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Financial Statements for the Year Ended 31 December 2020 |
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Arcade Retail Limited |
REGISTERED NUMBER:
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Financial Statements for the Year Ended 31 December 2020 |
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for |
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Arcade Retail Limited |
Arcade Retail Limited (Registered number: 09583193) |
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Contents of the Financial Statements |
for the Year Ended 31 December 2020 |
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Company Information | 1 |
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Balance Sheet | 2 |
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Notes to the Financial Statements | 4 |
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Arcade Retail Limited |
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Company Information |
for the Year Ended 31 December 2020 |
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DIRECTORS: |
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REGISTERED OFFICE: |
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REGISTERED NUMBER: |
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AUDITORS: |
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Chartered accountant & statutory auditor |
19/20 Bourne Court |
Southend Road |
Woodford Green |
Essex |
IG8 8HD |
Arcade Retail Limited (Registered number: 09583193) |
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Balance Sheet |
31 December 2020 |
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31.12.20 | 31.12.19 |
Notes | £ | £ | £ | £ |
FIXED ASSETS |
Tangible assets | 5 |
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Investments | 6 |
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CURRENT ASSETS |
Stocks |
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Debtors | 7 |
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Cash in hand |
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CREDITORS |
Amounts falling due within one year | 8 |
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NET CURRENT LIABILITIES | ( |
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TOTAL ASSETS LESS CURRENT
LIABILITIES |
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CREDITORS |
Amounts falling due after more than
one year |
9 |
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( |
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PROVISIONS FOR LIABILITIES | ( |
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NET LIABILITIES | ( |
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CAPITAL AND RESERVES |
Called up share capital |
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Retained earnings | ( |
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( |
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Arcade Retail Limited (Registered number: 09583193) |
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Balance Sheet - continued |
31 December 2020 |
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In accordance with Section 444 of the Companies Act 2006, the Income Statement has not been delivered. |
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The financial statements were approved by the Board of Directors and authorised for issue on
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Arcade Retail Limited (Registered number: 09583193) |
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Notes to the Financial Statements |
for the Year Ended 31 December 2020 |
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1. | STATUTORY INFORMATION |
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Arcade Retail Limited is a
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2. | ACCOUNTING POLICIES |
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Basis of preparing the financial statements |
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The financial statements are prepared in sterling, which is the functional currency of the entity. |
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Significant judgements and estimates |
The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported. These estimates and judgements are continually reviewed and are based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. |
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Revenue recognition |
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: |
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Sale of goods |
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Revenue from the sale of goods is recognised when all of the following conditions are satisfied: |
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- the Company has transferred the significant risks and reward of ownership to the buyer; |
- the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold; |
- the amount of revenue can be measured reliably; |
- it is probable that the Company will receive the consideration due under the transaction; and |
- the costs incurred or to be incurred in respect of the transaction can be measured reliably. |
Arcade Retail Limited (Registered number: 09583193) |
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Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
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2. | ACCOUNTING POLICIES - continued |
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Tangible fixed assets |
Tangible assets are initially recorded at cost, and subsequently stated at cost less any accumulated depreciation and impairment losses. Any tangible assets carried at revalued amounts are recorded at the fair value at the date of revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses. |
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An increase in the carrying amount of an asset as a result of a revaluation is recognised in other comprehensive income and accumulated in equity, except to the extent it reverses a revaluation decrease of the same asset previously recognised in profit or loss. A decrease in the carrying amount of an asset as a result of revaluation is recognised in other comprehensive income to the extent of any previously recognised revaluation increase accumulated in equity in respect of that asset. Where a a revaluation decrease exceeds the accumulated revaluation gains accumulated in equity in respect of that asset, the excess shall be recognised in profit or loss. |
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Depreciation |
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Depreciation is calculated so as to write off the cost or valuation of an asset, less its residual value, over the useful economic life of that asset as follows: |
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Plant and machinery - 20% straight line |
Equipment - 33% straight line |
Arcade Retail Limited (Registered number: 09583193) |
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Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
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2. | ACCOUNTING POLICIES - continued |
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Stocks |
Stocks are measured at the lower of cost and estimated selling price less costs to complete and sell. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing the stock to its present location and condition. |
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Provisions |
Provisions are recognised when the entity has an obligation at the reporting date as a result of a past event, it is probable that the entity will be required to transfer economic benefits in settlement and the amount of the obligation can be estimated reliably. Provisions are recognised as a liability in the statement of financial position and the amount of the provision as an expense. |
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Provisions are initially measured at the best estimate of the amount required to settle the obligation at the reporting date and subsequently reviewed at each reporting date and adjusted to reflect the current best estimate of the amount that would be required to settle the obligation. Any adjustments to the amounts previously recognised are recognised in profit or loss unless the provision was originally recognised as part of the cost of an asset. When a provision is measured at the present value of the amount expected to be required to settle the obligation, the unwinding of the discount is recognised as a finance cost in profit or loss in the period it arises. |
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Financial instruments |
A financial asset or a financial liability is recognised only when the company becomes a party to the contractual provisions of the instrument. |
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Basic financial instruments are initially recognised at the transaction price, unless the arrangement constitutes a financing transaction, where it is recognised at the present value of the future payments discounted at a market rate of interest for a similar debt instrument. |
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Debt instruments are subsequently measured at amortised cost. |
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Where investments in non-convertible preference shares and non-puttable ordinary shares or preference shares are publicly traded or their fair value can otherwise be measured reliably, the investment is subsequently measured at fair value with changes in fair value recognised in profit or loss. All other such investments are subsequently measured at cost less impairment. |
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Other financial instruments, including derivatives, are initially recognised at fair value, unless payment for an asset is deferred beyond normal business terms or financed at a rate of interest that is not a market rate, in which case the asset is measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument. |
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Other financial instruments are subsequently measured at fair value, with any changes recognised in profit or loss, with the exception of hedging instruments in a designated hedging relationship. |
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Arcade Retail Limited (Registered number: 09583193) |
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Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
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2. | ACCOUNTING POLICIES - continued |
Financial assets that are measured at cost or amortised cost are reviewed for objective evidence of impairment at the end of each reporting date. If there is objective evidence of impairment, an impairment loss is recognised in profit or loss immediately. |
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For all equity instruments regardless of significance, and other financial assets that are individually significant, these are assessed individually for impairment. Other financial assets are either assessed individually or grouped on the basis of similar credit risk characteristics. |
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Any reversals of impairment are recognised in profit or loss immediately, to the extent that the reversal does not result in a carrying amount of the financial asset that exceeds what the carrying amount would have been had the impairment not previously been recognised. |
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Taxation |
The taxation expense represents the aggregate amount of current and deferred tax recognised in the reporting period. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, tax is recognised in other comprehensive income or directly in equity, respectively. |
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Current tax is recognised on taxable profit for the current and past periods. Current tax is measured at the amounts of tax expected to pay or recover using the tax rates and laws that have been enacted or substantively enacted at the reporting date. |
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Deferred tax |
Deferred tax is recognised in respect of all timing differences at the reporting date. Unrelieved tax losses and other 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. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date that are expected to apply to the reversal of the timing difference. |
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Foreign currencies |
Foreign currency transactions are initially recorded in the functional currency, by applying the spot exchange rate as at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the exchange rate ruling at the reporting date, with any gains or losses being taken to the profit and loss account. |
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Defined contribution plans |
Contributions to defined contribution plans are recognised as an expense in the period in which the related service is provided. Prepaid contributions are recognised as an asset to the extent that the prepayment will lead to a reduction in future payments or a cash refund. |
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When contributions are not expected to be settled wholly within 12 months of the end of the reporting date in which the employees render the related service, the liability is measured on a discounted present value basis. The unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises. |
Arcade Retail Limited (Registered number: 09583193) |
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Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
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2. | ACCOUNTING POLICIES - continued |
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Going concern |
The directors, in their consideration of going concern, have reviewed the company's future cash flow forecasts and revenue projects which they believe are based on market data and past experience of similar sectors. The company is subject to a number of significant risks and uncertainties, which could affect the company's ability to meet these forecasts. The directors believe that the company is adequately placed to manage its business risks. |
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After making enquiries, and taking into account the above, the directors have formed a judgement, at the time of approving the financial statements, that there is a reasonable expectation that the company has adequate resources to continue in operation for the foreseeable future. For this reason, they have adopted the going concern basis in preparing the financial statements. |
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Investments |
Fixed asset investments are initially recorded at cost, and subsequently stated at cost less any accumulated impairment losses. |
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Listed investments are measured at fair value with changes in fair value being recognised in profit or loss. |
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Investments in associates |
Investments in associates accounted for in accordance with the cost model are recorded at cost less any accumulated impairment losses. |
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Investments in associates accounted for in accordance with the fair value model are initially recorded at the transaction price. At each reporting date, the investments are measured at fair value, with changes in fair value recognised in other comprehensive income/profit or loss. Where it is impracticable to measure fair value reliably without undue cost or effort, the cost model will be adopted. |
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Dividends and other distributions received from the investment are recognised as income without regard to whether the distributions are from accumulated profits of the associate arising before or after the date of acquisition. |
Arcade Retail Limited (Registered number: 09583193) |
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Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
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2. | ACCOUNTING POLICIES - continued |
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Impairment of fixed assets |
A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date. |
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For the purposes of impairment testing, when it is not possible to estimate the recoverable amount of an individual asset, an estimate is made of the recoverable amount of the cash-generating unit to which the asset belongs. The cash-generating unit is the smallest identifiable group of assets that includes the asset and generates cash inflows that largely independent of the cash inflows from other assets or groups of assets. |
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For impairment testing of goodwill, the goodwill acquired in a business combination is, from the acquisition date, allocated to each of the cash-generating units that are expected to benefit from the synergies of the combination, irrespective of whether other assets or liabilities of the company are assigned to those units. |
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3. | EMPLOYEES AND DIRECTORS |
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The average number of employees during the year was
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4. | AUDITORS' REMUNERATION |
31.12.20 | 31.12.19 |
£ | £ |
Fees payable to the company's auditors for the audit of the
company's financial statements |
10,500 |
11,250 |
Arcade Retail Limited (Registered number: 09583193) |
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Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
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5. | TANGIBLE FIXED ASSETS |
Plant and |
machinery |
etc |
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COST |
At 1 January 2020 |
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Additions |
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At 31 December 2020 |
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DEPRECIATION |
At 1 January 2020 |
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Charge for year |
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At 31 December 2020 |
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NET BOOK VALUE |
At 31 December 2020 |
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At 31 December 2019 |
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6. | FIXED ASSET INVESTMENTS |
Shares in |
group |
undertakin |
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COST |
At 1 January 2020 |
and 31 December 2020 |
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NET BOOK VALUE |
At 31 December 2020 |
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At 31 December 2019 |
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The majority of investment held relates to We Are Pentagon K.K., a wholly owned subsidiary of the company. We Are Pentagon K.K. is registered at Deux Tours 51F, 3-13 Harumi, Chuo-ku, Tokyo, Japan. |
Arcade Retail Limited (Registered number: 09583193) |
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Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
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7. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
31.12.20 | 31.12.19 |
£ | £ |
Trade debtors |
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Amounts owed by group undertakings |
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Other debtors |
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Amounts owed by group undertakings are repayable on demand, are unsecured and accrue interest at 5%. |
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8. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
31.12.20 | 31.12.19 |
£ | £ |
Bank loans and overdrafts |
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Trade creditors |
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Amounts owed to group undertakings |
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Taxation and social security |
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Other creditors |
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Included in other creditors is an amount of £317,684 relating to the company's future invoice receivable transactions with Clearbanc. |
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9. |
CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN
ONE YEAR |
31.12.20 | 31.12.19 |
£ | £ |
Bank loans |
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Loans included in creditors have been secured by way of a floating charge on the assets of the company and a personal guarantee granted by one of the directors. |
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10. | DISCLOSURE UNDER SECTION 444(5B) OF THE COMPANIES ACT 2006 |
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The Report of the Auditors was unqualified. |
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for and on behalf of
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Arcade Retail Limited (Registered number: 09583193) |
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Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
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11. | PENSION COMMITMENTS |
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Arcade Retail Ltd operates a defined contribution scheme. |
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The assets of the scheme are held separately from the company. Contributions paid by the company to the scheme amounted to £5,357 (2019 - £942) in the year. Outstanding contributions as at 31 December 2020 were £nil (2019 - £213) and are included in creditors. |
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12. | CAPITAL COMMITMENTS |
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There were no capital commitments at balance sheet date. |
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13. | RELATED PARTY DISCLOSURES |
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The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group. |
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14. | AUDITOR LIABILITY LIMITATION AGREEMENT |
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The company has entered into a liability limitation agreement with Raffingers LLP, the statutory auditor, in respect of the statutory audit for the year ended 31 December 2020. The proportionate liability agreement follows the standard terms in Appendix B to the Financial Reporting Council's June 2008 Guidance on Auditor Liability Agreements, and was approved by the directors on 31 March 2021. |
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15. | POST BALANCE SHEET EVENTS |
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On 30 January 2020, the World Health Organisation declared the coronavirus (COVID-19) to be a public health emergency. There are no comparable recent events which may provide guidance as to the effect of the spread of COVID-19, and as a result, the ultimate impact of the COVID-19 outbreak is highly uncertain and subject to change and will need continual assessment over time. In our view, consistent with many others in the industry, COVID-19 is considered to be a non-adjusting post balance sheet event and therefore no adjustment is made in the financial statements. |
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The full extent of potential delays or impacts on our business, our operations or the global economy as a whole is as yet unknown. Should additional financing be required for the company to continue as a going concern, We Are Pentagon Group Limited has confirmed that they will support the company, providing financial support if required. |
Arcade Retail Limited (Registered number: 09583193) |
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Notes to the Financial Statements - continued |
for the Year Ended 31 December 2020 |
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16. | ULTIMATE CONTROLLING PARTY |
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The ultimate controlling party is
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The company is a subsidiary of We Are Pentagon Group Ltd, a company registered in England and Wales, located at 11 The Green, Richmond TW9 1PX. |
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The ultimate controlling party is Mr L Guy, by virtue of his majority share ownership of the parent company. |