Company Registration No. 00900348 (England and Wales)
GRIFFIN & BRAND (EUROPEAN) LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2021
GRIFFIN & BRAND (EUROPEAN) LIMITED
COMPANY INFORMATION
Directors
Mr A J Elliott
Mrs J Elliott
Mr M A Elliott
Mr M C Surgeon
Mrs M K West
Secretary
D Elliott
Company number
00900348
Registered office
Trophy House
Leacon Road
Ashford
Kent
United Kingdom
TN23 4TU
Auditor
Azets Audit Services
5th Floor
Ashford Commercial Quarter
1 Dover Place
Ashford
Kent
United Kingdom
TN23 1FB
Business address
Trophy House
Leacon Road
Ashford
Kent
United Kingdom
TN23 4TU
Bankers
HSBC Bank plc
39 High Street
Ashford
Kent
United Kingdom
TN24 8TG
GRIFFIN & BRAND (EUROPEAN) LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2
Directors' responsibilities statement
3
Independent auditor's report
4 - 7
Statement of comprehensive income
8
Balance sheet
9
Statement of changes in equity
10
Statement of cash flows
11
Notes to the financial statements
12 - 24
GRIFFIN & BRAND (EUROPEAN) LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 30 JUNE 2021
- 1 -
The directors present the strategic report for the year ended 30 June 2021.
Fair review of the business
The results for the year reflected the trading activities and directors' expectations.
Principal risks and uncertainties
Business risks
The management of the business and the execution of the company's strategy are subject to a number of risks. The key business risks affecting the company are:
Foreign currency risk
The company's principal foreign currency exposures arise from trading with overseas companies
, primarily relating to the importing of produce. This particular risk has been intensified by the ongoing Brexit negotiations, which have resulted in a continuing uncertainty around the exchange rate movements. Foreign exchange risks are managed through the use of forward contracts and trade options in line with procurement requirements.
Credit risk
All customers who wish to trade on credit terms are subject to credit verification procedures. Trade debtors are reviewed on a regular basis and provision is made for doubtful debts where necessary.
Liquidity risk
The company considers its liquidity risk to be minimal. The company manages its cash requirements adequately to ensure that the company has sufficient liquid resources to meet the operating needs of the business.
R
isk
arising from Brexit
The company continues to monitor the situation concerning Brexit in order to ensure its policies, procedures and activities mitigate against any of the risks that arise from the company's import business. These risks include cost increases due to import costs, tariffs and duties, the fluctuation of the currencies in which the company trades and the changing dynamics of the available workforce.
Development and performance
The company continues to monitor the ever changing market place while working closely with its customers and suppliers in order to maintain an appropriate sales mix. The financial position remains strong and in line with the directors expectations despite the ever increasing pressures within the market. Net current assets have increased from £6.6m as at 30 June 2020 to £7.0m as at 30 June 2021. Similarly, net assets have increased from £7.6m as at 30 June 2020 to £11.0m as at 30 June 2021, including the revaluation of freehold property. The company will continue to endeavour to adapt in the current uncertain trading environment.
Key performance indicators
We consider the key performance indicators of the company to be turnover, volume, gross margin and net current assets. Turnover for the year increased by 20% to £55.5m (2020 - £46.1m) although the gross profit margin decreased from 6.4% to 5.6%. Net current assets increased to £7.0m (2020 - £6.6m).
Mr M A Elliott
Director
23 December 2021
GRIFFIN & BRAND (EUROPEAN) LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2021
- 2 -
The directors present their annual report and financial statements for the year ended 30 June 2021.
Principal activities
The principal activity of the company during the financial year was to buy and sell produce on its own account
, and to provide services in relation to storing, packing and transport
.
Results and dividends
The results for the year are set out on page 8.
No dividends were paid. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Mr A J Elliott
Mrs J Elliott
Mr M A Elliott
Mr M C Surgeon
Mrs M K West
Auditor
In accordance with the company's articles, a resolution proposing that Azets Audit Services be reappointed as auditor of the company will be put at a General Meeting.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s
auditor
is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s
auditor
is aware of that information.
On behalf of the board
Mr M A Elliott
Director
23 December 2021
GRIFFIN & BRAND (EUROPEAN) LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 30 JUNE 2021
- 3 -
The directors are responsible for preparing the annual 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 United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
-
select suitable accounting policies and then apply them consistently;
-
make judgements and accounting estimates that are reasonable and prudent;
-
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
GRIFFIN & BRAND (EUROPEAN) LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF GRIFFIN & BRAND (EUROPEAN) LIMITED
- 4 -
Opinion
We have audited the financial statements of Griffin & Brand (European) Limited (the 'company') for the year ended 30 June 2021 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including significant accounting policies.
The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102
The Financial Reporting Standard applicable in the UK and Republic of Ireland
(United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
-
give a true and fair view of the state of the company's affairs as at 30 June 2021 and of its profit for the year then ended;
-
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
-
have been prepared in accordance with the requirements of the Companies Act 2006.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the
Auditor's
responsibilities for the audit of the
financial statements
section of our report. We are independent of the
company
in accordance with the ethical requirements that are relevant to our audit of the
financial statements
in the UK, including the FRC’s Ethical Standard
, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the 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.
The other information comprises the information included in the annual report other than the financial statements and our auditor's 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.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit
true
:
-
• the information given in the strategic report and the directors'
r
eport 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.
GRIFFIN & BRAND (EUROPEAN) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF GRIFFIN & BRAND (EUROPEAN) LIMITED
- 5 -
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 identifie
d
material misstatements in the strategic report and the directors'
r
eport
.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
-
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
-
the financial statements are not in agreement with the accounting records and returns; or
-
certain disclosures of
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'
r
esponsibilities
s
tatement, 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.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the
financial statements
as a whole are free from material misstatement, whether due to fraud or error, and to issue an
auditor's
report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with
ISAs (UK)
will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these
financial statements
.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
GRIFFIN & BRAND (EUROPEAN) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF GRIFFIN & BRAND (EUROPEAN) LIMITED
- 6 -
Extent to which the audit was considered capable of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above and on the Financial Reporting Council’s website, to detect material misstatements in respect of irregularities, including fraud.
We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework. Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.
In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included:
-
Enquiry of management and those charged with governance around actual and potential litigation and claims as well as actual, suspected and alleged fraud;
-
Reviewing minutes of meetings of those charged with governance;
-
Assessing the extent of compliance with the laws and regulations considered to have a direct material effect on the financial statements or the operations of the company through enquiry and inspection;
-
Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations;
-
Performing audit work over the risk of management bias and override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for indicators of potential bias.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
GRIFFIN & BRAND (EUROPEAN) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF GRIFFIN & BRAND (EUROPEAN) LIMITED
- 7 -
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 auditor's 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.
Robert Reynolds (Senior Statutory Auditor)
For and on behalf of Azets Audit Services
23 December 2021
Chartered Accountants
Statutory Auditor
5th Floor
Ashford Commercial Quarter
1 Dover Place
Ashford
Kent
United Kingdom
TN23 1FB
GRIFFIN & BRAND (EUROPEAN) LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2021
- 8 -
2021
2020
Notes
£
£
Turnover
3
55,494,583
46,069,765
Cost of sales
(52,396,184)
(43,125,681)
Gross profit
3,098,399
2,944,084
Administrative expenses
(1,553,456)
(1,730,027)
Operating profit
4
1,544,943
1,214,057
Interest receivable and similar income
7
9,523
Interest payable and similar expenses
8
(6,561)
Profit before taxation
1,538,382
1,223,580
Tax on profit
9
(343,789)
(238,484)
Profit for the financial year
1,194,593
985,096
Other comprehensive income
Revaluation of tangible fixed assets
2,579,097
Tax relating to other comprehensive income
(408,210)
Total comprehensive income for the year
3,365,480
985,096
The profit and loss account has been prepared on the basis that all operations are continuing operations.
GRIFFIN & BRAND (EUROPEAN) LIMITED
BALANCE SHEET
AS AT 30 JUNE 2021
30 June 2021
- 9 -
2021
2020
Notes
£
£
£
£
Fixed assets
Tangible assets
10
4,775,368
945,535
Current assets
Stocks
11
587,694
903,279
Debtors
12
11,250,793
10,126,493
Cash at bank and in hand
1,996,722
1,448,709
13,835,209
12,478,481
Creditors: amounts falling due within one year
13
(6,824,787)
(5,833,285)
Net current assets
7,010,422
6,645,196
Total assets less current liabilities
11,785,790
7,590,731
Creditors: amounts falling due after more than one year
14
(208,651)
Provisions for liabilities
Deferred tax liability
16
620,928
(620,928)
-
Net assets
10,956,211
7,590,731
Capital and reserves
Called up share capital
18
690,000
690,000
Revaluation reserve
2,170,887
Profit and loss reserves
8,095,324
6,900,731
Total equity
10,956,211
7,590,731
The financial statements were approved by the board of directors and authorised for issue on 23 December 2021 and are signed on its behalf by:
Mr M A Elliott
Director
Company Registration No. 00900348
GRIFFIN & BRAND (EUROPEAN) LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2021
- 10 -
Share capital
Revaluation reserve
Profit and loss reserves
Total
£
£
£
£
Balance at 1 July 2019
690,000
5,915,635
6,605,635
Year ended 30 June 2020:
Profit and total comprehensive income for the year
-
-
985,096
985,096
Balance at 30 June 2020
690,000
6,900,731
7,590,731
Year ended 30 June 2021:
Profit for the year
-
-
1,194,593
1,194,593
Other comprehensive income:
Revaluation of tangible fixed assets
-
2,579,097
-
2,579,097
Tax relating to other comprehensive income
-
(408,210)
(408,210)
Total comprehensive income for the year
2,170,887
1,194,593
3,365,480
Balance at 30 June 2021
690,000
2,170,887
8,095,324
10,956,211
GRIFFIN & BRAND (EUROPEAN) LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2021
- 11 -
2021
2020
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
23
1,661,818
11,450
Interest paid
(6,561)
Income taxes paid
(348,977)
Net cash inflow from operating activities
1,306,280
11,450
Investing activities
Purchase of tangible fixed assets
(1,270,075)
(72,131)
Proceeds on disposal of tangible fixed assets
3,758
2,500
Interest received
9,523
Net cash used in investing activities
(1,266,317)
(60,108)
Financing activities
Proceeds of new bank loans
700,000
Repayment of bank loans
(175,000)
Payment of finance leases obligations
(16,950)
(48,620)
Net cash generated from/(used in) financing activities
508,050
(48,620)
Net increase/(decrease) in cash and cash equivalents
548,013
(97,278)
Cash and cash equivalents at beginning of year
1,448,709
1,545,987
Cash and cash equivalents at end of year
1,996,722
1,448,709
GRIFFIN & BRAND (EUROPEAN) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2021
- 12 -
1
Accounting policies
Company information
Griffin & Brand (European) Limited is a
private
company
limited by shares
incorporated in
England and Wales
.
The registered office is
Trophy House
,
Leacon Road
,
Ashford
, Kent, United Kingdom,
TN23 4TU
.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in
sterling
, which is the functional currency of the company.
Monetary a
mounts
in these financial statements are
rounded to the nearest £.
The financial statements have been prepared under the historical cost convention, modified to include the revaluation of freehold properties. The principal accounting policies adopted are set out below.
1.2
Going concern
A
true
t the time of approving the financial statements
,
t
he directors have a reasonable expectation that the
company
has adequate resources to continue in operational existence for the foreseeable future. Thus
t
he directors continue to adopt the going concern basis of accounting in preparing the financial statements.
The directors have reviewed the impact of the continuing Covid-19 pandemic on the business. The impact has been negligible to date and the directors consider that this will continue to be the case for the foreseeable future.
1.3
Turnover
Turnover represents amounts receivable for goods net of VAT and trade discounts.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer
(usually on dispatch of the goods)
, the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
1.4
Tangible fixed assets
Tangible fixed assets
are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Land and buildings freehold
2% Straight line
Plant and machinery
25% Straight line
Fixtures, fittings & equipment
15% Straight line
Motor vehicles
25% Straight line
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and
is credited or charged to profit or loss
.
GRIFFIN & BRAND (EUROPEAN) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2021
1
Accounting policies
(Continued)
- 13 -
1.5
Impairment of fixed assets
At each reporting
period
end date, the
company
reviews the carrying amounts of its tangible
assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the
company
estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in
profit
or
loss
, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
1.6
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.
Stocks held for distribution at no or nominal consideration are measured at the lower of replacement cost and cost
.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
1.7
Cash and cash equivalents
Cash and cash equivalents
are basic financial assets
and
include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.8
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset
, with
the net amounts presented in the financial statements
,
when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include
debtors
and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest
method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.
Financial assets classified as receivable within one year are not amortised.
GRIFFIN & BRAND (EUROPEAN) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2021
1
Accounting policies
(Continued)
- 14 -
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in
profit
or
loss
, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
Impairment of financial assets
Financial assets, other than those
held
at
fair value through profit and loss
, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected.
If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when
the company
transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including
creditors
, bank loans, loans from
fellow group companies and preference shares that are classified as debt, are
initially recognised at transaction price unless the arrangement constitutes a
financing transaction, where the debt instrument is measured at the present value of
the future
paymen
ts discounted at a market rate of interest.
Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective
interest rate method.
Trade creditors
are obligations to pay for goods or services that have been acquired
in the ordinary course of business from suppliers. A
m
ounts payable are classified as
current liabilities if payment is due within one year or less. If not, they are presented
as non-current liabilities.
Trade creditors
are recognised initially at transaction price
and subsequently measured at amortised cost using the effective interest method.
GRIFFIN & BRAND (EUROPEAN) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2021
1
Accounting policies
(Continued)
- 15 -
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts,
are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are
s
ubsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in
profit
or
loss
in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as
being measured at
fair value th
r
ough profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations
expire or are discharged or cancelled.
1.9
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs.
Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.10
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the
profit and loss account
because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The
company’s
liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax is provided in full in respect of taxation deferred by timing differences between the treatment of certain items for taxation and accounting purposes. The deferred tax balance has not been discounted.
1.11
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or
fixed assets
.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.12
Retirement benefits
The pension costs charged in the financial statements represent the contributions payable by the company during the year
.
GRIFFIN & BRAND (EUROPEAN) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2021
1
Accounting policies
(Continued)
- 16 -
1.13
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the asset
'
s fair
value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to the profit and loss account so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Rentals payable under operating leases,
including
any lease incentives received, are charged to
profit or loss
on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the lease
s
asset are consumed.
1.14
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation
in the period
are included in profit or loss.
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated 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 where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
3
Turnover and other revenue
An analysis of the company's turnover is as follows:
2021
2020
£
£
Turnover analysed by class of business
Sale of produce
55,494,583
46,069,765
2021
2020
£
£
Other significant revenue
Interest income
-
9,523
GRIFFIN & BRAND (EUROPEAN) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2021
3
Turnover and other revenue
(Continued)
- 17 -
2021
2020
£
£
Turnover analysed by geographical market
United Kingdom
55,494,583
46,069,765
4
Operating profit
2021
2020
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange differences apart from those arising on financial instruments measured at fair value through profit or loss
(240,333)
(193,351)
Fees payable to the company's auditor for the audit of the company's financial statements
21,212
22,000
Depreciation of owned tangible fixed assets
105,262
185,394
Depreciation of tangible fixed assets held under finance leases
11,771
(Profit)/loss on disposal of tangible fixed assets
610
Operating lease charges
2,865
8,295
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2021
2020
Number
Number
Production
125
98
Administration
17
18
Directors
5
5
Total
147
121
Their aggregate remuneration comprised:
2021
2020
£
£
Wages and salaries
3,723,389
3,330,063
Social security costs
427,994
397,964
Pension costs
271,633
227,029
4,423,016
3,955,056
GRIFFIN & BRAND (EUROPEAN) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2021
- 18 -
6
Directors' remuneration
2021
2020
£
£
Remuneration for qualifying services
842,318
878,495
Company pension contributions to defined contribution schemes
32,205
10,659
874,523
889,154
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 2 (2020 - 4
).
Remuneration disclosed above include the following amounts paid to the highest paid director:
2021
2020
£
£
Remuneration for qualifying services
455,857
661,022
7
Interest receivable and similar income
2021
2020
£
£
Interest income
Interest on bank deposits
9,523
Investment income includes the following:
Interest on financial assets not measured at fair value through profit or loss
9,523
8
Interest payable and similar expenses
2021
2020
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
4,557
Other finance costs:
Interest on finance leases and hire purchase contracts
489
Other interest
1,515
6,561
9
Taxation
2021
2020
£
£
Current tax
UK corporation tax on profits for the current period
101,842
246,082
GRIFFIN & BRAND (EUROPEAN) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2021
9
Taxation
2021
2020
£
£
(Continued)
- 19 -
Deferred tax
Origination and reversal of timing differences
241,947
(7,598)
Total tax charge
343,789
238,484
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2021
2020
£
£
Profit before taxation
1,538,382
1,223,580
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2020: 19.00%)
292,293
232,480
Tax effect of expenses that are not deductible in determining taxable profit
80
2,510
Effect of change in corporation tax rate
51,416
Permanent capital allowances in excess of depreciation
3,494
Taxation charge for the year
343,789
238,484
In addition to the amount charged to the profit and loss account, the following amounts relating to tax have been recognised directly in other comprehensive income:
2021
2020
£
£
Deferred tax arising on:
Revaluation of property
408,210
-
GRIFFIN & BRAND (EUROPEAN) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2021
- 20 -
10
Tangible fixed assets
Land and buildings freehold
Plant and machinery
Fixtures, fittings & equipment
Motor vehicles
Total
£
£
£
£
£
Cost or valuation
At 1 July 2020
1,247,716
2,186,208
446,413
326,671
4,207,008
Additions
951,080
414,874
5,573
1,371,527
Disposals
(3,558)
(200)
(3,758)
Revaluation
2,579,097
2,579,097
At 30 June 2021
4,777,893
2,597,524
451,986
326,471
8,153,874
Depreciation and impairment
At 1 July 2020
457,688
2,101,907
385,914
315,964
3,261,473
Depreciation charged in the year
20,205
82,827
10,255
3,746
117,033
At 30 June 2021
477,893
2,184,734
396,169
319,710
3,378,506
Carrying amount
At 30 June 2021
4,300,000
412,790
55,817
6,761
4,775,368
At 30 June 2020
790,028
84,301
60,499
10,707
945,535
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
2021
2020
£
£
Plant and machinery
101,231
Freehold land and buildings were revalued on 4 November 2021 at £4,300,000 by independent valuers not connected with the company, on the basis of market value. The directors consider the value to be relevant at 30 June 2021. The valuation conforms to International Valuation Standards and was based on recent market transactions on arm's length terms for similar properties.
true
If freehold land and buildings were measured using the cost model, the carrying amounts would have been approximately £1,720,903 (2020: £790,028), being cost £2,198,796 (2020: £1,247,716) and depreciation £477,893 (2020: £457,688).
11
Stocks
2021
2020
£
£
Consumables
233,301
136,801
Finished goods and goods for resale
354,393
766,478
587,694
903,279
GRIFFIN & BRAND (EUROPEAN) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2021
- 21 -
12
Debtors
2021
2020
Amounts falling due within one year:
£
£
Trade debtors
10,156,386
9,357,846
Other debtors
587,087
432,579
Prepayments and accrued income
507,320
306,839
11,250,793
10,097,264
Deferred tax asset (note 16)
29,229
11,250,793
10,126,493
13
Creditors: amounts falling due within one year
2021
2020
Notes
£
£
Bank loans
350,000
Obligations under finance leases
15
50,851
Trade creditors
5,308,400
4,504,071
Corporation tax
101,615
348,750
Other taxation and social security
221,375
207,490
Other creditors
1,052
1,057
Accruals and deferred income
791,494
771,917
6,824,787
5,833,285
14
Creditors: amounts falling due after more than one year
2021
2020
Notes
£
£
Bank loans and overdrafts
175,000
Obligations under finance leases
15
33,651
208,651
15
Finance lease obligations
2021
2020
Future minimum lease payments due under finance leases:
£
£
Within one year
52,318
In two to five years
34,879
87,197
Less: future finance charges
(2,695)
84,502
GRIFFIN & BRAND (EUROPEAN) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2021
15
Finance lease obligations
(Continued)
- 22 -
16
Deferred taxation
Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:
Liabilities
Liabilities
Assets
Assets
2021
2020
2021
2020
Balances:
£
£
£
£
Accelerated / Decelerated capital allowances
214,464
-
-
29,229
Revaluations
408,210
-
-
-
Retirement benefit obligations
(1,746)
-
-
-
620,928
-
-
29,229
2021
Movements in the year:
£
Asset at 1 July 2020
(29,229)
Charge to profit or loss
241,947
Charge to other comprehensive income
408,210
Liability at 30 June 2021
620,928
17
Retirement benefit schemes
2021
2020
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
271,633
227,029
The company
contributes to two
defined contribution pension scheme
s
.
The assets of the schemes are held separately from those of the company in independently administered funds.
The company contributes to a defined contribution pension scheme for employees. The pension cost charge represents contributions payable by the company to the fund and amounted to £239,428 (2020: £216,371).
The company also contributes to a defined contribution pension scheme for directors. The assets of the scheme are held separately from those of the company in an independently administered fund. The pension cost charge represents contributions payable by the company to the fund and amounted to £32,205 (2020: £10,658).
GRIFFIN & BRAND (EUROPEAN) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2021
- 23 -
18
Share capital
2021
2020
2021
2020
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
240,000
240,000
240,000
240,000
B Ordinary shares of £1 each
450,000
450,000
450,000
450,000
690,000
690,000
690,000
690,000
The Ordinary shares carry voting rights, rights to dividends as declared by the directors, and right to a share of the assets on a winding up.
The B Class Ordinary shares carry rights to dividends, but have no voting rights and no rights to a share of the assets on a winding up.
19
Financial commitments, guarantees and contingent liabilities
Griffin and Brand (European) Limited has given a guarantee to H M Revenue and Customs for duty payable on goods imported from outside the United Kingdom. This guarantee amounted to £
6
00,000 (20
20
: £
6
00,000).
20
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2021
2020
£
£
Within one year
95,094
25,612
Between two and five years
147,585
62,828
242,679
88,440
21
Related party transactions
Transactions with related parties
During the year the company entered into the following transactions with related parties:
Other information
Transaction with directors:
The directors operate loan accounts with the company. As at 30 June 2021, Griffin and Brand (European) Limited was owed £540 by A J Elliott (2020: £532) and owed £1,563 to M Elliott (2020: £1,563
. The loans were interest free and repayable upon demand.
22
Ultimate controlling party
The ultimate controlling party of the company is the Elliott family, who between them own the entire share capital currently in issue within the company.
GRIFFIN & BRAND (EUROPEAN) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2021
- 24 -
23
Cash generated from operations
2021
2020
£
£
Profit for the year after tax
1,194,593
985,096
Adjustments for:
Taxation charged
343,789
238,484
Finance costs
6,561
Investment income
(9,523)
(Gain)/loss on disposal of tangible fixed assets
610
Depreciation and impairment of tangible fixed assets
117,033
185,394
Movements in working capital:
Decrease/(increase) in stocks
315,585
(539,405)
Increase in debtors
(1,153,529)
(3,324,623)
Increase in creditors
837,786
2,475,417
Cash generated from operations
1,661,818
11,450
24
Analysis of changes in net funds
1 July 2020
Cash flows
New finance leases
30 June 2021
£
£
£
£
Cash at bank and in hand
1,448,709
548,013
-
1,996,722
Borrowings excluding overdrafts
-
(525,000)
-
(525,000)
Obligations under finance leases
-
16,950
(101,452)
(84,502)
1,448,709
39,963
(101,452)
1,387,220
2021-06-30
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