MSGM London Limited - Period Ending 2021-12-31

MSGM London Limited

Contents

Company Information	1
Statement of Financial Position	2
Notes to the Financial Statements	3 to 7

MSGM London Limited

Company Information

Director

M Paoloni

Registered office

86 Jermyn Street London SW1Y 6AW

Auditor

Brebners Chartered Accountants & Statutory Auditor 130 Shaftesbury Avenue London W1D 5AR

MSGM London Limited

Statement of Financial Position as at 31 December 2021

	Note	2021 £	(As restated) 2020 £
Fixed assets
Tangible assets	5	316,030	407,887
Current assets
Stocks	6	255,190	285,225
Debtors	7	413,528	326,192
Cash at bank and in hand		278,880	219,474
		947,598	830,891
Creditors: Amounts falling due within one year	8	(1,247,761)	(2,493,144)
Net current liabilities		(300,163)	(1,662,253)
Net assets/(liabilities)		15,867	(1,254,366)
Capital and reserves
Called up share capital		1,586,234	100
Retained earnings		(1,570,367)	(1,254,466)
Shareholders' funds/(deficit)		15,867	(1,254,366)

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 and in accordance with FRS 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'.

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 Statement of Income and Retained Earnings has been taken.

Approved and authorised by the director on 31 March 2023
 

.........................................

M Paoloni

Director

Company registration number: 11175872

MSGM London Limited

Notes to the Financial Statements for the Year Ended 31 December 2021

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:
86 Jermyn Street
London
SW1Y 6AW

The principal activity of the company is that of the retail sale of clothing.

2	Audit Report

The Independent Auditor's Report contained the following qualified opinion:

"We were not appointed as auditor of the company until after 31 December 2021 and thus did not observe the counting of physical inventories at the end of the year. We were unable to satisfy ourselves by alternative means concerning the inventory quantities held at 31 December 2021, which are included in the statement of financial position at £255,190, by using other audit procedures. "

The name of the Senior Statutory Auditor who signed the audit report on 31 March 2023 was Martin Widdowson, who signed for and on behalf of Brebners.

3	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 - 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' and the Companies Act 2006.

Basis of preparation

These financial statements have been prepared using the historical cost convention except any items disclosed in the accounting policies as being shown at fair value and are presented in sterling, which is the functional currency of the entity.

Going concern

The company made a loss for the year ended 31 December 2021 but had assets at that date of £15,867. At that date an amount of £563,782 was due to the parent undertaking who has agreed to not call for repayment until such time as the company has sufficient working capital.

The company operates within the retail sector which was severely impacted by pandemic restrictions on store opening and interaction with customers. During the financial year to 31 December 2021 and subsequently, revenue has continued to improve following the lifting of restrictions.

The director has considered the potential effect of the pandemic and believes that there will be no material impact on the ability of the company to continue as a going concern.

On the basis of the above, and after making enquiries, the director has a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Accordingly, the director continues to adopt the going concern basis in preparing the financial statements.

MSGM London Limited

Notes to the Financial Statements for the Year Ended 31 December 2021

Revenue recognition

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

The company recognises revenue from the sale of goods at the point of sale and from online sales when the goods are despatched and payment made, when the amount can be reliably measured and it is probable that future economic benefits will flow.

Government grants

Government grants are recognised when it is reasonable to expect that he grants will be received and that all related conditions will be met, usually on submission of a valid claim for payment.

Grants of a revenue nature are credited to income so as to match them with the expenditure to which they relate.

Foreign currency transactions and balances

Transactions in foreign currencies are initially recorded at the functional currency rate prevailing at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated into the respective functional currency of the entity at the rates prevailing on the reporting period date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rate on the date when the fair value is re-measured.

Non-monetary items measured in terms of historical cost in a foreign currency are not retranslated.

Tangible assets

Tangible assets are stated in the statement of financial position 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
Leasehold property	Over the lease period
Furniture, fittings and equipment	5 years straight line
Computer equipment	3 years straight line
Plant and machinery	10 years straight line

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.

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 comprises direct materials and, where applicable, 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 sell; the impairment loss is recognised immediately in profit or loss.

MSGM London Limited

Notes to the Financial Statements for the Year Ended 31 December 2021

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.

Defined contribution pension obligation

A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the company has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.

Contributions to defined contribution plans are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.

4	Staff numbers

The average number of persons employed by the company during the year, was 4 (2020 - 3).

5	Tangible assets

	Leasehold improvements £	Furniture, fittings and equipment  £	Computer equipment  £	Plant and machinery £	Total £
Cost or valuation
At 1 January 2021	236,257	221,282	5,799	235,135	698,473
Additions	-	3,900	-	-	3,900
Disposals	(590)	-	-	(2,993)	(3,583)
At 31 December 2021	235,667	225,182	5,799	232,142	698,790
Depreciation
At 1 January 2021	79,614	134,691	5,741	70,540	290,586
Charge for the year	23,566	45,036	58	23,514	92,174
At 31 December 2021	103,180	179,727	5,799	94,054	382,760
Carrying amount
At 31 December 2021	132,487	45,455	-	138,088	316,030
At 31 December 2020	156,643	86,591	58	164,595	407,887

6

Stocks

	2021 £	2020 £
Stock	255,190	285,225

MSGM London Limited

Notes to the Financial Statements for the Year Ended 31 December 2021

7

Debtors

	2021 £	(As restated) 2020 £
Trade debtors	67,938	66,521
Other debtors	345,590	259,671
	413,528	326,192
Less non-current portion	(225,000)	(225,000)
	188,528	101,192

8

Creditors

Creditors: amounts falling due within one year

	2021 £	(As restated) 2020 £
Trade creditors	591,467	864,681
Amounts due to group undertakings	563,782	1,580,330
Taxation and social security	-	5,456
Other creditors	92,512	42,677
	1,247,761	2,493,144

9	Financial commitments, guarantees and contingencies

Amounts not provided for in the statement of financial position

The total amount of financial commitments not included in the statement of financial position is £1,875,000 (2020 - £2,072,917).

10	Related party transactions

Exemption is taken under FRS 102 1AC.35 not to disclose transactions or amounts falling due with undertakings wholly owned within the group.

11	Parent and ultimate parent undertaking

The company's immediate parent is MSGML SRL, incorporated in Italy.

 The largest and smallest group producing publicly available financial statements including the results of the company is headed by MSGML SRL. These financial statements are available upon request from the registered office address which is, Viale Piceno, 17 – 20129, Milano, Italy.

12	Transition to FRS 102

The company transitioned to FRS 102 from FRS 105 on 1st January 2021. There were no adjustments required on transition.

MSGM London Limited

Notes to the Financial Statements for the Year Ended 31 December 2021

13	Prior period adjustment

During the year the director identified that there were a number of errors in the previous years financial statements. These were adjusted for in the current year and the comparatives restated.

1) An issue of 1,000,000 ordinary shares of £1 each amounting to £1,000,000 in March 20201 was incorrectly recognised

2) In the previous year commission payable of £20,093 had not been included in the financial statements

3) In the previous year lease incentives and temporary covid rent reductions were incorrectly accounted for.

4) In 2018 a payment to a trade creditor was incorrectly treated as an addition to fixed assets.

The combined effect of the restatements above is that the net assets at 31 December 2020 are £54,815 less than previously stated and the result for the year then ended is £50,329 less than previously stated.