Wise Zone Ltd is a private company limited by shares incorporated in England and Wales. The registered office is Unit 4m Crossley Park, Heaton Chapel, Stockport, England, SK4 5BF.
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 £.
These financial statements are prepared on the going concern basis. There was a net deficiency of assets of £342,533 at the balance sheet date, however the directors have confirmed continued support and consider the company retains sufficient working capital to continue trading for the foreseeable future. Loans from a third party have been arranged by the directors to assist in the company's business activities to date. Further support is to be provided by the directors as and when is required for the foreseeable future.
At the time of filing these financial statements, the pandemic of Covid-19 is creating an uncertainty on the effect on the general macro-economy. The directors have carefully considered the potential implications of Covid-19 on the company’s business environment. No staff members are directly employed by the company, so there has been no requirement to make use of the furlough scheme. The Company has not taken any grants or long term loans made available following the pandemic.
Having regard to the above, the directors believe it appropriate to adopt the going concern basis of accounting in preparing the financial statements.
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.
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, 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.
Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recognised in profit or loss immediately, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.
The average monthly number of persons (including directors) employed by the company during the year was:
Fixed asset investments consist of shares held in the subsidiary and are measured at cost less impairment. These are detailed in note 5.
Details of the company's subsidiaries at 31 October 2020 are as follows:
In 2018, the company purchased a property on behalf of Plymouth Grove Property Developments Limited resulting in a balance owed to the company at 31 October 2020 £2,542,850 (in 2019 of £2,542, 851) and is included within debtors due within one year.
There is no interest payable on this balance and the loans are unsecured loans with no fixed repayment dates.
As at 31 October 2020 the company owed Insighttex Trading Limited an amount of £2,906,494 (in 2019 of £2,775,027) and is included within creditors due within one year. Of this amount, £20,000 was received in April 2020. This balance includes interest payable totalling £111,468 which has been charged at an annual rate of 4%.
It has been agreed between both parties that the length of the loan must not exceed 10 years, however Insighttex Trading Limited reserve the right to call for repayment of the loans on demand by providing 1 months' notice. The loans are otherwise unsecured loans with no fixed repayment dates.
T he company has taken advantage of the exemption available under FRS 102 not to disclose transactions between itself and its subsidiary company, Plymouth Grove Property Developments Ltd .
During the period, the company operated a loan account with director Mrs M Li. At the balance sheet date, the company owed Mrs M Li £901 (2019 - £901), this is included within other creditors.
This loan is repayable on demand and no interest was charged during the period.