Harvard University Press Limited is a private company limited by shares incorporated in England and Wales . The registered office is 71 Queen Victoria Street, London, EC4V 4BE.
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 gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss .
Basic financial assets, which include debtors, 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 and loans from fellow group companies, 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.
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
At 30 June 20 22 , the company held stock on consignment with a value of £1,451,913 (2021: £1,157,510) .
The principal terms of the consignment agreement are such that the supplier can request the return or transfer of the goods while on consignment without compensation and the company can return the goods while on consignment to the supplier without penalties. For this reason, stock on consignment is not included in stock at the balance sheet date.
The financial statements have been prepared on the going concern basis, notwithstanding net liabilities of £414,948 (2021: £364,760) which the directors believe to be appropriate for the following reasons. The company is dependent for its working capital on funds provided by the President and Fellows of Harvard College (USA) which has indicated that, for at least 12 months from the date of approval of these financial statements, it will continue to make available such funds as are needed by the company and in particular will not seek repayment of the amounts currently made available. The directors consider that this should enable the company to continue in operational existence for the foreseeable future by meeting its liabilities as they fall due for payment. As with any company placing reliance on another group entity for financial support, the directors acknowledge that there can be no certainty that this support will continue although, at the date of approval of these financial statements, they have no reason to believe that it will not do so.
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.
Books sold by the company can be returned between 3 and 12 months after the initial sale. Determining the sale returns provision as at the balance sheet date requires management to make an estimate of future sales returns. This estimate is based on sales incurred prior to 30 June 2022 and managements knowledge of post year end return patterns in previous years, as well as current economic conditions. Based on this management provided for sales returns of £53,224 as at 30 June 2022 (2021: £43,925).
The average monthly number of persons (including directors) employed by the company during the year was:
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, as follows:
As at 30 June 2022, the company had an unsecured loan of £1,766,912 (2021: £1,386,720) due to The President and Fellows of Harvard College (USA), the ultimate controlling party. Interest of £31,318 was charged on the loan during the year. During the year cost of sales of £2,323,164 (2021: £2,579,647), administrative expenses of £73,334 (2021: £73,711) and other operating expenses of £10,673 (2021: £8,520) were charged to the company by The President and Fellows of Harvard College (USA). Throughout the year, the company charged expenses of £nil (2021: £9,776) to Harvard Business School Publishing Limited, a company which is also considered to be controlled by the The President of The Fellows of Harvard College (USA). As at 30 June 2022, a balance of £nil (2021: £nil) was owed to the company by Harvard Business School Publishing Limited.
Throughout the financial year the ultimate parent of the company was The President and Fellows of Harvard College (USA) whose address is 1562 Massachusetts Ave, Cambridge, MA02138, USA. There is not considered to be one controlling individual.
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.