Life Guitars Co. Ltd
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Notes to the Accounts |
for the period from 20 January 2020 to 30 April 2021
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1 |
Accounting policies |
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Turnover |
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Turnover is measured at the fair value of the consideration received or receivable, net of discounts and value added taxes. Turnover includes revenue earned from the sale of goods and from the rendering of services. Turnover from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have transferred to the buyer.
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Tangible fixed assets |
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Tangible fixed assets are measured at cost less accumulative depreciation and any accumulative impairment losses. Depreciation is provided on all tangible fixed assets, other than freehold land, at rates calculated to write off the cost, less estimated residual value, of each asset evenly over its expected useful life, as follows:
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Plant and machinery |
over 5 years |
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Stocks |
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Stocks are measured at the lower of cost and estimated selling price less costs to complete and sell. Cost is determined using the first in first out method. The carrying amount of stock sold is recognised as an expense in the period in which the related revenue is recognised.
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Debtors and creditors receivable/payable within one year |
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Debtors and creditors with no stated interest rate and receivable or payable within one year are recorded at transaction price. Any losses arising from impairment are recognised in the profit and loss account in other administrative expenses.
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Taxation |
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A current tax liability is recognised for the tax payable on the taxable profit of the current and past periods. A current tax asset is recognised in respect of a tax loss that can be carried back to recover tax paid in a previous period. Deferred tax is recognised in respect of all timing differences between the recognition of income and expenses in the financial statements and their inclusion in tax assessments. Unrelieved tax losses and other deferred tax assets are recognised only 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 and that are expected to apply to the reversal of the timing difference, except for revalued land and investment property where the tax rate that applies to the sale of the asset is used. Current and deferred tax assets and liabilities are not discounted.
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Pensions |
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Contributions to defined contribution plans are expensed in the period to which they relate.
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Grants |
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Grants are accounted for under the accruals model. Grants relating to revenue are recognised in income on a systematic basis over the periods in which the entity recognises the related costs for which the grant is intended to compensate. Grants relating to assets are recognised in income on a systematic basis over the expected useful life of the asset. |
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Impact of Covid-19 |
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The Directors considered that despite the Covid 19 pandemic declared on 11 March 2020 by the World Health Organisation, the Company has adequate resources to continue in operational existence. In reaching this conclusion, the Directors have considered the following: the effect of Covid 19 on the business to date, projected cash flow requirements and results and in general the risks that could impact on the Company's liquidity and solvency over the 12 months following the approval of the Financial Statements. Whilst it has suffered the same uncertainties and lack of reliable information as to the effects of the pandemic as all other businesses, and has had to make some use of the furlough scheme due to lockdown closures, it has nevertheless performed better in the financial year under review. The Directors have concluded that the Company has adequate resources to continue as a going concern for the foreseeable future. The accounts have therefore been prepared on a going concern basis using the historical cost convention. |
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2 |
Employees |
2021 |
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Number |
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Average number of persons employed by the company |
2 |
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3 |
Tangible fixed assets |
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Plant and machinery etc |
£ |
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Cost |
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Additions |
64 |
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At 30 April 2021 |
64 |
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Depreciation |
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Charge for the period |
16 |
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At 30 April 2021 |
16 |
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Net book value |
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At 30 April 2021 |
48 |
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4 |
Debtors |
2021 |
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£ |
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Deferred tax asset |
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650 |
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Other debtors |
499 |
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1,149 |
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5 |
Creditors: amounts falling due within one year |
2021 |
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£ |
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Trade creditors |
107 |
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Taxation and social security costs |
3,614 |
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Other creditors |
11,266 |
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14,987 |
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6 |
Other information |
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Life Guitars Co. Ltd is a private company limited by shares and incorporated in England. Its registered office is: |
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70 South Street |
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Exeter |
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England |
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EX1 1EG |