ACCOUNTS - Final Accounts

ACCOUNTS - Final Accounts

BENROSS MARKETING LIMITED - Company Information

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Registered number: 03037336









BENROSS MARKETING LIMITED









ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 JANUARY 2023
 
BENROSS MARKETING LIMITED
 
 
COMPANY INFORMATION


Directors
DV Juneja 
A Juneja 




Registered number
03037336



Registered office
22 Goodlass Road

Liverpool

Merseyside

L24 9HJ




Independent auditors
Harris & Trotter LLP

101 New Cavendish Street

London

W1W 6XH




 
BENROSS MARKETING LIMITED
 

CONTENTS



Page
Strategic report
1 - 2
Directors' report
3 - 5
Independent auditors' report
6 - 9
Statement of comprehensive income
10
Statement of financial position
11
Statement of changes in equity
12 - 13
Statement of cash flows
14 - 15
Analysis of net debt
16
Notes to the financial statements
17 - 30

 
BENROSS MARKETING LIMITED
 
 
STRATEGIC REPORT
FOR THE YEAR ENDED 31 JANUARY 2023

Business review
 

2023
2022
      £'000
      £'000
Turnover

31,651

31,601
 
Gross Profit

7,319

7,774
 
Operating profit

924

2,710
 
Profit before taxation

731

2,627
 

The board is pleased with the financial performance for the year ended 31st January 2023 considering the impact that macroeconomic factors and the global shipping crisis have had on the business. 
Turnover for the year under review was £31.7m, a 0.2% increase on the prior year (2022: £31.6m). The main source of revenue continued to be from the sale of electrical appliances, contributing 40% of the total turnover (2022: 39%). With energy costs rising, consumers sought energy efficient products such as air-fryers and electric blankets, so sales of these items were higher than expected. The biggest growth in revenue was seen in the Tors+Olsson range of cooling devices and air purifiers. Revenue from the range increased by 52% on the prior year. The weather of summer 2022 was exceptionally hot which generated more demand from consumers for these products.
Gross profit margin decreased slightly to 23% (2022: 24%). Given the astronomically high sea freight costs experienced recently this is considered to be a great result. While gross profit margin remained fairly consistent, operating profit margin reduced to 2.9% (2022: 8.5%). Distribution and administration costs both increased on the prior year. This was a result of external factors such as high interest rates and inflation increasing prices from suppliers.  Finance charges were a significant expense within the year also. Operating profit was lowered further by the reduction in other operating income, which is the overall gain achieved on foreign currency exchanges. The weakening of the sterling against the US dollar greatly reduced these gains within the year. This resulted in an EBITDA of £1.1m (2022: £2.9m) for the year to 31st January 2023. Given the unfavourable macroeconomic factors and the resulting market instability the board is very happy with the financial performance.
Working capital management  remained a key focus for the business. The accounts department harnessed relationships with customers and suppliers alike to reduce the cash cycle as much as possible. The cash balance at 31st January 2023 was £0.02m (2022: £1.3m). It was a strategic decision to utilise less of the finance facility and instead use more of the cash reserves to operate, with interest rates on borrowing being higher than the interest rates on savings.
The board continued to grow the reserves of the Company, with shareholders’ funds now at £13.9m (2022: £13.5m).  The statement of financial position continued to strengthen and the company continues to operate comfortable within its banking covenants.

Page 1
 
BENROSS MARKETING LIMITED
 

STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023

Principal risks and uncertainties
 
The risks outlined below are the principal risks faced by the Company in achieving its objectives; the  list  is  not exhaustive nor does it reflect any order of priority:
Internal
- Poor working capital management
- Poor investment decisions
- Ineffective operations
External
- Macroeconomic factors
- Supply chain continuation
- Credit risk
The responsibility for risk management and the internal control environment  resides  with the board of directors. Risks and the strategies to mitigate them are reviewed at all board meetings then communicated to all relevant stakeholders. The senior management team implements and maintains the control systems adopted by the board.


This report was approved by the board and signed on its behalf.



DV Juneja
Director

Date: 15 June 2023

Page 2
 
BENROSS MARKETING LIMITED
 
 
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 JANUARY 2023

The directors present their report and the financial statements for the year ended 31 January 2023.

Directors' responsibilities statement

The directors are responsible for preparing the Strategic report, the Directors' report 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 for the Company's financial statements and then apply them consistently;

∙make judgments and accounting estimates that are reasonable and prudent;

∙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 to 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.

Principal activity

The principal activity of the Company continued to be the research and design, sourcing, importing and distributing of homewares, electrical appliances, camping and seasonal products.

Results

The profit for the year, after taxation, amounted to £524,722 (2022 - £2,122,227).

Directors

The directors who served during the year were:

DV Juneja 
A Juneja 

Page 3
 
BENROSS MARKETING LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023

Future developments

The key objectives remain constant for the forthcoming year in continuing to grow sales in the UK as well as building distribution networks in Europe and the US.
Growth in the UK will primarily come from expanding existing relationships with strategic customers as well as onboarding new retailers. This will involve both own brand SDAs as well as premium licenced product ranges. New licence and distribution agreements will be explored to expand the product offering and reach new markets.
With a distribution hub now operational in Europe, the Company is looking to engage with and onboard distribution partners in the key European markets. A distribution partner has been secured in the US and in the year ahead the aim is to engage with other potential partners as well as building direct trading relationships with retailers. The US in particular offers huge growth potential for the Company due to the size of the market as well as a minimised exposure to exchange rates, as both purchasing and sales will be both conducted in US Dollar.
Thankfully, ocean shipping rates are reducing, and whilst not yet at pre-pandemic levels, they are much closer to what they were. This will enable the buying team to recommence purchasing products that had become commercially unviable therefore restoring the number of products offered. Although ocean freight is becoming cheaper, consumables are becoming more expensive as inflation continues to rise. The business will focus on trying to reduce overheads where possible in the year ahead to maintain profitability. 
With travel restrictions now eased, the buying team will visit several international fairs to proactively source new products. New product design suffered in recent years as the buying team couldn’t travel to the Far East. Now this is possible, the business will look to develop new products in the coming months which will help keep the offering to customers fresh and on trend.
It was a difficult year with ocean freight prices being so high, inflation and unfavourable exchange rates but the board believes that the company has weathered the storm and views the future with confidence and excitement. 

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 ought to have  taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

Post balance sheet events

There have been no significant events affecting the Company since the year end.

Auditors

The auditors, Harris & Trotter LLP, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

Page 4
 
BENROSS MARKETING LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023

This report was approved by the board and signed on its behalf.
 





DV Juneja
Director

Date: 15 June 2023

Page 5
 
BENROSS MARKETING LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF BENROSS MARKETING LIMITED
 

Opinion


We have audited the financial statements of Benross Marketing Limited (the 'Company') for the year ended 31 January 2023, which comprise the Statement of comprehensive income, the Statement of financial position, the Statement of cash flows, the Statement of changes in equity and the related notes, 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 January 2023 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 United Kingdom, including the Financial Reporting Council'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.


Page 6
 
BENROSS MARKETING LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF BENROSS MARKETING LIMITED (CONTINUED)


Other information


The other information comprises the information included in the Annual Report other than the financial statements and  our Auditors' report thereon.  The directors are responsible for the other information contained within the Annual Report.  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. 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 course of 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.


Opinion 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 Directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
∙the Strategic report and the Directors' report 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 Directors' report.


We have nothing to report in respect of the following matters in relation to which 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 Directors' responsibilities statement set out on page 3, 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 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 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.


Page 7
 
BENROSS MARKETING LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF BENROSS MARKETING LIMITED (CONTINUED)


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 an Auditors' 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:

The objectives of our audit are to identify and assess the risks of material misstatement of the financial
statements due to fraud or error; to obtain sufficient appropriate audit evidence regarding the assessed risks of
material misstatement due to fraud or error; and to respond appropriately to those risks. Owing to the inherent
limitations of an audit, there is an unavoidable risk that material misstatements in the financial statements may
not be detected, even though the audit is properly planned and performed in accordance with the ISAs (UK).
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and noncompliance with laws and regulations, our procedures included the following:
• We obtained an understanding of the legal and regulatory frameworks applicable to the Company and the
  industry in which it operates. We determined that the following laws and regulations were most significant: 
  FRS102 and the Companies Act 2006.
• We obtained an understanding of how the Company is complying with those legal and regulatory frameworks
  by making enquiries of management.
• We challenged assumptions and judgments made by management in its significant accounting estimates.
We did not identify any key audit matters relating to irregularities, including fraud.
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
Auditors' Report.


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 Auditors' report.


Page 8
 
BENROSS MARKETING LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF BENROSS MARKETING LIMITED (CONTINUED)


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 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 members, as a body, for our audit work, for this report, or for the opinions we have formed.





Jamie Taylor (Senior statutory auditor)
  
for and on behalf of
Harris & Trotter LLP
 
101 New Cavendish Street
London
W1W 6XH

15 June 2023
Page 9
 
BENROSS MARKETING LIMITED
 
 
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 JANUARY 2023

2023
2022
Note
£
£

  

Turnover
 4 
31,651,086
31,600,754

Cost of sales
  
(24,331,973)
(23,826,496)

Gross profit
  
7,319,113
7,774,258

Distribution costs
  
(1,656,023)
(1,406,735)

Administrative expenses
  
(4,897,928)
(4,403,538)

Other operating income
 5 
155,438
746,418

Operating profit
  
920,600
2,710,403

Interest payable and similar expenses
 9 
(193,020)
(82,647)

Profit before tax
  
727,580
2,627,756

Tax on profit
 10 
(202,858)
(505,529)

Profit for the financial year
  
524,722
2,122,227

Other comprehensive income for the year
  

Total comprehensive income for the year
  
524,722
2,122,227

The notes on pages 17 to 30 form part of these financial statements.

Page 10
 
BENROSS MARKETING LIMITED
REGISTERED NUMBER: 03037336

STATEMENT OF FINANCIAL POSITION
AS AT 31 JANUARY 2023

2023
2022
Note
£
£

Fixed assets
  

Tangible fixed assets
 13 
455,923
586,840

  
455,923
586,840

Current assets
  

Stocks
 14 
10,125,858
8,976,448

Debtors
 15 
13,938,617
13,138,819

Cash at bank and in hand
 16 
16,689
1,283,925

  
24,081,164
23,399,192

Creditors: amounts falling due within one year
 17 
(10,548,803)
(10,292,450)

Net current assets
  
 
 
13,532,361
 
 
13,106,742

Total assets less current liabilities
  
13,988,284
13,693,582

Provisions for liabilities
  

Deferred tax
  
(113,980)
(104,000)

  
 
 
(113,980)
 
 
(104,000)

Net assets
  
13,874,304
13,589,582


Capital and reserves
  

Called up share capital 
 19 
1,000
1,000

Profit And Loss Account
 20 
13,873,304
13,588,582

  
13,874,304
13,589,582


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 




DV Juneja
Director

Date: 15 June 2023

The notes on pages 17 to 30 form part of these financial statements.

Page 11
 
BENROSS MARKETING LIMITED
 

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JANUARY 2023


Called up share capital
Profit and loss account
Total equity

£
£
£

At 1 February 2022
1,000
13,588,582
13,589,582


Comprehensive income for the year

Profit for the year

-
524,722
524,722


Other comprehensive income for the year
-
-
-


Total comprehensive income for the year
-
524,722
524,722


Contributions by and distributions to owners

Dividends: Equity capital
-
(240,000)
(240,000)


Total transactions with owners
-
(240,000)
(240,000)


At 31 January 2023
1,000
13,873,304
13,874,304


The notes on pages 17 to 30 form part of these financial statements.

Page 12
 
BENROSS MARKETING LIMITED
 

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 JANUARY 2022


Called up share capital
Profit and loss account
Total equity

£
£
£

At 1 January 2021
1,000
12,161,355
12,162,355


Comprehensive income for the period

Profit for the period

-
2,122,227
2,122,227


Other comprehensive income for the period
-
-
-


Total comprehensive income for the period
-
2,122,227
2,122,227


Contributions by and distributions to owners

Dividends: Equity capital
-
(695,000)
(695,000)


Total transactions with owners
-
(695,000)
(695,000)


At 31 January 2022
1,000
13,588,582
13,589,582


The notes on pages 17 to 30 form part of these financial statements.

Page 13
 
BENROSS MARKETING LIMITED
 

STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 JANUARY 2023

2023
2022
£
£

Cash flows from operating activities

Profit for the financial year
524,722
2,122,227

Adjustments for:

Depreciation of tangible assets
239,623
222,359

Loss on disposal of tangible assets
(869)
(7,646)

Interest paid
(193,020)
(82,647)

Taxation charge
202,858
505,530

(Increase) in stocks
(1,149,411)
(3,338,964)

Decrease/(increase) in debtors
840,431
(1,706,036)

(Increase) in amounts owed by associates
(13,528)
(50,749)

Increase in creditors
806,840
1,320,669

Corporation tax (paid)
(371,425)
(218,869)

Forward contracts
-
(252,182)

Finance costs
193,020
82,647

Net cash generated from operating activities

1,079,241
(1,403,661)


Cash flows from investing activities

Purchase of tangible fixed assets
(129,042)
(106,719)

Sale of tangible fixed assets
869
11,500

Net cash from investing activities

(128,173)
(95,219)

Cash flows from financing activities

New secured loans
223,475
(803,633)

Dividends paid
(240,000)
(695,000)

Associated company lending
(1,201,547)
(459,321)

Short term stock financing
(606,868)
803,634

Amount withdrawn by directors
-
98,059

Net cash used in financing activities
(1,824,940)
(1,056,261)

Net (decrease) in cash and cash equivalents
(873,872)
(2,555,141)

Cash and cash equivalents at beginning of year
(4,536,838)
(1,981,696)

Cash and cash equivalents at the end of year
(5,410,710)
(4,536,837)

Page 14
 
BENROSS MARKETING LIMITED
 

STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 JANUARY 2023


2023
2022

£
£


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
16,689
1,283,925

Bank overdrafts
(5,427,399)
(5,820,762)

(5,410,710)
(4,536,837)


The notes on pages 17 to 30 form part of these financial statements.

Page 15
 
BENROSS MARKETING LIMITED
 

ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 JANUARY 2023




At 1 February 2022
Cash flows
At 31 January 2023
£

£

£

Cash at bank and in hand

1,283,925

(1,267,236)

16,689

Bank overdrafts

(5,820,762)

393,363

(5,427,399)

Debt due within 1 year

-

(200,547)

(200,547)


(4,536,837)
(1,074,420)
(5,611,257)

The notes on pages 17 to 30 form part of these financial statements.

Page 16
 
BENROSS MARKETING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

1.


General information

Benross Marketing Limited is a company limited by shares and incorporated and domiciled in England & Wales (registered number: 03037336).  The registered office is located at Benross House, 22 Goodlass Road, Liverpool, L24 9HJ.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies (see note 3).

The following principal accounting policies have been applied:

 
2.2

Going concern

In determining whether the Company's accounts can be prepared on a going concern basis, the directors considered the Company's business activities together with factors likely to affect its future development, performance and its financial position including cash flows, liquidity position and borrowing facilities and the principal risks and uncertainties relating to its activities.
The Company is expected to generate independent positive cash flows for the foreseeable future.  Monthly forecasts have been prepared for the business going forward for the short-medium term.  These forecasts after sensitivities assume that the profitability of the Company grows in accordance with the detailed business plan which has been approved by the board.
The forecasts for the Company indicate ongoing compliance with all covenants attached to associated bank debt.
The Company therefore continues to adopt the going concern basis in preparing its financial statements.

Page 17
 
BENROSS MARKETING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

2.Accounting policies (continued)

 
2.3

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:

Sale of goods

Revenue from the sale of goods is recognised when all of the following conditions are satisfied:
∙the Company has transferred the significant risks and rewards of ownership to the buyer;
∙the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
∙the amount of revenue can be measured reliably;
∙it is probable that the Company will receive the consideration due under the transaction; and
∙the costs incurred or to be incurred in respect of the transaction can be measured reliably.

 
2.4

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

 
2.5

Borrowing costs

All borrowing costs are recognised in profit or loss in the year in which they are incurred.

 
2.6

Pensions

Defined contribution pension plan

The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.

The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of financial position. The assets of the plan are held separately from the Company in independently administered funds.

Page 18
 
BENROSS MARKETING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

2.Accounting policies (continued)

 
2.7

Current and deferred taxation

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

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 income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the reporting date, except that:
∙The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
∙Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.

 
2.8

Intangible assets

Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

Software Development Costs
Software and associated costs are capitalised as intangible assets where it is not an integral part of the related hardware at purchase cost and amortised in the profit & loss account to administrative expenses  on a straight  line basis over its useful economic life which is generally 3 to 5 years. Development costs that are directly attributable to the design and testing of identifiable and unique software products controlled by the company are recognised as intangible assets. Development expenditures that do not meet our criteria are expensed as incurred.
Costs incurred developing the company's own brands are expensed as incurred.  Separately  acquired trademarks are shown at historical cost. Trademarks have a finite useful life and are carried at cost less accumulated amortisation.
Amortisation is charged so as to allocate the cost of intangibles less their residual values over their estimated useful lives, using the straight-line method. The intangible assets are amortised over the following useful economic lives:
Software development costs 3-5 years

Page 19
 
BENROSS MARKETING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

2.Accounting policies (continued)

 
2.9

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.

Depreciation is provided on the following basis:

Leasehold improvements
-
10%
on cost
Plant and machinery
-
25%
on cost
Motor vehicles
-
25%
on cost
Fixtures and fittings
-
25%
on cost
Computer equipment
-
25%
on cost

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

 
2.10

Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads.

At each reporting date, stocks are assessed for impairment. If stock is 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.

 
2.11

Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

 
2.12

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

In the Statement of cash flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Company's cash management.

Page 20
 
BENROSS MARKETING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

2.Accounting policies (continued)

 
2.13

Creditors

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

 
2.14

Provisions for liabilities

Provisions are made where an event has taken place that gives the Company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.
Provisions are charged as an expense to profit or loss in the year that the Company becomes aware of the obligation, and are measured at the best estimate at the reporting date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.
When payments are eventually made, they are charged to the provision carried in the Statement of financial position.

 
2.15

Financial instruments

The Company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.

 
2.16

Dividends

Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting.


3.


Judgments in applying accounting policies and key sources of estimation uncertainty

Preparation of the financial statements requires management to make significant judgements and estimates.  The items in the financial statements where these judgements and estimates have been made include:
Inventory provisions
Estimations have been made in respect of the carry value of aged inventories.  Where NRV is estimated to be below cost an adjustment to the carrying value is provided for.  As at 31 January 2023 the inventory provision was £909,933 (2022: £1,262,204).
Onerous contract provisions
Estimations have been made for the carrying value of onerous contracts including onerous leases and dilapidation provisions.  If management believe the aggregate cost required to fulfil the agreement is higher than the economic benefit to be obtained an adjustment to the carrying value is provided for.  As at 31 January 2023 the onerous contract provision was £nil (2022: £nil).
Capital commitments
Estimations have been made for the value of capital expenditure.  As at 31 January 2023 the capital expenditure provision was £nil (2022: £nil).

Page 21
 
BENROSS MARKETING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

4.


Turnover

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

2023
2022
£
£

United Kingdom
29,881,992
29,465,259

Europe
1,655,818
2,015,080

United States of America
19,948
12,616

South America
93,328
107,799

31,651,086
31,600,754



5.


Other operating income

2023
2022
£
£

Other operating income
155,438
746,418

155,438
746,418



6.


Auditors' remuneration

2023
2022
£
£

Fees payable to the Company's auditors for the audit of the Company's financial statements
15,000
10,054
Page 22
 
BENROSS MARKETING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

7.


Employees

Staff costs, including directors' remuneration, were as follows:


2023
2022
£
£

Wages and salaries
1,989,087
1,826,812

Social security costs
168,999
158,041

Cost of defined contribution scheme
83,796
74,609

2,241,882
2,059,462


The average monthly number of employees, including the directors, during the year was as follows:


        2023
        2022
            No.
            No.







Management
4
4



Administrative
21
29



Distribution
27
29



Sales
12
9

64
71


8.


Directors' remuneration

2023
2022
£
£

Directors' remuneration
31,727
31,702

31,727
31,702



9.


Interest payable and similar expenses

2023
2022
£
£


Bank interest payable
193,020
82,647

193,020
82,647

Page 23
 
BENROSS MARKETING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

10.


Taxation


2023
2022
£
£

Corporation tax


Current tax on profits for the year
192,878
505,529


192,878
505,529


Total current tax
192,878
505,529

Deferred tax


Changes to tax rates
9,980
-

Total deferred tax
9,980
-


Taxation on profit on ordinary activities
202,858
505,529

Factors affecting tax charge for the year/period

The tax assessed for the year is the same as the standard rate of corporation tax in the UK of 19%, as set out below:

2023
2022
£
£


Profit on ordinary activities before tax
727,580
2,627,756


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 19% (2022 - 19%)
138,240
499,274

Effects of:


Capital allowances for year/period in excess of depreciation
19,451
6,255

Short-term timing difference leading to an increase (decrease) in taxation
9,980
-

Non-taxable income less expenses not deductible for tax purposes, other than goodwill and impairment
2,303
-

Other differences leading to an increase (decrease) in the tax charge
32,884
-

Total tax charge for the year/period
202,858
505,529


Factors that may affect future tax charges

Page 24
 
BENROSS MARKETING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023
 
10.Taxation (continued)

As from 1 April 2023 - the Corporation tax main rate rate was increased to 25% applying to profits over
£250,000.


11.


Dividends

2023
2022
£
£


Dividends paid
240,000
695,000

240,000
695,000


12.


Intangible assets




Computer software

£



Cost


At 1 February 2022
93,345



At 31 January 2023

93,345



Amortisation


At 1 February 2022
93,345



At 31 January 2023

93,345



Net book value



At 31 January 2023
-



At 31 January 2022
-



Page 25
 
BENROSS MARKETING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

13.


Tangible fixed assets





Leasehold improvements
Plant and machinery
Motor vehicles
Fixtures and fittings
Computer equipment

£
£
£
£
£



Cost or valuation


At 1 February 2022
40,070
353,490
113,159
433,385
86,041


Additions
-
10,626
101,680
11,258
5,477


Disposals
-
-
-
-
(2,414)



At 31 January 2023

40,070
364,116
214,839
444,643
89,104



Depreciation


At 1 February 2022
6,441
170,257
44,596
194,095
23,915


Charge for the year on owned assets
-
72,941
54,516
108,193
19,433


Charge for the year on financed assets
4,007
-
-
-
-


Disposals
-
-
-
-
(1,545)



At 31 January 2023

10,448
243,198
99,112
302,288
41,803



Net book value



At 31 January 2023
29,622
120,918
115,727
142,355
47,301



At 31 January 2022
33,628
183,233
68,563
239,290
62,126
Page 26
 
BENROSS MARKETING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

           13.Tangible fixed assets (continued)


Total

£



Cost or valuation


At 1 February 2022
1,026,145


Additions
129,041


Disposals
(2,414)



At 31 January 2023

1,152,772



Depreciation


At 1 February 2022
439,304


Charge for the year on owned assets
255,083


Charge for the year on financed assets
4,007


Disposals
(1,545)



At 31 January 2023

696,849



Net book value



At 31 January 2023
455,923



At 31 January 2022
586,840


14.


Stocks

2023
2022
£
£

Finished goods and goods for resale
10,125,858
8,976,448

10,125,858
8,976,448


Stock recognised in cost of sales during the year as an expense was £19,850,454 (2022: £18,722,220).
A gain of £352,271 (2022: loss of £776,912) was recognised in cost of sales against stock during the year due to obsolete stock being sold to a clearance customer.
The total carrying amount of stock is pledged as security for the group's bank loans.

Page 27
 
BENROSS MARKETING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

15.


Debtors

2023
2022
£
£

Due after more than one year

Amounts owed by joint ventures and associated undertakings
5,786,338
5,772,810

5,786,338
5,772,810

Due within one year

Trade debtors
6,382,689
6,783,446

Amounts owed by joint ventures and associated undertakings
1,545,047
343,500

Other debtors
23,153
89,985

Prepayments and accrued income
201,390
149,078

13,938,617
13,138,819



16.


Cash and cash equivalents

2023
2022
£
£

Cash at bank and in hand
16,689
1,283,925

Less: bank overdrafts
(5,427,399)
(5,820,762)

(5,410,710)
(4,536,837)



17.


Creditors: Amounts falling due within one year

2023
2022
£
£

Bank overdrafts
5,427,399
5,820,762

Trade creditors
1,906,639
1,455,727

Corporation tax
361,239
518,361

Other taxation and social security
1,009,173
280,255

Other creditors
508,165
-

Accruals and deferred income
1,336,188
2,217,345

10,548,803
10,292,450


Page 28
 
BENROSS MARKETING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

18.


Deferred taxation




2023


£






At beginning of year
(104,000)


Charged to profit or loss
(9,980)



At end of year
(113,980)

The provision for deferred taxation is made up as follows:

2023
2022
£
£


Accelerated capital allowances
(113,981)
(104,000)

(113,981)
(104,000)


19.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



250 (2022 - 250) Ordinary A shares of £1.00 each
250
250
250 (2022 - 250) Ordinary B shares of £1.00 each
250
250
100 (2022 - 100) Ordinary C shares of £1.00 each
100
100
100 (2022 - 100) Ordinary D shares of £1.00 each
100
100
100 (2022 - 100) Ordinary E shares of £1.00 each
100
100
100 (2022 - 100) Ordinary F shares of £1.00 each
100
100
100 (2022 - 100) Ordinary G shares of £1.00 each
100
100

1,000

1,000

The share rights of the ordinary A to G shares shall rank pari passu in all respects but shall constitute separate classes of shares.
In any financial year as regards to the available profits of the Company that the board determine to distribute, the board may make payments to one or more classes of shares to the exclusion of the other classes of shares.


Page 29
 
BENROSS MARKETING LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JANUARY 2023

20.


Reserves

Profit and loss account

This reserve records retained earnings and accumulated losses.


21.


Related party transactions

2023
2022
£
£



Purchases from associates
6,928,688
6,883,462

Sales to associates
1,026,412
1,015,002

Loans provided to associates
1,215,075
226,431

Loans repaid by associates
-
175,682

Trade creditors amounts due to associates
(596,553)
(561,224)

Loans due from associates
7,331,385
6,116,310

Trade debtors due from associates
395,868
1,137,465

Dividends paid to directors
240,000
695,000

Rent charged by associates
535,000
-

Key managemet personnel compensation
31,727
31,702

 
Page 30