment and business performance;

-

results of enquiries of management about their own identification and assessment of the risks of irregularities;

-

any matters we identified having obtained and reviewed the Company's documentation of their policies and procedures relating to:

-

identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of noncompliance;

-

detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud;

-

the internal controls established to mitigate risks of fraud or non-compliance with laws and regulations;

-

the matters discussed among the audit engagement team including significant component audit teams and involving other internal specialists including tax regarding how and where fraud might occur in the financial statements and any potential indicators of fraud.

As a result of these procedures, we considered the opportunities and incentives that may exist within the organisation for fraud. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risks of management override.

We also obtained an understanding of the legal and regulatory frameworks that the Company operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included the UK Companies Act and local tax legislation.

Audit response to risks identified

As a result of performing the above, we did not identify any key audit matters related to the potential risk of fraud.

Our procedures to respond to risks identified included the following:

-

reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements;

-

enquiring of management concerning actual and potential litigation and claims;

-

performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;

-

obtained an understanding of provisions and held discussions with management to understand the basis of recognition or non-recognition of tax provisions; and

-

in addressing the risks of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments; assessing whether the judgements made in making accounting estimates are indicative of potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.

We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members and significant component audit teams, and remained alert to any indications of fraud or noncompliance with laws and regulations throughout the audit.

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 Report of the Auditors.

Use of our report

This report is made solely to the company's members, 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 members those matters we are required to state to them in a Report of the Auditors 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 members as a body, for our audit work, for this report, or for the opinions we have formed.

Ian Sluckis BA FCA (Senior Statutory Auditor)

for and on behalf of Freedman Frankl & Taylor

Statutory Auditors

Chartered Accountants

Reedham House

31 King Street West

Manchester

M3 2PJ

16 December 2021

TURNOVER

3

57,137,694

55,392,259

Cost of sales

52,980,559

52,160,555

GROSS PROFIT

4,157,135

3,231,704

Distribution costs

586,171

887,449

Administrative expenses

1,619,226

2,297,393

2,205,397

3,184,842

1,951,738

46,862

Other operating income

572,893

26,248

OPERATING PROFIT

5

2,524,631

73,110

Interest receivable and similar income

10,790

10,260

2,535,421

83,370

Amounts written off investments

6

229,246

-

2,306,175

83,370

Interest payable and similar expenses

7

507

7,304

PROFIT BEFORE TAXATION

2,305,668

76,066

Tax on profit

8

514,713

41,176

PROFIT FOR THE FINANCIAL YEAR

1,790,955

34,890

PROFIT FOR THE YEAR

1,790,955

34,890

OTHER COMPREHENSIVE INCOME

Movement on hedging reserve

(298,873

)

131,499

Income tax relating to other comprehensive income

20,669

(24,530

)

OTHER COMPREHENSIVE INCOME FOR THE YEAR, NET OF INCOME TAX

(278,204

)

106,969

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

1,512,751

141,859

FIXED ASSETS

Tangible assets

10

2,425,386

2,598,866

Investments

11

23,050

252,296

Investment property

12

539,233

539,233

2,987,669

3,390,395

CURRENT ASSETS

Stocks

13

3,796,009

3,870,696

Debtors

14

9,794,269

8,388,703

Investments

15

7,900

7,900

Cash at bank and in hand

1,266,446

734,735

14,864,624

13,002,034

CREDITORS

Amounts falling due within one year

16

3,810,849

2,636,871

NET CURRENT ASSETS

11,053,775

10,365,163

TOTAL ASSETS LESS CURRENT LIABILITIES

14,041,444

13,755,558

CREDITORS

Amounts falling due after more than one year

17

(416,301

)

(424,797

)

PROVISIONS FOR LIABILITIES

20

-

(20,669

)

NET ASSETS

13,625,143

13,310,092

CAPITAL AND RESERVES

Called up share capital

21

7,700

7,700

Hedging reserve

22

(190,088

)

88,116

Retained earnings

22

13,807,531

13,214,276

SHAREHOLDERS' FUNDS

13,625,143

13,310,092

The financial statements were approved by the Board of Directors and authorised for issue on 8 December 2021 and were signed on its behalf by:

Mr D B Aykroyd - Director

Called up

share

Retained

Hedging

Total

capital

earnings

reserve

equity

£

£

£

£

Balance at 1 April 2019

7,700

13,179,386

(18,853

)

13,168,233

Changes in equity

Total comprehensive income

-

34,890

106,969

141,859

Balance at 31 March 2020

7,700

13,214,276

88,116

13,310,092

Changes in equity

Dividends

-

(1,197,700

)

-

(1,197,700

)

Total comprehensive income

-

1,790,955

(278,204

)

1,512,751

Balance at 31 March 2021

7,700

13,807,531

(190,088

)

13,625,143

1.	STATUTORY INFORMATION

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

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

Financial Reporting Standard 102 - reduced disclosure exemptions

The company has taken advantage of the following disclosure exemption in preparing these financial statements, as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":

•

the requirements of Section 7 Statement of Cash Flows.

Significant judgements and estimates

In applying the company's accounting policies, the directors are required to make judgements, estimates and assumptions in determining the carrying amounts of assets and liabilities. The directors' judgements, estimates and assumptions are based on the best and most reliable evidence available at the time when the decisions are made, and are based on historical experience and other factors that are considered to be applicable. Due to the inherent subjectivity involved in making such judgements, estimates and assumptions, the actual results and outcomes may differ.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revision 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.

Key sources of estimation uncertainty

The key assumptions concerning the future, and other key sources of estimation uncertainty, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are disclosed below.

Assessing indicators of impairment

In assessing whether there have been any indicators of impairment assets, the directors have considered both external and internal sources of information such as market conditions and experience of recoverability. There have been no indicators of impairments identified during the current financial year.

Tangible fixed assets

Tangible fixed assets, are depreciated over their useful lives taking into account residual values, where appropriate. The actual lives of the assets and residual values are assessed annually and may vary depending on a number of factors. In re-assessing asset lives, factors such as technological innovation, product life cycles and maintenance programmes are taken into account. Residual value assessments consider issues such as future market conditions, the remaining life of the asset and projected disposal values.

Turnover

Turnover is measured at fair value of the consideration received or receivable, excluding discounts, rebates and value added tax from the provision of goods and services which fall within the company's ordinary activity. The directors consider the business to comprise a single activity.

Bank interest is recognised in the period in which it was received.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.

Freehold property

-

2% on reducing balance

Leasehold property

-

20% on cost

Plant and machinery

-

20% on reducing balance

Fixtures and fittings

-

10% on reducing balance

Motor vehicles

-

33.33% on reducing balance

Investment property

Investment property is shown at most recent valuation. Any aggregate surplus or deficit arising from changes in fair value is recognised in profit or loss.

Stocks

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Foreign currencies

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.

Leasing commitments

Amounts payable under operating leases are charged to the profit and loss account in the period in which they are incurred.

Pension costs and other post-retirement benefits

The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate.

Investments

Fixed asset investments are shown at cost less provision for impairment. Current asset investments are stated at lower of cost and net realisable value.

Government grants

Government grants relating to tangible fixed assets are treated as deferred income and released to the profit and loss account over the expected useful lives of the assets concerned. Other grants are credited to the profit and loss account as the related expenditure is incurred.

Financial instruments

The company uses forward currency contracts to reduce exposure to foreign exchange rates.

The company considers it qualifies for hedge accounting when certain criteria are met :

Forward foreign currency contracts

The criteria for forward currency contracts are

- the instrument must be related to expected purchases in foreign currency,

- it must involve the same currency as the hedged item, and

- it must reduce the risk of foreign currency exchange movements in the company's operations

Foreign exchange forward contracts have been recognised at fair value at the end of the year with changes in fair value recognised in the hedging reserve.

Going concern

The company's financial statements for the year ended 31 March 2021 have been prepared on a going concern basis as, after making appropriate enquiries, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future.

3.

TURNOVER

The turnover and profit before taxation are attributable to the one principal activity of the company.

An analysis of turnover by geographical market is given below:

2021

2020

£

£

United Kingdom

54,552,612

52,688,183

EC member states

2,585,082

2,704,076

57,137,694

55,392,259

4.	EMPLOYEES AND DIRECTORS

2021

2020

£

£

Wages and salaries

3,012,213

3,150,197

Social security costs

280,790

298,202

Other pension costs

146,244

152,311

3,439,247

3,600,710

The average number of employees during the year was as follows:

2021

2020

Selling and distribution

105

113

Office and management

10

10

115

123

2021

2020

£

£

Directors' remuneration

475,925

524,258

Directors' pension contributions to money purchase schemes

71,174

71,048

The number of directors to whom retirement benefits were accruing was as follows:

Money purchase schemes

7

8

Information regarding the highest paid director is as follows:

2021

2020

£

£

Emoluments etc

87,597

98,391

Pension contributions to money purchase schemes

2,774

2,648

5.	OPERATING PROFIT

The operating profit is stated after charging/(crediting):

2021

2020

£

£

Depreciation - owned assets

255,069

296,598

(Profit)/loss on disposal of fixed assets

(22,790

)

21,828

Auditors' remuneration

24,700

24,200

Foreign exchange differences

(15,273

)

(27,582

)

Deferred grant

(8,673

)

(8,850

)

Operating lease - land and buildings

26,000

26,000

6.

AMOUNTS WRITTEN OFF INVESTMENTS

2021

2020

£

£

Amounts written off fixed asset investments

229,246

-

7.

INTEREST PAYABLE AND SIMILAR EXPENSES

2021

2020

£

£

Bank interest

23

6,097

Other interest

484

1,207

507

7,304

8.

TAXATION

Analysis of the tax charge

The tax charge on the profit for the year was as follows:

2021

2020

£

£

Current tax:

UK corporation tax

514,713

48,915

Deferred tax

-

(7,739

)

Tax on profit

514,713

41,176

Reconciliation of total tax charge included in profit and loss

The tax assessed for the year is higher than the standard rate of corporation tax in the UK. The difference is explained below:

2021

2020

£

£

Profit before tax

2,305,668

76,066

Profit multiplied by the standard rate of corporation tax in the UK of 19% (2020 - 19%)

438,077

14,453

Effects of:

Expenses not deductible for tax purposes

8,473

17,720

Depreciation in excess of capital allowances

24,606

9,003

Amounts written off fixed asset investments

43,557

-

Total tax charge

514,713

41,176

Tax effects relating to effects of other comprehensive income

2021

Gross

Tax

Net

£

£

£

Movement on hedging reserve

(298,873

)

20,669

(278,204

)

2020

Gross

Tax

Net

£

£

£

Movement on hedging reserve

131,499

(24,530

)

106,969

9.

DIVIDENDS

2021

2020

£

£

Ordinary shares of £1 each

Interim

1,197,700

-