Company registration number:
02874855
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FOR THE YEAR ENDED
31 DECEMBER 2021
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ABRASIVE TECHNOLOGY LIMITED
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ABRASIVE TECHNOLOGY LIMITED
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COMPANY INFORMATION
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L M Peterman
(resigned
14 September 2022
)
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S A Narrol
(appointed
13 December 2022
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G T Topping
(appointed
12 September 2022
)
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C D Wiekrykas
(appointed
13 September 2022
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Unit11 Boundary Business Court
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Chartered Accountants
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Statutory Auditor
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ABRASIVE TECHNOLOGY LIMITED
REGISTERED NUMBER:
02874855
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STATEMENT OF FINANCIAL POSITION
AS AT
31 DECEMBER 2021
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Creditors: amounts falling due after more than one year
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Provisions for liabilities
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The
financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime and in accordance with the provisions of FRS 102 Section 1A - small entities.
The financial statements have been delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The Company has opted not to file the statement of comprehensive income in accordance with provisions applicable to companies subject to the small companies' regime.
The financial statements were approved and authorised for issue by the board and were signed on its behalf by
:
The notes on pages 4 to 11 form part of these financial statements.
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ABRASIVE TECHNOLOGY LIMITED
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STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED
31 DECEMBER 2021
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Comprehensive income for the year
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Surplus on revaluation of freehold property
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Other comprehensive income for the year
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Total comprehensive income for the year
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The notes on pages 4 to 11 form part of these financial statements.
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ABRASIVE TECHNOLOGY LIMITED
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STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED
31 DECEMBER 2020
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Comprehensive income for the year
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Surplus on revaluation of freehold property
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Other comprehensive income for the year
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Total comprehensive income for the year
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The notes on pages 4 to 11 form part of these financial statements.
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ABRASIVE TECHNOLOGY LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
Abrasive Technology Limited is a private company limited by shares and incorporated in England and Wales. The address of the registered office is given on the company information page.
The principal activity of the Company, continues to be the manufacture of a wide range of tooling products, incorporating industrial diamonds and other super abrasives.
2.
Accounting policies
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Basis of preparation of financial statements
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The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Section 1A of
Financial Reporting Standard 102, the Financial Reporting Standard applicable in
the UK and the Republic of Ireland and the Companies Act 2006
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The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the Company's accounting policies (see note 3).
The following principal accounting policies have been applied:
The Company has made a loss before tax of £453,625 (2020: £824,457) and the net assets have reduced from £1,655,341 to £1,201,716.
The Company meets its day to day working capital requirements through capital, accumulated reserves and cash at bank and in hand. Based upon the working capital requirements identified from the forecasts prepared for the next twelve months, the Company is reliant on the support of the parent company to continue its operations. The Company has received a formal undertaking from its parent company that it will continue to provide such financial support for the foreseeable future and for a period of at least twelve months from the date of signing the financial statements. On this basis, the director considers it appropriate to prepare the financial statements on a going concern basis.
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Foreign currency translation
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Functional and presentation currency
The Company's functional and presentational currency is GBP.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.
Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Statement of comprehensive income within 'finance income or costs'. All other foreign exchange gains and losses are presented in profit or loss within 'other operating income'.
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ABRASIVE TECHNOLOGY LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
2.
Accounting policies (continued)
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:
Sale of goods
Revenue from the sale of goods is recognised when the buyer has received written acknowledgement of acceptance of the order, and the Company has delivered goods to the carrier, at which point substantially all of the risks and rewards of ownership have transferred to the buyer.
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Operating leases: the Company as lessee
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Rentals paid under operating leases are charged to the statement of comprehensive income on a straight-line basis over the lease term.
Grants are accounted under the accruals model as permitted by FRS 102.
Grants relating to expenditure on tangible fixed assets are credited to profit or loss at the same rate as the depreciation on the assets to which the grant relates. The deferred element of grants is included in creditors as deferred income.
Grants of a revenue nature are recognised in the Statement of Comprehensive Income in the same period the as the related expenditure.
Government grants were received in the form of an Award of Non-repayable funding to Aid Capital Invesment and as part of the Coronavirus Job Retention Scheme, there are no unfufilled conditions or other contingencies in relation to these grants received.
Defined contribution pension plan
The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of financial position. The assets of the plan are held separately from the Company in independently administered funds.
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ABRASIVE TECHNOLOGY LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
2.
Accounting policies (continued)
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Current and deferred taxation
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Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
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 income.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the reporting date, except that:
∙
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
∙
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.
Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.
Exceptional items are transactions that fall within the ordinary activities of the Company but are presented separately due to their size or incidence.
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
At each reporting date the company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.
The Company adds to the carrying amount of an item of fixed assets the cost of replacing part of such an item when that cost is incurred, if the replacement part is expected to provide incremental future benefits to the Company. The carrying amount of the replaced part is derecognised. Repairs and maintenance are charged to profit or loss during the period in which they are incurred.
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ABRASIVE TECHNOLOGY LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
2.
Accounting policies (continued)
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Tangible fixed assets (continued)
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Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
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Long-term leasehold property
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Over the term of the lease
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The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
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Impairment of fixed assets and goodwill
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Assets that are subject to depreciation or amortisation are assessed at each reporting date to determine whether there is any indication that the assets are impaired. Where there is any indication that an asset may be impaired, the carrying value of the asset (or cash-generating unit to which the asset has been allocated) is tested for impairment. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's (or CGU's) fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (CGUs). Non-financial assets that have been previously impaired are reviewed at each reporting date to assess whether there is any indication that the impairment losses recognised in prior periods may no longer exist or may have decreased.
The company had previously taken advantage of the arrangements under Financial Reporting Standard 15 'Tangible fixed assets' (old UK GAAP) which allowed the carrying value of those assets acquired prior to 31 December 1999, which had been revalued, to be retained. All additions to fixed assets since this date are stated at cost. Where an asset that was previously revalued is disposed of, its book value is eliminated and an appropriate transfer made from the revaluation reserve to the statement of comprehensive income.
Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads.
At each reporting date, stocks are assessed for impairment. If stock is 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.
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ABRASIVE TECHNOLOGY LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
2.
Accounting policies (continued)
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Provisions for liabilities
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Provisions are made where an event has taken place that gives the Company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.
Provisions are charged as an expense to profit or loss in the year that the Company becomes aware of the obligation, and are measured at the best estimate at the reporting date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.
When payments are eventually made, they are charged to the provision carried in the Statement of financial position.
The Company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Statement of comprehensive income.
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Judgements in applying accounting policies and key sources of estimation uncertainty
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In preparing these financial statements, the director has had to make the following judgements:
Key source of estimation uncertainty - fixed asset impairment
Determine whether there are indicators of impairment of the company's tangible assets. Factors taken into consideration in reaching such a decision include the economic viability and expected future financial performance of the asset and where it is a component of a larger cash-generating unit, the viability and expected future performance of that unit.
Key source of estimation uncertainty - fixed asset depreciation
Tangible fixed assets are depreciated over their useful lives taking into account residual values, where appropriate. The actual lives of the assets and residual values are assessed annually and may vary depending on a number of factors. In re-assessing asset lives, factors such as technological innovation, product life cycles and maintenance programmes are taken into account. Residual value assessments consider issues such as future market conditions, the remaining life of the asset and projected disposal values.
Key source of estimation uncertainty - work in progress
Work in progress valuation is estimated on a percentage of the sales price allocated to materials issued and labour costs incurred. Percentages are based on management's best estimates of the actual costs incurred for each individual project.
Key source of estimation uncertainty - stock valuation
Stock items may include an element of wastage incorporated into the cost. This is an estimate based off of stocktakes performed to confirm the amount of stock that is actually utilised in the production process for manufactured items.
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The average monthly number of employees, including directors, during the year was 32
(2020 -
36
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ABRASIVE TECHNOLOGY LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
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ABRASIVE TECHNOLOGY LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
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Due after more than one year
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Prepayments and accrued income
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Creditors: Amounts falling due within one year
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Amounts owed to group undertakings
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Other taxation and social security
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Accruals and deferred income
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Creditors: Amounts falling due after more than one year
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Government grants received
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Charged to profit or loss
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ABRASIVE TECHNOLOGY LIMITED
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NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2021
Share premium account
The share premium account includes the premium on issues of equity shares, net of any issue costs.
Revaluation reserve
The revaluation reserve represents the surplus on revaluation of freehold land and buildings.
Profit and loss account
The profit and loss account represents cumulative profits or losses, net of dividends paid and other adjustments.
The company's ultimate parent undertaking is Abrasive Technology Inc., incorporated in the USA and up until 30 April 2021, the ultimate controlling party was L M Peterman Jnr. The registered office of Abrasive Technology Inc is 8400 Green Meadows Dr, PO Box 545, Lewis Center, OH, 43035, United States.
From 30 April 2021, the ultimate controlling party is Blue Sea Capital.
The auditors' report on the financial statements for the year ended 31 December 2021 was unqualified.
The audit report was signed on
23 December 2022
by
Caroline Milton
(Senior statutory auditor) on behalf of
Menzies LLP
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