Harlows Kidderminster LLP - LLP accounts 23.2

REGISTERED NUMBER: OC330392 (England and Wales)

Report of the Members and

Financial Statements for the Year Ended 30 June 2023

for

Harlows Kidderminster LLP

Page

General Information

1

Report of the Members

2

Report of the Independent Auditors

4

Income Statement

8

Other Comprehensive Income

9

Balance Sheet

10

Reconciliation of Members' Interests

11

Notes to the Financial Statements

13

DESIGNATED MEMBERS:

T J Darby Limited

Marc Stones Limited

Harlow Timber Group Limited

REGISTERED OFFICE:

c/o Harlow Bros Limited

Hathern Road

Long Whatton

Loughborough

Leicestershire

LE12 5DE

REGISTERED NUMBER:

OC330392 (England and Wales)

SENIOR STATUTORY AUDITOR:

Mr Christopher David Hutton FCCA

AUDITORS:

Charnwood Accountants & Business Advisors LLP

Statutory Auditor

The Point

Granite Way

Mountsorrel

Loughborough

Leicestershire

LE12 7TZ

The members present their report with the financial statements of the LLP for the year ended 30 June 2023.

PRINCIPAL ACTIVITY

The principal activity of the LLP in the year under review was that of timber merchants.

DESIGNATED MEMBERS

The designated members during the year under review were:

T R Blount Limited

T J Darby Limited

Marc Stones Limited

Harlow Timber Group Limited

RESULTS FOR THE YEAR AND ALLOCATION TO MEMBERS

The profit for the year before members' remuneration and profit shares was £1,473,745 (2022 - £3,252,590 profit).

MEMBERS' INTERESTS

Profits are allocated between the members in accordance with the partnership agreement, with any undrawn profits included in loans and other debts due to members.

The allocation of profit is at the discretion of the Board in accordance with the formal partner remuneration procedures in place. Each partner shares in profit based on the proportion of units allocated to them. The Board, considers factors which, among others, include the split as determined in the partnership agreement and contribution to, among others, quality, risk, performance and leadership in the determination of the allocation of profits to the individual members.

Profits available for discretionary allocation are classified as equity and included within members’ other reserves.

Amounts due to/(from) members

Current amounts due to and from members are stated at their nominal value, as this approximates to the amortised cost.

Members are entitled to draw a monthly amount against their expected share of the profit during the course of the year. The partners agree the level of members’ monthly drawings. This is taking into account the need to maintain sufficient funds to finance the working capital and other needs of the business.

The final allocation of profits and distribution to members is made after assessing each member’s contribution for the year and once the annual financial statements are approved. Unallocated profits are included in reserves within members’ other reserves in equity.

Where a member’s drawings exceed the actual profit allocation during the year, the net amount due from the member is included under current assets in amounts due from members. If the profit allocation exceeds the members drawing, the net amount is included under current liabilities within amounts due to members. This number is determined on a member-by-member basis. The amounts due to or from members that retired during the current year are classified on the same basis.

STATEMENT OF MEMBERS' RESPONSIBILITIES

The members are responsible for preparing the Report of the Members and the financial statements in accordance with applicable law and regulations.

Legislation applicable to limited liability partnerships requires the members to prepare financial statements for each financial year. Under that law the members have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under legislation applicable to limited liability partnerships the members 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 LLP and of the profit or loss of the LLP for that period. In preparing these financial statements, the members are required to:

-	select suitable accounting policies and then apply them consistently;

-	make judgements 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 LLP will continue in business.

The members are responsible for keeping adequate accounting records that are sufficient to show and explain the LLP's transactions and disclose with reasonable accuracy at any time the financial position of the LLP and enable them to ensure that the financial statements comply with the Companies Act 2006 as applied to LLPs by the Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008. They are also responsible for safeguarding the assets of the LLP 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 members are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the LLP's auditors are unaware, and each member has taken all the steps that he ought to have taken as a member in order to make himself aware of any relevant audit information and to establish that the LLP's auditors are aware of that information.

AUDITORS

The auditors, Charnwood Accountants & Business Advisors LLP, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE MEMBERS:

Harlow Timber Group Limited - Designated member

19 February 2024

Opinion

We have audited the financial statements of Harlows Kidderminster LLP (the 'LLP') for the year ended 30 June 2023 which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Reconciliation of Members' Interests 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 LLP's affairs as at 30 June 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 as applied to LLPs by the Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008.

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 LLP 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 members' 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 LLP'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 members with respect to going concern are described in the relevant sections of this report.

Other information

The members are responsible for the other information. The other information comprises the information in the Report of the Members, 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.

Matters on which we are required to report by exception

We have nothing to report in respect of the following matters where the Companies Act 2006 as applied to LLPs 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

-	we have not received all the information and explanations we require for our audit.

Responsibilities of members

As explained more fully in the Statement of Members' Responsibilities set out on page three, the members 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 members 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 members are responsible for assessing the LLP'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 members either intend to liquidate the LLP 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.

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

Irregularities are instances of non-compliance with laws and regulations. The objectives of our audit are to obtain sufficient appropriate audit evidence regarding compliance with laws and regulations that have a direct effect on the determination of material amounts and disclosures in the Financial Statements, to perform audit procedures to help identify instances of non-compliance with other laws and regulations that may have a material effect on the Financial Statements, and to respond appropriately to identified or suspected non-compliance with laws and regulations identified during the audit.

In relation to fraud, the objectives of our audit are to identify and assess the risk of material misstatement of the Financial Statements due to fraud, to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud through designing and implementing appropriate responses and to respond appropriately to fraud or suspected fraud identified during the audit.

However, it is the primary responsibility of management, with the oversight of those charged with governance, to ensure that the entity's operations are conducted in accordance with the provisions of laws and regulations and for the prevention and detection of fraud. 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). The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any. As such material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment and or collusion.

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

We obtained an understanding of the nature of the industry and sector, including the legal and regulatory frameworks that the Company operate in and how the Company are complying with the legal and regulatory frameworks. 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, pension legislation and UK tax legislation.

We inquired of management, and those charged with governance, about their own identification and assessment of the risks of irregularities, including any known actual, suspected or alleged instances of fraud;

We discussed matters about non-compliance with laws and regulations and how fraud might occur including assessment of how and where the Financial Statements may be susceptible to fraud, having obtained an understanding of the effectiveness of the control environment.

The engagement partner assessed that the engagement team collectively had the appropriate competence and capabilities to identify or recognise non-compliance with laws and regulations.

We assessed the susceptibility of the company's financial statements to material misstatement, including how fraud might occur, by evaluating management's incentives and opportunities for manipulation of the financial statements. This included the evaluation of the risk of management override of controls. In assessing the potential risks of material misstatement, we obtained an understanding of the company's operations, including the nature of its income and expenditure together with its objectives and strategies to understand the classes of transactions, account balances, expected financial statement disclosures and business risks that may result in risks of material misstatement. Also on the company's control environment, including the policies and procedures implemented by the company to ensure compliance with the requirements of the financial reporting framework.

We determined that the principal risk in relation to areas of increased management judgement, which could be impacted by management bias, was through the use of journal entries that increase revenues, profits or the carrying value of property plant and equipment in order to inflate results of the company.

Our audit procedures involved:

The evaluation of the design effectiveness of controls that the company has in place to prevent and detect fraud;

To undertake journal entry testing, with a focus on higher risk journal, such as, posted by senior management, journals with unusual attributes, journals without any descriptions and closing journals posted during the preparation of the financial statements, which are material and not reoccurring or common postings which fall outside of the auditor's expectations. Together with assessing whether the judgments made in making accounting estimates are indicative of a potential bias.

In response to the risk of irregularities and non-compliance with laws and regulations our procedures included, but which were not limited to;

Enquiring of management as to actual and potential litigation and claims against the company;

Completing a review of relevant legal and professional costs within the accounting records for any evidence of previously un-detected or un-reported instances of non-compliance.

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 LLP's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006 as applied to LLPs by the Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008. Our audit work has been undertaken so that we might state to the LLP'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 LLP and the LLP's members as a body, for our audit work, for this report, or for the opinions we have formed.

Mr Christopher David Hutton FCCA (Senior Statutory Auditor)

for and on behalf of Charnwood Accountants & Business Advisors LLP

Statutory Auditor

The Point

Granite Way

Mountsorrel

Loughborough

Leicestershire

LE12 7TZ

19 February 2024

TURNOVER

11,737,220

16,534,769

Cost of sales

8,672,074

11,810,559

GROSS PROFIT

3,065,146

4,724,210

Distribution costs

332,332

412,231

Administrative expenses

1,251,927

1,081,875

1,584,259

1,494,106

1,480,887

3,230,104

Other operating income

3,305

13,341

OPERATING PROFIT

4

1,484,192

3,243,445

Interest receivable and similar income

68,214

9,145

1,552,406

3,252,590

Interest payable and similar expenses

5

78,661

-

PROFIT FOR THE FINANCIAL YEAR BEFORE MEMBERS' REMUNERATION AND PROFIT SHARES AVAILABLE FOR DISCRETIONARY DIVISION AMONG MEMBERS

1,473,745

3,252,590

PROFIT FOR THE FINANCIAL YEAR BEFORE MEMBERS' REMUNERATION AND PROFIT SHARES AVAILABLE FOR DISCRETIONARY DIVISION AMONG MEMBERS

1,473,745

3,252,590

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

1,473,745

3,252,590

FIXED ASSETS

Tangible assets

7

320,226

359,359

CURRENT ASSETS

Stocks

8

1,883,602

2,213,808

Debtors

9

1,808,457

1,864,994

Cash at bank and in hand

2,728,861

3,586,447

6,420,920

7,665,249

CREDITORS

Amounts falling due within one year

10

2,474,160

2,519,233

NET CURRENT ASSETS

3,946,760

5,146,016

TOTAL ASSETS LESS CURRENT LIABILITIES

4,266,986

5,505,375

CREDITORS

Amounts falling due after more than one year

11

2,616,120

2,537,459

NET ASSETS ATTRIBUTABLE TO MEMBERS

1,650,866

2,967,916

LOANS AND OTHER DEBTS DUE TO MEMBERS

12

1,650,836

2,967,886

MEMBERS' OTHER INTERESTS

Capital accounts

30

30

1,650,866

2,967,916

TOTAL MEMBERS' INTERESTS

Loans and other debts due to members

12

1,650,836

2,967,886

Members' other interests

30

30

1,650,866

2,967,916

The financial statements were approved by the members of the LLP and authorised for issue on 19 February 2024 and were signed by:

Harlow Timber Group Limited - Designated member

EQUITY

Members' other interests

Members'

capital

(classified

as

Other

equity)

reserves

Total

£

£

£

Balance at 1 July 2022

30

-

30

Profit for the financial year available for discretionary division among members

-

1,473,745

1,473,745

Members' interests after profit for the year

30

1,473,745

1,473,775

Other divisions of profit

-

(1,473,745

)

(1,473,745

)

Drawings on account and distributions of profit

-

-

-

Balance at 30 June 2023

30

-

30

DEBT

TOTAL

Loans and other debts due to

MEMBERS'

members less any amounts due

INTERESTS

from members in debtors

Other

amounts

Total

£

£

Amount due to members

2,967,886

Amount due from members

-

Balance at 1 July 2022

2,967,886

2,967,916

Profit for the financial year available for discretionary division among members

-

1,473,745

Members' interests after profit for the year

2,967,886

4,441,661

Other divisions of profit

1,473,745

-

Drawings on account and distributions of profit

(2,790,795

)

(2,790,795

)

Amount due to members

1,650,836

Amount due from members

-

Balance at 30 June 2023

1,650,836

1,650,866

EQUITY

Members' other interests

Members'

capital

(classified

as

Other

equity)

reserves

Total

£

£

£

Balance at 1 July 2021

30

-

30

Profit for the financial year available for discretionary division among members

-

3,252,590

3,252,590

Members' interests after profit for the year

30

3,252,590

3,252,620

Other divisions of profit

-

(3,252,590

)

(3,252,590

)

Drawings on account and distributions of profit

-

-

-

Balance at 30 June 2022

30

-

30

DEBT

TOTAL

Loans and other debts due to

MEMBERS'

members less any amounts due

INTERESTS

from members in debtors

Other

amounts

Total

£

£

Amount due to members

4,955,989

Amount due from members

-

Balance at 1 July 2021

4,955,989

4,956,019

Profit for the financial year available for discretionary division among members

-

3,252,590

Members' interests after profit for the year

4,955,989

8,208,609

Other divisions of profit

3,252,590

-

Drawings on account and distributions of profit

(5,240,693

)

(5,240,693

)

Amount due to members

2,967,886

Amount due from members

-

Balance at 30 June 2022

2,967,886

2,967,916

1.	STATUTORY INFORMATION

Harlows Kidderminster LLP is registered in England and Wales. The LLP's registered number and registered office address can be found on the General Information page.

The presentation currency of the financial statements is the Pound Sterling (£).

The principal place of business is at Hoobrook Industrial Estate, Worcester Road, Kidderminster, DY10 1HY.

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 requirements of the Statement of Recommended Practice, Accounting by Limited Liability Partnerships. The financial statements have been prepared under the historical cost convention.

The preparation of financial statements requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the company accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements, are disclosed in the notes below.

These policies have been consistently applied to all the years presented, unless otherwise stated

Financial Reporting Standard 102 - reduced disclosure exemptions

The LLP has taken advantage of the following disclosure exemptions 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;

•

the requirement of paragraph 33.7.

The entity is a subsidiary of Harlow Timber Group Limited, and subsequently a qualifying entity under FRS102 and has such applied the qualifying exemptions given above under FRS102 in respect of those disclosures.

The entity has taken advantage of the exemption, under paragraph 1.12(b) of FRS 102, from preparing a statement of cash flows, on the basis that it is a qualifying entity and its ultimate parent company, Harlow Timber Group Limited, includes the entity’s cash flows in its consolidated financial statements.

The consolidated financial statements of Harlow Timber Group Limited, within which the LLP is included, can be obtained from the Companies House.

Significant judgements and estimates

In the application of the LLP's accounting policies, which are described in the accounting policies below, management is required to make judgements, estimates and assumptions about the carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and underlying assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

Judgements

In preparing these financial statements, the directors have made the following key judgements that have a significant effect on the amounts recognised in the financial statements as described below.

- Determine whether there are indicators of impairment of the LLP's tangible and intangible assets along with residual values and asset lives. The residual value is the net realisable value of an asset at the end of its useful economic life. The entity has made an assessment of the residual values that are appropriate for the business and reviews this assessment annually. Note 6 provides details of the value of fixed assets capitalised.

Estimates and assumptions

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are described below. The LLP based its assumptions and estimates on parameters available when the financial statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising that are beyond the control of the entity. Such changes are reflected in the assumptions when they occur.

a) Establishing useful economic lives for depreciation purposes of property, plant and equipment

Long-lived assets, consisting primarily of property, plant and equipment, comprise a significant portion of the

total assets. The annual depreciation charge depends primarily on the estimated useful economic lives of each type of asset and estimates of residual values. The directors regularly review these asset useful economic lives and change them as necessary to reflect current thinking on remaining lives in light of prospective economic utilisation and physical condition of the assets concerned. Changes in asset useful lives can have a significant impact on depreciation and amortisation charges for the period. Detail of the useful economic lives is included in the tangible fixed asset accounting policy.

b) Providing for bad and doubtful debts

The entity makes an estimate of the recoverable value of trade and other debtors. The entity uses estimates based on historical experience in determining the level of debts, which they believe, will not be collected. These estimates include such factors as the current credit rating of the debtor, the ageing profile of debtors and historical experience. Any significant reduction in the level of customers that default on payments or other significant improvements that resulted in a reduction in the level of bad debt provision would have a positive impact on the operating results. The level of provision required is reviewed on an on-going basis.

c) Stock provisioning

At each reporting date judgement is used by management to establish the net realisable value of stock. Provisions are established for net realisable value where appropriate and are made are based on facts available at the time. The level of provision required is reviewed on an on-going basis.

In arriving at an estimate for the net realisable value of stock, judgement is required in assessing their likely

value on realisation taking into account market and technological changes associated with the demand for the product line.

Revenue recognition

Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

Turnover represents the amounts (excluding value added tax) derived from the provision of goods and services to customers during the year.

Revenue is recognised when the significant risks and rewards of the goods or services provided have transferred to the buyer, the amount of revenue can be measured reliably and it is probable that the economic benefits associated with the transaction will flow to the company.

Revenue is measured at the fair value of the consideration receivable from the sale of goods and services to third parties after deducting discounts and other promotional activities. Revenue may include duties which the company pays as principal, but excludes amounts collected on behalf of other parties, such as value added tax or other sales taxes.

Revenue of the company comprises the following key streams:

Sale of goods

Sales of goods are recognised on sale to the customer, which is considered the point of delivery. Delivery occurs when the goods have been shipped to the location specified by the customer, the risks of obsolescence or loss have been transferred to the customer, the customer has accepted the products in accordance with the sales contract, the acceptance provisions have lapsed or the company has objective evidence that all criteria for acceptance have been satisfied.

Retail sales are usually by cash, credit or payment card. Provision is made for credit notes based on the expected level of returns which is based on the historical experience taking into consideration the type of customer, the type of transaction and the specifics of each arrangement.

Tangible fixed assets

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

Freehold property

-

in accordance with the property

Plant and machinery

-

15% on cost

Fixtures and fittings

-

10% on cost

Motor vehicles

-

25% on cost

Computer equipment

-

20% on cost

Tangible assets are stated at cost less accumulated depreciation and accumulated impairment losses. Cost includes the original purchase price, costs directly attributable to bringing the asset to its working condition for its intended use.

The assets' residual values and useful lives are reviewed, and adjusted, if appropriate, at the end of each reporting period. The effect of any change is accounted for prospectively.

Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to

complete and sell, and after making due allowance for obsolete and slow moving items.

The cost of stock is calculated on the weighted average cost principle on a first in first out basis and includes expenditure incurred in acquiring stock, production or conversion costs, and other costs incurred in bringing them to their existing location and condition. Stocks are recognised as an expense in the period in which the related revenue is recognised.

At each reporting date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price, in the ordinary course of business, less costs to complete and sell. The impairment provision is determined primarily by future demand forecasts. The write down is measured as the difference between the calculated cost of the stock and market based upon assumptions about future demand and charged to the provision for stock, which is a component of cost of sales.

Financial instruments

The LLP only enters into basic financial instruments transactions that result in the recognition of financial assets and liabilities like trade and other accounts receivable and payable and loans to/from related parties.

Debt instruments, like loans and other accounts receivable and payable, are initially measured at present value of the future payments and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade payables or receivables, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration, expected to be paid or received.

However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or financed at a rate of interest that is not a market rate or in case of an outright short-term loan not at market rate, the financial asset or liability is measured, initially and subsequently, at the present value of the future payment discounted at a market rate of interest for a similar debt instrument.

Trade and other debtors

Trade and other debtors are initially recognised at the transaction price and thereafter stated at amortised cost using the effective interest method, less impairment losses for bad and doubtful debts except where the effect of discounting would be immaterial. In such cases, the debtors are stated at cost less impairment losses for bad and doubtful debts.

A provision for impairment of trade debtors is established when there is objective evidence that the LLP will not be able to collect all amounts due according to the original terms of debtors. The amount of the provision is determined as the difference between the asset's carrying amount and the present value of estimated future cash flows, and is recognised in the profit & loss in operating expenses.

Trade and other creditors

Trade and other creditors are initially recognised at fair value and thereafter stated at amortised cost using the effective interest method unless the effect of discounting would be immaterial, in which case they are stated at cost.

Pension costs and other post-retirement benefits

The entity operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the entity pays fixed contributions into a separate entity. Once the contributions have been paid the LLP has no further payment obligations. The contributions are recognised as an expense when they are due. Amounts not paid are shown in other creditors in the balance sheet. The assets of the plan are held separately from the LLP in independently administered funds.

Members

Allocation of profits

The allocation of profit is at the discretion of the Board in accordance with the formal partner remuneration procedures in place. Each partner shares in profit based on the proportion of units allocated to them. The Board, considers factors which, among others, include the split as determined in the partnership agreement and management responsibilities in the determination of the allocation of profits to the individual members.

Profits available for discretionary allocation are classified as equity and included within members’ other reserves.

Amounts due to/(from) members

Current amounts due to and from members are stated at their nominal value, as this approximates to the

amortised cost.

Members are entitled to draw a monthly amount against their expected share of the profit during the course of the year. The partners agree the level of members' monthly drawings. The final allocation of profits and distribution to members is made after assessing each member's contribution for the year and once the annual financial statements are approved. Unallocated profits are included in reserves within members' other reserves in equity.

Where a member's drawings exceed the actual profit allocation during the year, the net amount due from the member is included under current assets in amounts due from members. If the profit allocation exceeds the members drawing, the net amount is included under current liabilities within amounts due to members. This number is determined on a member-by-member basis. The amounts due to or from members that retired during the current year are classified on the same basis.

Going concern

Having completed their assessment, the directors have concluded that there are no material uncertainties that cast significant doubt about the ability of the entity to continue as a going concern.

The entity meets its day-to-day working capital requirements through its banking facilities. The entity's forecasts and projections, taking account of reasonably possible changes in trading performance, show that the entity should be able to continue operate within the level of its current facilities.

The entity's business activities, together with the factors likely to affect its future development and financial position have been considered by the members. The entity currently has sufficient financial resources together with strong relationships spread over a number of customers to enable future growth to continue.

After making enquiries, the members have a reasonable expectation that the entity has adequate resources to continue in operational existence for the foreseeable future. The entity therefore continues to adopt the going concern basis in preparing its financial statements.

3.	EMPLOYEE INFORMATION

30.6.23

30.6.22

£

£

Wages and salaries

1,455,664

1,423,766

Other pension costs

33,460

37,757

1,489,124

1,461,523

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

30.6.23

30.6.22

Partners

2

3

Management & admin

14

14

Production

31

34

47

51

4.	OPERATING PROFIT

The operating profit is stated after charging:

30.6.23

30.6.22

£

£

Depreciation - owned assets

61,390

61,974

Auditors' remuneration

11,933

11,125

5.

INTEREST PAYABLE AND SIMILAR EXPENSES

30.6.23

30.6.22

£

£

Loan

78,661

-

6.	INFORMATION IN RELATION TO MEMBERS

30.6.23

30.6.22

£

£

The amount of profit attributable to the member with the largest entitlement was

648,917

1,082,807

30.6.23

30.6.22

The average number of members during the year was

3

4

7.	TANGIBLE FIXED ASSETS

Fixtures

Freehold

Plant and

and

property

machinery

fittings

£

£

£

COST

At 1 July 2022

354,612

608,873

126,268

Additions

-

3,850

12,238

At 30 June 2023

354,612

612,723

138,506

DEPRECIATION

At 1 July 2022

116,504

547,020

93,190

Charge for year

14,905

24,427

8,209

At 30 June 2023

131,409

571,447

101,399

NET BOOK VALUE

At 30 June 2023

223,203

41,276

37,107

At 30 June 2022

238,108

61,853

33,078

Motor

Computer

vehicles

equipment

Totals

£

£

£

COST

At 1 July 2022

41,800

52,725

1,184,278

Additions

5,450

719

22,257

At 30 June 2023

47,250

53,444

1,206,535

DEPRECIATION

At 1 July 2022

24,946

43,259

824,919

Charge for year

9,982

3,867

61,390

At 30 June 2023

34,928

47,126

886,309

NET BOOK VALUE

At 30 June 2023

12,322

6,318

320,226

At 30 June 2022

16,854

9,466

359,359

8.

STOCKS

30.6.23

30.6.22

£

£

Raw materials

1,740,781

2,060,437

Finished goods

142,821

153,371

1,883,602

2,213,808

There is no material difference between the replacement cost of stocks and the amounts stated above.