Company Registration No. 01068577 (England and Wales)
ARTO CHEMICALS LIMITED
UNAUDITED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2019
PAGES FOR FILING WITH REGISTRAR
ARTO CHEMICALS LIMITED
CONTENTS
Page
Statement of financial position
1
Statement of changes in equity
2
Notes to the financial statements
3 - 7
ARTO CHEMICALS LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT
30 SEPTEMBER 2019
30 September 2019
- 1 -
2019
2018
Notes
£
£
£
£
Non-current assets
Property, plant and equipment
3
374,247
386,591
Investment properties
4
715,000
715,000
1,089,247
1,101,591
Current assets
Inventories
1,166,741
1,387,755
Trade and other receivables
5
1,035,979
1,145,103
Cash and cash equivalents
4,266,774
4,065,973
6,469,494
6,598,831
Current liabilities
6
(530,474)
(636,776)
Net current assets
5,939,020
5,962,055
Total assets less current liabilities
7,028,267
7,063,646
Equity
Called up share capital
7
1,500,000
1,500,000
Other reserves
214,532
214,532
Retained earnings
5,313,735
5,349,114
Total equity
7,028,267
7,063,646
The directors of the company have elected not to include a copy of the income statement within the financial statements.
true
For the financial year ended 30 September 2019 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.
The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.
T
he members have not required the company to obtain an audit of its financial statements for the year in question in accordance with section 476
.
These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The financial statements were approved by the board of directors and authorised for issue on 2 June 2020 and are signed on its behalf by:
Miss S M Miklos
Director
Company Registration No. 01068577
ARTO CHEMICALS LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 SEPTEMBER 2019
- 2 -
Share capital
Investment property revaluation reserve
Retained earnings
Total
Notes
£
£
£
£
Balance at 1 October 2017
1,500,000
229,532
6,039,630
7,769,162
Year ended 30 September 2018:
Profit and total comprehensive income for the year
-
-
194,484
194,484
Dividends
-
-
(900,000)
(900,000)
Transfers
-
(15,000)
15,000
-
Balance at 30 September 2018
1,500,000
214,532
5,349,114
7,063,646
Year ended 30 September 2019:
Profit and total comprehensive income for the year
-
-
114,621
114,621
Dividends
-
-
(150,000)
(150,000)
Balance at 30 September 2019
1,500,000
214,532
5,313,735
7,028,267
ARTO CHEMICALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2019
- 3 -
1
Accounting policies
Company information
Arto Chemicals Limited is a
private
company
limited by shares
incorporated in England and Wales.
The registered office is
Arto House, London Road, Binfield, Bracknell, Berks, RG42 4BU.
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 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
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 investment properties. The principal accounting policies adopted are set out below.
1.2
Going concern
As stated in note
true
8
, the director
s
ha
ve
considered the effect of the Covid-19 outbreak. The director
s
considers that the outbreak is unlikely to cause a significant disruption to the company’s business and
are
confident that the company can continue as a going concern for a period of at least twelve months from the date of approval of these financial statements. The director
s
ha
ve
a reasonable expectation that the company has adequate resources to continue in operation for the foreseeable future
.
The validity of this assumption is on the basis of that the company will continue to be supported by the directors.
1.3
Revenue
Revenue is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business
, and
is shown net of VAT and other sales related taxes
.
The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
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
Property, plant and equipment
Property, plant and equipment
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:
Freehold land and buildings
2%/10% on cost
Fixtures and fittings
15%/25% on cost
Motor vehicles
25% on net book value
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
.
1.5
Investment properties
Investment propert
ies
which
are
propert
ies
held to earn rentals and/or for capital appreciation,
are
measured using the fair value model and stated at
their
fair value as the reporting end date.
The surplus or deficit on revaluation is recognised in the income statement.
ARTO CHEMICALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2019
1
Accounting policies
(Continued)
- 4 -
1.6
Impairment of non-current 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.
1.7
Inventories
Inventories 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 inventories to their present location and condition.
Inventories held for distribution at no or nominal consideration are measured at the lower of replacement cost and cost, adjusted where applicable for any loss of service potential.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of inventories 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.
1.8
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.
1.9
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 trade and other receivables 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.
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 trade and other payables, 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 receipts 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.
ARTO CHEMICALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2019
1
Accounting policies
(Continued)
- 5 -
1.10
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.
1.11
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 income statement 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 liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the
company
has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.12
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 non-current 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.
1.13
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.14
Leases
Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.
2
Employees
The average monthly number of persons (including directors) employed by the company during the year was 7 (2018 - 7).
ARTO CHEMICALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2019
- 6 -
3
Property, plant and equipment
Freehold land and buildings
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
Cost
At 1 October 2018
574,542
114,103
69,890
758,535
Additions
-
4,814
-
4,814
At 30 September 2019
574,542
118,917
69,890
763,349
Depreciation and impairment
At 1 October 2018
216,463
111,426
44,055
371,944
Depreciation charged in the year
7,931
2,763
6,464
17,158
At 30 September 2019
224,394
114,189
50,519
389,102
Carrying amount
At 30 September 2019
350,148
4,728
19,371
374,247
At 30 September 2018
358,079
2,677
25,835
386,591
Included in the cost of freehold land, buildings and improvements are buildings and improvements in the sum of £349,510 which have been depreciated in accordance with the company's policy.
4
Investment properties
2019
£
Fair value
At 1 October 2018 and 30 September 2019
715,000
Investment propert
ies
comprise
freehold investment properties £
390
,000
(2018 - £390,000)
and long leasehold investment properties of £3
25,000 (2018 - £325
,
000). The fair value of the investment propert
ies
has been arrived at on the basis of a valuation carried out at
30th September 201
9 by
directors' of
the company. The valuation was made on an open market value basis by reference to market evidence of transaction prices for similar properties.
5
Trade and other receivables
2019
2018
Amounts falling due within one year:
£
£
Trade receivables
962,752
1,089,643
Other receivables
15,565
12,773
Prepayments and accrued income
57,662
42,687
1,035,979
1,145,103
ARTO CHEMICALS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2019
- 7 -
6
Current liabilities
2019
2018
£
£
Trade payables
306,022
338,852
Corporation tax
28,946
60,750
Other taxation and social security
36,222
82,530
Other payables
121,750
114,901
Accruals and deferred income
37,534
39,743
530,474
636,776
7
Called up share capital
2019
2018
£
£
Ordinary share capital
Issued and fully paid
500,000 Ordinary A shares of £1 each
500,000
500,000
1,000,000 Ordinary B shares of £1 each
1,000,000
1,000,000
1,500,000
1,500,000
"A" Ordinary Shares are voting shares and carry voting rights on all matters. "B" Ordinary Shares are non-voting shares and are not entitled to vote at general meetings of the company unless the business of the meeting is or includes consideration of a resolution relating to certain matters as specified in Clause 4.2 of the Articles of Association, in which case holders of "B" Ordinary Shares shall be entitled to vote on such resolution.
8
Events after the reporting date
The director
s
ha
ve
considered the effect of the Covid-19 outbreak, that has been spreading throughout the world in early 2020, on the company’s activities. This outbreak is
un
likely to cause a significant disruption to the company’s business but at the date of approval of these financial statements, the extent and quantum of the disruption remains uncertain
.