Registration number:
Pukka Pies Limited
for the Period from 30 May 2017 to 28 May 2018
Robert Whowell & Partners
Chartered Accountants
Westwood House
78 Loughborough Road
Quorn
Loughborough
Leicestershire
LE12 8DX
Pukka Pies Limited
Contents
Company Information |
|
Strategic Report |
|
Directors' Report |
|
Statement of Directors' Responsibilities |
|
Independent Auditor's Report |
|
Profit and Loss Account |
|
Statement of Comprehensive Income |
|
Balance Sheet |
|
Statement of Changes in Equity |
|
Statement of Cash Flows |
|
Notes to the Financial Statements |
Pukka Pies Limited
Company Information
Directors |
A. J. Storer T. D. Storer V. C. Storer |
Company secretary |
A. J. Storer |
Registered office |
|
Auditors |
|
Page 1 |
Pukka Pies Limited
Strategic Report for the Period from 30 May 2017 to 28 May 2018
The directors present their strategic report for the period from 30 May 2017 to 28 May 2018.
Principal activity
The principal activity of the company is pie manufacturing.
Fair review of the business
The directors consider that the company's business has continued to operate satisfactorily and believe that a strong platform is in place to allow for sustained growth within the industry. Their focus continues to be to meet the needs of the customer base by delivering a superior quality product; offering excellent value for money; with best-in industry service levels.
Turnover increased from £45.839m to £49.383m as a result of strategically focusing on the most profitable areas of the business.
In line with our three year strategy we have continued to invest in the brand through advertising spend in the year.
During the year we have seen inflation on raw materials which has impacted our cost base.
At the close of the financial year the company had shareholder funds of £35,506,401, an increase of £1,241,051 over the prior year.
Page 2 |
Pukka Pies Limited
Strategic Report for the Period from 30 May 2017 to 28 May 2018
Principal risks and uncertainties
Food Safety
The directors, management and all employees make food safety their first priority. The company operates from state of the art premises and maintains grade AA accreditation to the BRC Global Standard for Food Safety. This includes the operation of a robust HACCP system across all product lines. The onsite microbiological laboratory is also independently accredited by CLAS.
Environmental
Pukka Pies Limited has for many years emphasised: waste reduction; energy efficiency; minimisation of packaging; recycling and emission control. Significant gains have been made in all areas and each year we pursue further improvement.
Customers
In keeping with Pukka Pies Limited's founding principles, the company remains focused on producing superior products coupled with outstanding customer service whilst offering excellent value for money. The company makes sure it is focused on fulfilling its customer orders unfailingly and remains customer focused. Customers are also supported with comprehensive sales, marketing and category support along with technical information and advice.
Suppliers
Pukka Pies Limited has a strong ethical focus on selecting and dealing with suppliers. Company policy is to settle suppliers' accounts promptly. Pukka Pies Limited buys on quality, service and price.
Approved by the
.........................................
Company secretary
Page 3 |
Pukka Pies Limited
Directors' Report for the Period from 30 May 2017 to 28 May 2018
The directors present their report and the financial statements for the period from 30 May 2017 to 28 May 2018.
Directors of the company
The directors who held office during the period were as follows:
Financial instruments
Objectives and policies
The company's principal financial instruments comprise bank balances, trade debtors and trade creditors. The purpose of these instruments is to finance the company's operations.
Price risk, credit risk, liquidity risk and cash flow risk
In respect of bank balances, the liquidity risk is managed by maintaining a healthy cash balance throughout the year. All of the company's cash balances are held in such a way that achieves a competitive rate of interest.
Trade debtors are managed in respect of credit and cash flow risk by policies concerning the credit offered to customers and the regular monitoring of amounts outstanding for both time and credit limits. The amounts presented in the balance sheet are net of allowances for doubtful debts.
Trade creditors liquidity risk is managed by ensuring sufficient funds are available to meet amounts due.
Employment of disabled persons
Pukka Pies Limited is committed to equality of opportunity in all its employment practices, policies and procedures. This means that no employee, or potential employee, will receive less favourable treatment due to their gender, marital status, race, disability, political or religious beliefs. The company maintains a company policy for ensuring employee involvement in matters of concern to them and providing employees with relevant information.
Environmental matters
Pukka Pies Limited has for many years emphasised: waste reduction; energy efficiency; minimisation of packaging; recycling and emission control. Significant gains have been made in all areas and each year we pursue further improvement.
Page 4 |
Pukka Pies Limited
Directors' Report for the Period from 30 May 2017 to 28 May 2018
Social and community issues
Pukka Pies Limited's charity policy is to support local registered charities operating in the immediate vicinity of the business.
In particular, supporting local young people in sport and outdoor healthy activities are areas of special emphasis.
During the year the company contributed £20,423 to charities.
In addition to monetary donations the company has donated 16,800 pies and pasties through the Fare Share network and 4,680 pies to Open Hands. Fare Share redistribute surplus food from the UK food industry to charities and community groups who otherwise would be buying this food. Open Hands provide assistance to the most vulnerable and disadvantaged in society by providing weekly hot meals to those in need in Leicester.
Future developments
The company has continued to build brand awareness and the directors expect the business to grow over the coming years. This is supported by our investment in advertising during the year and the media campaign for 2018/19.
Disclosure of information to the auditors
Each director has taken steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditors are aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditors are unaware.
Approved by the
.........................................
Company secretary
Page 5 |
Pukka Pies Limited
Statement of Directors' Responsibilities
The directors acknowledge their responsibilities 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 apply them consistently; |
• |
make judgements and accounting estimates that are reasonable and prudent; |
• |
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and |
• |
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.
Page 6 |
Pukka Pies Limited
Independent Auditor's Report to the Members of Pukka Pies Limited
Opinion
We have audited the financial statements of Pukka Pies Limited (the 'company') for the period from 30 May 2017 to 28 May 2018, which comprise the Profit and Loss Account, Statement of Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Statement of Cash Flows 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).
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.
In our opinion the financial statements:
• |
give a true and fair view of the state of the company's affairs as at 28 May 2018 and of its profit for the period 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 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
We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:
• |
the directors’ use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or |
• |
the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the company’s ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue. |
Page 7 |
Pukka Pies Limited
Independent Auditor's Report to the Members of Pukka Pies Limited
Other information
The directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report 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 there is a material misstatement in the financial statements or a material misstatement of the other information. 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 matter 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 Directors' Report for the financial period for which the financial statements are prepared is consistent with the financial statements; and |
• |
the Strategic Report and 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 our 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 and the Directors' Report.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
• |
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or |
• |
the financial statements are not in agreement with the accounting records and returns; or |
• |
certain disclosures of directors’ remuneration specified by law are not made; or |
• |
we have not received all the information and explanations we require for our audit. |
Page 8 |
Pukka Pies Limited
Independent Auditor's Report to the Members of Pukka Pies Limited
Responsibilities of directors
As explained more fully in the Statement of Directors' Responsibilities [set out on page 6], 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.
As part of an audit in accordance with ISAs (UK), we exercise professional judgment and maintain professional scepticism throughout the audit. We also:
• |
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. 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. |
• |
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control. |
• |
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors. |
• |
Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the company to cease to continue as a going concern. |
• |
Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. |
Page 9 |
Pukka Pies Limited
Independent Auditor's Report to the Members of Pukka Pies Limited
• |
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the company to express an opinion on the financial statements. We are responsible for the direction, supervision and performance of the company audit. We remain solely responsible for our audit opinion. |
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
..........................................................................
For and on behalf of:
Westwood House
78 Loughborough Road
Quorn
Leicestershire
LE12 8DX
Page 10 |
Pukka Pies Limited
Profit and Loss Account for the Period from 30 May 2017 to 28 May 2018
Note |
2018 |
2017 |
|
Turnover |
|
|
|
Cost of sales |
( |
( |
|
Gross profit |
|
|
|
Administrative expenses |
( |
( |
|
Other operating income |
|
|
|
Operating profit |
|
|
|
Other interest receivable and similar income |
|
|
|
Interest payable and similar expenses |
( |
( |
|
5,707 |
28,553 |
||
Profit before tax |
|
|
|
Taxation |
( |
( |
|
Profit for the financial period |
|
|
The above results were derived from continuing operations.
The notes on pages 16 to 33 form an integral part of these financial statements.
Page 11 |
Pukka Pies Limited
Statement of Comprehensive Income for the Period from 30 May 2017 to 28 May 2018
Note |
2018 |
2017 |
|
Profit for the period |
|
|
|
Remeasurement gain on defined benefit pension scheme |
|
|
|
Total comprehensive income for the period |
|
|
The notes on pages 16 to 33 form an integral part of these financial statements.
Page 12 |
Pukka Pies Limited
(Registration number: 01008747)
Balance Sheet as at 28 May 2018
Note |
2018 |
2017 |
|
Fixed assets |
|||
Tangible assets |
|
|
|
Current assets |
|||
Stocks |
|
|
|
Debtors |
|
|
|
Cash at bank and in hand |
|
|
|
|
|
||
Creditors: Amounts falling due within one year |
( |
( |
|
Net current assets |
|
|
|
Total assets less current liabilities |
|
|
|
Provisions for liabilities |
( |
( |
|
Net assets excluding pension liability |
35,292,401 |
34,966,350 |
|
Net pension asset/(liability) |
214,000 |
(701,000) |
|
Net assets |
|
|
|
Capital and reserves |
|||
Called up share capital |
|
|
|
Revaluation reserve |
|
|
|
Profit and loss account |
|
|
|
Total equity |
|
|
Approved and authorised by the
.........................................
Director
The notes on pages 16 to 33 form an integral part of these financial statements.
Page 13 |
Pukka Pies Limited
Statement of Changes in Equity for the Period from 30 May 2017 to 28 May 2018
Share capital |
Revaluation reserve |
Profit and loss account |
Total |
|
At 30 May 2017 |
|
|
|
|
Profit for the period |
- |
- |
|
|
Other comprehensive income |
- |
( |
|
|
Total comprehensive income |
- |
( |
|
|
Dividends |
- |
- |
( |
( |
At 28 May 2018 |
|
|
|
|
Share capital |
Revaluation reserve |
Profit and loss account |
Total |
|
At 31 May 2016 |
|
|
|
|
Profit for the period |
- |
- |
|
|
Other comprehensive income |
- |
( |
|
|
Total comprehensive income |
- |
( |
|
|
Dividends |
- |
- |
( |
( |
At 29 May 2017 |
|
|
|
|
The notes on pages 16 to 33 form an integral part of these financial statements.
Page 14 |
Pukka Pies Limited
Statement of Cash Flows for the Period from 30 May 2017 to 28 May 2018
Note |
2018 |
2017 |
|
Cash flows from operating activities |
|||
Profit for the period |
|
|
|
Adjustments to cash flows from non-cash items |
|||
Depreciation and amortisation |
|
|
|
Financial instrument net losses through profit and loss |
|
|
|
(Profit)/loss on disposal of tangible assets |
( |
|
|
Finance income |
( |
( |
|
Finance costs |
|
|
|
Income tax expense |
|
|
|
|
|
||
Working capital adjustments |
|||
Increase in stocks |
( |
( |
|
Decrease/(increase) in trade debtors |
|
( |
|
Increase in trade creditors |
|
|
|
Increase in retirement benefit obligation net of actuarial changes |
|
|
|
Cash generated from operations |
|
|
|
Income taxes paid |
( |
( |
|
Net cash flow from operating activities |
|
|
|
Cash flows from investing activities |
|||
Interest received |
|
|
|
Acquisitions of tangible assets |
( |
( |
|
Proceeds from sale of tangible assets |
|
|
|
Net cash flows from investing activities |
( |
( |
|
Cash flows from financing activities |
|||
Interest paid |
( |
( |
|
Dividends paid |
( |
( |
|
Net cash flows from financing activities |
( |
( |
|
Net increase/(decrease) in cash and cash equivalents |
|
( |
|
Cash and cash equivalents at 30 May 2017 |
|
|
|
Cash and cash equivalents at 28 May 2018 |
10,433,244 |
8,853,090 |
The notes on pages 16 to 33 form an integral part of these financial statements.
Page 15 |
Pukka Pies Limited
Notes to the Financial Statements for the Period from 30 May 2017 to 28 May 2018
General information |
The company is a private company limited by share capital, incorporated in England and Wales.
The address of its registered office is:
These financial statements were authorised for issue by the
Accounting policies |
Summary of significant accounting policies and key accounting estimates
The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.
Statement of compliance
These financial statements were prepared in accordance with Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'.
Basis of preparation
These financial statements have been prepared using the historical cost convention except that, as disclosed in the accounting policies, certain items are shown at fair value.
Page 16 |
Pukka Pies Limited
Notes to the Financial Statements for the Period from 30 May 2017 to 28 May 2018
Judgements
Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. |
The company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below. |
(i) Useful economic lives of tangible fixed assets. The annual depreciation charge for tangible fixed assets is sensitive to changes in the estimated useful economic lives and residual values of the assets. The useful economic lives and residual values are re-assessed annually. They are amended when necessary to reflect current estimates, based on technological advancement, future investments, economic utilisation and the physical condition of the assets. See note 12 for the carrying amount of the tangible fixed assets, and see the policy below for the useful economic lives of each class of asset. |
(ii) Defined benefit pension scheme. The company has an obligation to pay pension benefits to certain employees. The cost of these benefits and the present value of the obligation depend on a number of factors, including; life expectancy, salary increases, asset valuations and the discount rate on corporate bonds. Management estimate these factors in determining the net pension obligation in the balance sheet. The assumptions reflect historical experience and current trends. See note 18 for the disclosures relating to the defined benefit pension scheme. |
Revenue recognition
Turnover comprises the fair value of the consideration received or receivable for the sale of goods and provision of services in the ordinary course of the company’s activities. Turnover is shown net of value added tax, returns, rebates and discounts.
The company recognises revenue when: the amount of revenue can be reliably measured; it is probable that future economic benefits will flow to the entity; and specific criteria have been met for each of the company's activities.
Tax
The tax expense for the period comprises current and deferred tax. Tax is recognised in profit or loss, except that a change attributable to an item of income or expense recognised as other comprehensive income is recognised directly in other comprehensive income.
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 taxable income.
Page 17 |
Pukka Pies Limited
Notes to the Financial Statements for the Period from 30 May 2017 to 28 May 2018
Deferred tax is recognised in respect of all timing differences between taxable profits and profits reported in the financial statements.
Unrelieved tax losses and other deferred tax assets are recognised when it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.
Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing difference.
Tangible assets
Tangible assets are stated in the statement of financial position at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.
The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.
Depreciation
Depreciation is charged so as to write off the cost of assets over their estimated useful lives, as follows:
Asset class |
Depreciation method and rate |
Land and buildings |
2% straight line |
Fixtures, fittings and equipment |
15% to 30% reducing balance |
Motor vehicles |
25% reducing balance |
Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.
Trade debtors
Trade debtors are amounts due from customers for merchandise sold or services performed in the ordinary course of business.
Trade debtors are recognised initially at the transaction price. They are subsequently measured at amortised cost using the effective interest method, less provision for impairment. A provision for the impairment of trade debtors is established when there is objective evidence that the company will not be able to collect all amounts due according to the original terms of the debtors.
Page 18 |
Pukka Pies Limited
Notes to the Financial Statements for the Period from 30 May 2017 to 28 May 2018
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost is determined using the first-in, first-out (FIFO) method.
The cost of raw materials and finished goods 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. At each reporting date, stocks are assessed for impairment. If stocks are impaired, the carrying amount is reduced to its selling price less costs to complete and sell; the impairment loss is recognised immediately in profit or loss.
Trade creditors
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the company does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.
Trade creditors are recognised initially at the transaction price and subsequently measured at amortised cost using the effective interest method.
Share capital
Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.
Dividends
Dividend distribution to the company’s shareholders is recognised as a liability in the financial statements in the reporting period in which the dividends are declared.
Defined contribution pension obligation
A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the company has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.
Contributions to defined contribution plans are recognised as an employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.
Page 19 |
Pukka Pies Limited
Notes to the Financial Statements for the Period from 30 May 2017 to 28 May 2018
Defined benefit pension obligation
The company recognises a defined benefit pension asset or liability in the statement of financial position as the net total of the present value of its obligations and the fair value of plan assets out of which the obligations are to be settled. The defined benefit liability is measured on a discounted present value basis using a rate determined by reference to market yields at the reporting date on high quality corporate bonds. Defined benefit obligations and the related expenses are measured using the projected unit credit method. Plan surpluses are recognised as a defined benefit asset only to the extent that the surplus is recoverable either through reduced contributions in the future or through refunds from the plan.
Changes in the defined benefit asset or liability arising from employee service are recognised in comprehensive income as a current service cost where it relates to services in the current period and as a past service cost where it relates to services in prior periods. Costs relating to plan introductions, benefit changes, curtailments and settlements are recognised in comprehensive income in the period in which they occur.
Net interest is determined by multiplying the defined benefit liability by the discount rate, both as determined at the start of the reporting period, taking account of any changes in the defined benefit liability during the period as a result of contribution and benefit payments. Net interest is recognised in comprehensive income.
Revenue |
The analysis of the company's revenue for the period from continuing operations is as follows:
2018 |
2017 |
|
Sale of goods |
|
|
The analysis of the company's turnover for the period by market is as follows:
30 May 2017 to 28 May 2018 |
31 May 2016 to 29 May 2017 |
|
UK |
|
|
Europe |
|
|
Rest of world |
|
|
|
|
Page 20 |
Pukka Pies Limited
Notes to the Financial Statements for the Period from 30 May 2017 to 28 May 2018
Other operating income |
The analysis of the company's other operating income for the period is as follows:
2018 |
2017 |
|
Rental income |
|
|
Benefit from trademark agreement |
- |
|
|
|
Operating profit |
Arrived at after charging/(crediting)
2018 |
2017 |
|
Depreciation expense |
|
|
(Profit)/loss on disposal of property, plant and equipment |
( |
|
Other interest receivable and similar income |
2018 |
2017 |
|
Interest income on bank deposits |
|
|
Interest payable and similar expenses |
2018 |
2017 |
|
Other finance costs |
|
|
Page 21 |
Pukka Pies Limited
Notes to the Financial Statements for the Period from 30 May 2017 to 28 May 2018
Staff costs |
The aggregate payroll costs (including directors' remuneration) were as follows:
2018 |
2017 |
|
Wages and salaries |
|
|
Social security costs |
|
|
Pension costs, defined contribution scheme |
|
|
Pension costs, defined benefit scheme |
|
|
Other post-employment benefit costs |
|
|
|
|
The average number of persons employed by the company (including directors) during the period, analysed by category was as follows:
2018 |
2017 |
|
Staff |
|
|
Directors |
|
|
|
|
Page 22 |
Pukka Pies Limited
Notes to the Financial Statements for the Period from 30 May 2017 to 28 May 2018
Directors' remuneration |
The directors' remuneration for the period was as follows:
2018 |
2017 |
|
Remuneration |
|
|
During the period the number of directors who were receiving benefits and share incentives was as follows:
2018 |
2017 |
|
Accruing benefits under defined benefit pension scheme |
|
|
In respect of the highest paid director:
2018 |
2017 |
|
Remuneration |
|
|
Defined benefit accrued pension entitlement at the end of the period |
|
|
Defined benefit accrued lump sum at the end of the period |
|
|
Auditors' remuneration |
2018 |
2017 |
|
Audit of the financial statements |
|
|
Other fees to auditors |
||
Taxation compliance services |
|
|
All other tax advisory services |
|
|
All other services relating to corporate finance transactions on behalf of the company |
|
|
All other non-audit services |
|
|
|
|
Page 23 |
Pukka Pies Limited
Notes to the Financial Statements for the Period from 30 May 2017 to 28 May 2018
Taxation |
Tax charged/(credited) in the income statement
2018 |
2017 |
|
Current taxation |
||
UK corporation tax |
|
|
UK corporation tax adjustment to prior periods |
- |
|
619,303 |
788,207 |
|
Deferred taxation |
||
Arising from origination and reversal of timing differences |
( |
( |
Tax expense in the income statement |
|
|
The tax on profit before tax for the period is higher than the standard rate of corporation tax in the UK (2017 - higher than the standard rate of corporation tax in the UK) of
The differences are reconciled below:
2018 |
2017 |
|
Profit before tax |
|
|
Corporation tax at standard rate |
|
|
Effect of expense not deductible in determining taxable profit/(tax loss) |
|
( |
Increase/(decrease) in UK and foreign current tax from adjustment for prior periods |
- |
|
Tax increase from effect of capital allowances and depreciation |
|
|
Tax increase from other short-term timing differences |
|
|
Total tax charge |
|
|
Page 24 |
Pukka Pies Limited
Notes to the Financial Statements for the Period from 30 May 2017 to 28 May 2018
Deferred tax
Deferred tax assets and liabilities
2018 |
Liability |
Accelerated capital allowances |
|
Pension benefit obligations |
|
|
2017 |
Asset |
Liability |
Accelerated capital allowances |
- |
|
Pension benefit obligations |
|
- |
|
|
Tax relating to items recognised in other comprehensive income or equity
2018 |
2017 |
|
Deferred tax related to items recognised as items of other comprehensive income |
|
|
Page 25 |
Pukka Pies Limited
Notes to the Financial Statements for the Period from 30 May 2017 to 28 May 2018
Tangible assets |
Land and buildings |
Fixtures, fittings and equipment |
Motor vehicles |
Total |
|
Cost or valuation |
||||
At 30 May 2017 |
|
|
|
|
Additions |
- |
|
|
|
Disposals |
- |
- |
( |
( |
At 28 May 2018 |
|
|
|
|
Depreciation |
||||
At 30 May 2017 |
|
|
|
|
Charge for the period |
|
|
|
|
Eliminated on disposal |
- |
- |
( |
( |
At 28 May 2018 |
|
|
|
|
Carrying amount |
||||
At 28 May 2018 |
|
|
|
|
At 29 May 2017 |
|
|
|
|
Included within the net book value of land and buildings above is £13,640,000 (2017 - £13,900,000) in respect of freehold land and buildings.
Revaluation
The fair value of the company's freehold property was revalued on
Had this class of asset been measured on a historical cost basis the carrying amount would have been £
Page 26 |
Pukka Pies Limited
Notes to the Financial Statements for the Period from 30 May 2017 to 28 May 2018
Stocks |
2018 |
2017 |
|
Raw materials |
|
|
Work in progress |
|
- |
Finished goods |
|
|
|
|
Debtors |
2018 |
2017 |
|
Trade debtors |
|
|
Other debtors |
|
|
Prepayments |
|
|
Income tax asset |
95,188 |
14,492 |
Total current trade and other debtors |
|
|
Cash and cash equivalents |
2018 |
2017 |
|
Cash on hand |
|
|
Cash at bank |
|
|
Short-term deposits |
|
|
|
|
Page 27 |
Pukka Pies Limited
Notes to the Financial Statements for the Period from 30 May 2017 to 28 May 2018
Creditors |
Note |
2018 |
2017 |
|
Due within one year |
|||
Trade creditors |
|
|
|
Social security and other taxes |
|
|
|
Other payables |
|
|
|
Accrued expenses |
|
|
|
|
|
Deferred tax and other provisions |
Deferred tax |
Total |
|
At 30 May 2017 |
|
|
Decrease in existing provisions |
( |
( |
At 28 May 2018 |
|
|
Pension and other schemes |
Defined contribution pension scheme
The company operates a defined contribution pension scheme. The pension cost charge for the period represents contributions payable by the company to the scheme and amounted to £
Defined benefit pension schemes
Pukka Pies Limited operate a defined benefit pension arrangement called the Pukka Pies Limited Pension Scheme. The company currently pays 10% of the pensionable salaries to cover the benefit accrual for active members.
Page 28 |
Pukka Pies Limited
Notes to the Financial Statements for the Period from 30 May 2017 to 28 May 2018
The date of the most recent comprehensive actuarial valuation was
The total cost relating to the defined benefit scheme for the period recognised in profit or loss as an expense was £376,152 (2017 - £385,000 ).
Reconciliation of scheme assets and liabilities to assets and liabilities recognised
The amounts recognised in the statement of financial position are as follows:
2018 |
2017 |
|
Fair value of scheme assets |
|
|
Present value of defined benefit obligation |
( |
( |
Defined benefit pension scheme surplus/(deficit) |
|
( |
Defined benefit obligation
Changes in the defined benefit obligation are as follows:
2018 |
|
Present value at start of period |
|
Current service cost |
|
Interest cost |
|
Actuarial gains and losses |
( |
Benefits paid |
( |
Contributions by scheme participants |
|
Present value at end of period |
|
Page 29 |
Pukka Pies Limited
Notes to the Financial Statements for the Period from 30 May 2017 to 28 May 2018
Fair value of scheme assets
Changes in the fair value of scheme assets are as follows:
2018 |
|
Fair value at start of period |
|
Return on plan assets, excluding amounts included in interest income/(expense) |
|
Actuarial gains and losses |
( |
Employer contributions |
|
Contributions by scheme participants |
|
Benefits paid |
( |
Fair value at end of period |
|
Analysis of assets
The major categories of scheme assets are as follows:
2018 |
2017 |
|
Cash and cash equivalents |
|
|
Equity instruments |
|
|
Debt instruments |
|
|
|
|
Return on scheme assets
2018 |
2017 |
|
Return on scheme assets |
|
|
The pension scheme has not invested in any of the company's own financial instruments or in properties or other assets used by the company.
Page 30 |
Pukka Pies Limited
Notes to the Financial Statements for the Period from 30 May 2017 to 28 May 2018
Principal actuarial assumptions
The principal actuarial assumptions at the statement of financial position date are as follows:
2018 |
2017 |
|
Discount rate |
|
|
Future salary increases |
|
|
Future pension increases |
|
|
Inflation |
|
|
Post retirement mortality assumptions
2018 |
2017 |
|
Current UK pensioners at retirement age - male |
22.00 |
22.00 |
Current UK pensioners at retirement age - female |
24.00 |
25.00 |
Future UK pensioners at retirement age - male |
23.00 |
24.00 |
Future UK pensioners at retirement age - female |
25.00 |
26.00 |
Share capital |
Allotted, called up and fully paid shares
2018 |
2017 |
|||
No. |
£ |
No. |
£ |
|
|
|
50,000 |
|
50,000 |
Page 31 |
Pukka Pies Limited
Notes to the Financial Statements for the Period from 30 May 2017 to 28 May 2018
Reserves |
Share capital
There is a single class of ordinary shares. All the shares hold full voting rights and there are no restrictions on the distribution of dividends and the repayment of capital.
Revaluation reserve
The revaluation reserve arose on the revaluation of certain fixed assets prior to transition to FRS 102. The amounts representing the equivalent depreciation are transferred to the profit and loss account reserve each year.
Profit and loss account
The profit and loss account reserve represents accumulated comprehensive income for the period and prior periods, transfers from the revaluation reserve relating to depreciation realised on revaluations, remeasurement of the net defined benefit plan and the associated tax effects less dividends paid.
The changes to each component of equity resulting from items of other comprehensive income for the current period were as follows:
Revaluation reserve |
Retained earnings |
Total |
|
Surplus/(deficit) on property, plant and equipment revaluation |
( |
|
- |
Remeasurement gain on defined benefit pension scheme |
- |
|
|
( |
|
|
|
The changes to each component of equity resulting from items of other comprehensive income for the prior period were as follows:
Revaluation reserve |
Retained earnings |
Total |
|
Surplus/(deficit) on property, plant and equipment revaluation |
( |
|
- |
Remeasurement gain on defined benefit pension scheme |
- |
|
|
( |
|
|
|
Page 32 |
Pukka Pies Limited
Notes to the Financial Statements for the Period from 30 May 2017 to 28 May 2018
Dividends |
2018 |
2017 |
|
£ |
£ |
|
Final dividend of £
|
2,000,000 |
2,000,000 |
Related party transactions |
Key management compensation
2018 |
2017 |
|
Salaries and other short term employee benefits |
|
|
Post-employment benefits |
|
|
|
|
Transactions with directors |
Dividends paid to directors |
2018 |
2017 |
|||
V. C. Storer |
||||
Dividend |
734,240 |
734,240 |
||
T. D. Storer |
||||
Dividend |
164,000 |
164,000 |
||
A. J. Storer |
||||
Dividend |
164,000 |
164,000 |
||
Summary of transactions with other related parties
Page 33 |