Company Registration No. SC081893 (Scotland)
MERCHISTON ENTERPRISES LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2020
PAGES FOR FILING WITH REGISTRAR
MERCHISTON ENTERPRISES LIMITED
CONTENTS
Page
Balance sheet
1
Notes to the financial statements
2 - 6
MERCHISTON ENTERPRISES LIMITED
BALANCE SHEET
AS AT
31 JULY 2020
31 July 2020
- 1 -
2020
2019
as restated
Notes
£
£
£
£
Fixed assets
Tangible assets
4
-
-
Current assets
Stocks
91,070
93,917
Debtors
5
3,931
63
Cash at bank and in hand
73,740
123,608
168,741
217,588
Creditors: amounts falling due within one year
6
(135,539)
(184,733)
Net current assets
33,202
32,855
Capital and reserves
Profit and loss reserves
33,202
32,855
The directors of the company have 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 15 March 2021 and are signed on its behalf by:
G T G Baird
Director
Company Registration No. SC081893
MERCHISTON ENTERPRISES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 JULY 2020
- 2 -
1
Accounting policies
Company information
Merchiston Enterprises Limited is a
private
company
limited by
guarantee incorporated in Scotland.
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. The principal accounting policies adopted are set out below.
Merchiston
Enterprises
Limited is a wholly owned subsidiary of Merchiston Castle School, a company registered in Scotland. The results of Merchiston
Enterprises
Limited are included within the consolidated financial statements of Merchiston Castle School which are available at their registered office being 294 Colinton Road, Colinton, Edinburgh, EH13 0PU.
1.2
Going concern
A
true
t the time of approving the financial statements
,
t
he directors have a reasonable expectation that the
company
has adequate resources to continue in operational existence for the foreseeable future.
The directors have considered any potential implications of the Covid-19 pandemic in their assessment of going concern, and they do not believe that it will have a material impact on the company's going concern status. Accordingly,
t
he directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business
, and
is shown net of VAT and other sales related taxes
.
Turnover is recognised when the company has earned entitlement.
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:
Fixtures and fittings
20% per annum straight line
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
.
1.6
Stocks
Stocks are stated at the lower of cost and net realisable value. Cost is defined as the purchase cost of materials. Net realisable value is the amount which it is anticipated would be realised in the normal course of trade after making due allowance for discounts and selling expenses.
MERCHISTON ENTERPRISES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2020
1
Accounting policies
(Continued)
- 3 -
1.7
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.
1.8
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.
Debtors
Debtors with no stated interest rate and payable within one year are recorded at transaction price. Any losses arising from impairment are recognised in the profit and loss account.
Creditors
Creditors with no stated interest rate and payable within one year are recorded at transaction price.
All interest-bearing loans and borrowings which are basic financial instruments are initially recognised at the present value of cash payable. After initial recognition they are measured at amortised cost.
1.9
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The
company’s
liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and 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. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the
company
has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
MERCHISTON ENTERPRISES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2020
1
Accounting policies
(Continued)
- 4 -
1.10
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.11
Government grants
Government grants are recognised at the fair value of the asset receive
d
or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
A grant that specifies performance conditions is recognised in income when the performance conditions are met
. Where a
grant does not specify performance conditions
it
is recognised in income when the proceeds are received or receivable
. A grant received before the recognition criteria are satisfied is recognised as a liability.
2
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2020
2019
Number
Number
Total
1
2
3
Dividends and distributions
2020
2019
£
£
Distributions to parent charity under gift aid
Amounts paid
24,000
22,500
MERCHISTON ENTERPRISES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2020
- 5 -
4
Tangible fixed assets
Plant and machinery etc
£
Cost
At 1 August 2019 and 31 July 2020
4,479
Depreciation and impairment
At 1 August 2019 and 31 July 2020
4,479
Carrying amount
At 31 July 2020
-
At 31 July 2019
-
5
Debtors
2020
2019
Amounts falling due within one year:
£
£
Trade debtors
249
-
Other debtors
3,682
63
3,931
63
6
Creditors: amounts falling due within one year
2020
2019
£
£
Trade creditors
5,559
2,909
Amounts owed to group undertakings
125,690
175,998
Corporation tax
81
121
Other taxation and social security
-
824
Other creditors
4,209
4,881
135,539
184,733
7
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 Iain Binnie.
The auditor was Geoghegans.
MERCHISTON ENTERPRISES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 JULY 2020
- 6 -
8
Related party transactions
The company has taken advantage of the disclosure exemption available in FRS 102 section 33 whereby it has not disclosed transactions with the ultimate parent company.
The directors are of the opinion that all
other
related party transactions are conducted under normal market
conditions and on an arm's length basis and therefore do not need to be disclosed under FRS 102 section
1A appendix C.
9
Prior period adjustment
Reconciliation of changes in equity
1 August
31 July
2018
2019
£
£
Adjustments to prior year
Total adjustments
-
-
Equity as previously reported
31,748
32,855
Equity as adjusted
31,748
32,855
Notes to reconciliation
Gift aid payment to parent charity
The company pays an annual contribution from its taxable profits to its parent charity under the gift aid scheme. The company has changed its accounting policy as a result of The Financial Reporting Council clarifying the accounting treatment for such payments in its triennial review of FRS 102. These gift aid payments are now recognised as distributions to owners in equity within retained earnings. The company previously recognised gift aid payments in the profit and loss account as charitable donations. Therefore, the prior year comparative figures have been amended to reflect this change.