Company Registration No. 02044770 (England and Wales)
JAMES SMITH (SCOTLAND NURSERIES) LIMITED
FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2019
PAGES FOR FILING WITH REGISTRAR
JAMES SMITH (SCOTLAND NURSERIES) LIMITED
CONTENTS
Page
Balance sheet
1
Notes to the financial statements
2 - 8
JAMES SMITH (SCOTLAND NURSERIES) LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2019
31 December 2019
- 1 -
31 December 2019
31 January 2019
Notes
£
£
£
£
Fixed assets
Tangible assets
5
469,592
513,069
Current assets
Debtors
6
12,647
80,807
Creditors: amounts falling due within one year
7
(2,718)
(271,911)
Net current assets/(liabilities)
9,929
(191,104)
Total assets less current liabilities
479,521
321,965
Capital and reserves
Called up share capital
8
6
6
Share premium account
532,602
532,602
Profit and loss reserves
(53,087)
(210,643)
Total equity
479,521
321,965
The director of the company has elected not to include a copy of the profit and loss account within the financial statements.
true
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 26 May 2021 and are signed on its behalf by:
P Stubbs
Director
Company Registration No. 02044770
JAMES SMITH (SCOTLAND NURSERIES) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2019
- 2 -
1
Accounting policies
Company information
James Smith (Scotland Nurseries) Limited is a
private
company
limited by shares
incorporated in England and Wales.
The registered office is
Brigg Garden Centre, Bigby High Road, Brigg, DN20 9HE.
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 freehold properties and to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.
1.2
Going concern
The directors have considered the impact of COVID-19 on the company's trade, workforce and supply chain, as well as the wider economy. Whilst it is not considered practical to accurately assess the duration and extent of the disruption, the directors are confident that they have in place plans to deal with any financial losses that may arise.
true
In addition to this, the nature of the Company's operations are that of a company which holds property on behalf of it's parent and any costs associated with this property will be recharged. It is the intention for the garden centres to continue trading within BGC South Ltd and the property held will continue to be used. It is f
or this reason
that
the
directors
continue to adopt the going concern basis in preparing the financial statements.
1.3
Reporting period
The company has changed its accounting date from 31 January 2020 to 31 December 2019. This change has been applied to be in line with the other companies in the group. As a result of this change, the comparative amounts presented in the financial statements (including the related notes) are not entirely comparable.
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:
Freehold land and buildings
2% on cost
Plant and equipment
10% on cost
Fixtures and fittings
20% on cost
Computer equipment
25% on cost
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
.
Freehold property includes land and buildings; freehold land is not depreciated.
JAMES SMITH (SCOTLAND NURSERIES) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2019
1
Accounting policies
(Continued)
- 3 -
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.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit)
in
prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.6
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.
1.7
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.
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.
JAMES SMITH (SCOTLAND NURSERIES) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2019
1
Accounting policies
(Continued)
- 4 -
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.
1.8
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.
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the director is 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.
Critical judgements
The following judgements (apart from those involving estimates) have had the most significant
effect on amounts recognised in the financial statements.
Useful economic lives of tangible fixed assets
The annual depreciation charge for tangible 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 and are
amended when necessary to reflect current estimates.
3
Employees
The average monthly number of persons employed by the company during the period was:
31 December 2019
31 January 2019
Number
Number
Total
-
JAMES SMITH (SCOTLAND NURSERIES) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2019
- 5 -
4
Amounts written off investments
31 December 2019
31 January 2019
£
£
Amounts written back to financial assets held at cost
238,363
-
Amounts written off financial liabilities
(80,807)
-
157,556
-
On 19 December 2019, BGC South Ltd acquired the entire share capital of the Company from Hillview Garden Centres Limited. As part of the Share Purchase Agreement, it was agreed that there would be no outstanding indebtedness between any member of the Company and the seller. As a result of this, amounts totalling £157,556 have been written off during the year.
5
Tangible fixed assets
Freehold land and buildings
Plant and equipment
Fixtures and fittings
Computer equipment
Total
£
£
£
£
£
Cost
At 1 February 2019
269,864
371,520
127,420
23,219
792,023
Additions
-
2,897
-
-
2,897
At 31 December 2019
269,864
374,417
127,420
23,219
794,920
Depreciation and impairment
At 1 February 2019
25,319
148,478
91,359
13,798
278,954
Depreciation charged in the period
4,387
26,035
10,631
5,321
46,374
At 31 December 2019
29,706
174,513
101,990
19,119
325,328
Carrying amount
At 31 December 2019
240,158
199,904
25,430
4,100
469,592
At 31 January 2019
244,545
223,042
36,061
9,421
513,069
6
Debtors
31 December 2019
31 January 2019
Amounts falling due within one year:
£
£
Amounts owed by group undertakings
12,647
80,807
Amounts owed by group undertakings are unsecured, have no fixed date of repayment and are repayable on demand.
During the period and prior to the acquisition of the company by BGC South Ltd, the amounts owed from group undertakings were waived by the respective group undertaking. The total of the amounts waived during the period is shown in note 4 to the accounts.
JAMES SMITH (SCOTLAND NURSERIES) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2019
- 6 -
7
Creditors: amounts falling due within one year
31 December 2019
31 January 2019
£
£
Amounts owed to group undertakings
2,718
271,911
Amounts owed to group undertakings are unsecured, have no fixed date of repayment and are repayable on demand.
During the period and prior to the acquisition of the company by BGC South Ltd, the amounts owed to group undertakings were waived by the respective group undertaking. The total of the amounts waived during the period is shown in note 4 to the accounts.
8
Called up share capital
31 December 2019
31 January 2019
31 December 2019
31 January 2019
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
6
6
6
6
9
Audit report information
As the income statement has been omitted from the filing copy of the financial statements
,
the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006
:
The auditor's report was unqualified.
The senior statutory auditor was Daniel Sowden.
The auditor was BHP LLP.
10
Financial commitments, guarantees and contingent liabilities
During the year ended 31 January 2017 the
c
ompany entered into a cross guarantee agreement along with its parent and fellow subsidiaries relating to group wide bank overdraft and loan facilities. The guarantee
was
secured by a fixed and floating charge over the company's assets. A
s at 31 January 2019
the overdrawn balance was £834,971 and the bank loan balance was £2,135,669
. As part of the terms and conditions of the sale on 19 December 2019 (see note 12), the loan balance remained with the parent company, Hillview Garden Centres Limited and, as a result of this, there is no longer a cross guarantee in place for the company.
On 19 December 2019 the company entered into a new cross guarantee agreement along with its parent, BGC South Ltd, and fellow subsidiaries relating to loan notes totalling £10,000,000 issued in BGC South Ltd. The guarantee is secured by a fixed and floating charge over the company's assets.
JAMES SMITH (SCOTLAND NURSERIES) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2019
- 7 -
11
Events after the reporting date
In the first quarter of 2020 the Covid-19 pandemic resulted in governments across the World introducing stringent measures to prevent the spread of the coronavirus disease. These measures included population 'lock-down' and led to a significant reduction in economic activity which in turn has led to significant falls in global markets, including the FTSE100.
It is the view of the Directors that the events which have significantly impacted the Company are the direct result of Government and international policy in response to the pandemic (for example restrictions on travel, trade and personal interactions) and such policy only arose after the balance sheet date. The Directors therefore consider the impact of the COVID-19 on the business to be a non-adjusting post-balance sheet event.
On 31 October 2020, the trade and assets of the Company with the exception of the property held were transferred to BGC South Ltd.
JAMES SMITH (SCOTLAND NURSERIES) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2019
- 8 -
12
Related party transactions
During the year, amounts owed to Hillview Garden Centres Limited totalling £58,573 were waived. At the balance sheet date, the total amount owed to Hillview Garden Centres Limited was £nil (31 January 2019: £58,573).
The Company has taken the exemption set out in FRS 102 from disclosing transactions with other wholly owned members of the group.
13
Parent company
On 19 December 2019 a third party, BGC South Ltd, acquired the entire share capital of the Company from the Company's previous parent, Hillview Garden Centres Limited. The terms of the agreement stipulated that the Company was to be acquired debt free, with no outstanding loans, obligations or guarantees in place at this date.
Following this transaction, the Company's immediate parent is BGC South Ltd, incorporated in England and Wales, and is the parent of both the smallest and largest group preparing consolidated financial statements that include the Company. Copies of the financial statements for this company can be obtained from Companies House.
The ultimate controlling party is considered to be P Stubbs and H Thomis by virtue of their shareholding in BGC South Ltd.