Company Registration No. 02657061 (England and Wales)
KEL-BERG TRAILER AND TRUCKS LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2021
KEL-BERG TRAILER AND TRUCKS LIMITED
COMPANY INFORMATION
Directors
J Larsen
R Verner
Secretary
A M Kristensen
Company number
02657061
Registered office
Kel-Berg House
Middleton Stoney Road
Weston-on-the-Green
Bicester
Oxfordshire
OX25 3TH
Auditor
Ross Brooke Limited
Suite I, Windrush Court
Abingdon Business Park
Abingdon
Oxfordshire
OX14 1SY
KEL-BERG TRAILER AND TRUCKS LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Statement of comprehensive income
8
Statement of financial position
9
Statement of changes in equity
10
Statement of cash flows
11
Notes to the financial statements
12 - 25
KEL-BERG TRAILER AND TRUCKS LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 30 JUNE 2021
- 1 -
The directors present the strategic report for the year ended 30 June 2021.
Fair review of the business
The sales reported for the year are £34,225,655 compared to £23,620,217 for the year ended 30 June 2021.
The construction industry has again seen growth since last year. The company's good performance has given the directors confidence in the resilience of the market and believe this will continue. This performance has provided a boost to the existing resources and the directors will continue to expand the business. The directors are continuing to support the strategy in offering the most innovative trailers and related products.
The investment and development of our facilities in Bicester continues in 2021/22 and it's a key part of our strategy to be well placed in the market in the UK and Ireland.
The company generated profits this year of £1,
113,336
(2020: £696,818). The Kel-Berg brand is well accepted in the Europe, UK and Ireland and we will continue to build on this success.
Principal risks and uncertainties
The directors consider the company's principal risks and uncertainties to be:
Key performance indicators
The company uses many key performance indicators to monitor and assess the company's performance and core activities.
Sales
The company monitors sales comparing budgets with actual and benchmarking our progress with industry information available, and competitors. The performance indicators are considered monthly to ensure that the company is working efficiently to maximise sales.
Units rented
Each year we have the ambition to rent out more vehicles. We monitor monthly units rented and compare with budgeted figures. As with sales our operational tactics are changed if these are under achieved and this year, we have seen these increase again.
Gross margin
We try to maintain a consistent margin. However, due to market forces this is a critical performance monitoring area. Costs recently have increased due to economic factors affecting currency and consumer buying behaviour. The market currently is thriving but we remain on alert as cost increases are making the market unpredictable. Unfortunately, this affects the margin and the overall profitability of the company.
Other information and explanations
Sales have now returned to pre-pandemic levels and have increased to £3
4,225,655
,
from £23,620,217 reported for the year ended 30 June 2020.
The directors have assessed the potential future and anticipate sales to remain stable during the current year ending 2022.
The directors are pleased with the company's overall performance for the year and early indications are good for the year end 30 June 2022. We believe that we can experience similar sales going into next year and beyond, but we are still firmly focused on customer satisfaction as this has been key to our success to date.
KEL-BERG TRAILER AND TRUCKS LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2021
- 2 -
A M Kristensen
Secretary
22 December 2021
KEL-BERG TRAILER AND TRUCKS LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2021
- 3 -
The directors present their annual report and financial statements for the year ended 30 June 2021.
Principal activities
The principal activity of the company continued to be that of the retailing of commercial vehicles.
Results and dividends
The results for the year are set out on page 8.
No ordinary dividends were paid. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
J Larsen
R Verner
Research and development
The company carries out research and development to develop and refine manufacturing techniques. The research is aimed at constructing their own lorries from the chassis up instead of outsourcing this business activity to competitors.
Future developments
The directors are responding to the changes in demand for the company's products and are looking to invest in the business to keep up the supply and to build up the business' profile.
Auditor
The auditor, Ross Brooke Limited, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s
auditor
is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s
auditor
is aware of that information.
Going concern
The company's underlying performance has met the expectations of the board of directors, seeing consistent profits during the year. The company is expected to continue its sales, profits and matching positive cash inflows for the foreseeable future, and Board of Directors see no adverse events or circumstances that would change the their assessment over the company's ability to trade over the next 12 months. On this assessment the directors' believe that the going concern basis of accounting is appropriate.
By order of the board
A M Kristensen
Secretary
22 December 2021
KEL-BERG TRAILER AND TRUCKS LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 30 JUNE 2021
- 4 -
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
-
select suitable accounting policies and then apply them consistently;
-
make judgements and accounting estimates that are reasonable and prudent;
-
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
KEL-BERG TRAILER AND TRUCKS LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBER OF KEL-BERG TRAILER AND TRUCKS LIMITED
- 5 -
Opinion
We have audited the financial statements of Kel-Berg Trailer and Trucks Limited (the 'company') for the year ended 30 June 2021 which comprise the statement of comprehensive income, the statement of financial position, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including significant accounting policies.
The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102
The Financial Reporting Standard applicable in the UK and Republic of Ireland
(United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
-
give a true and fair view of the state of the company's affairs as at 30 June 2021 and of its profit for the year then ended;
-
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
-
have been prepared in accordance with the requirements of the Companies Act 2006.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the
Auditor's
responsibilities for the audit of the
financial statements
section of our report. We are independent of the
company
in accordance with the ethical requirements that are relevant to our audit of the
financial statements
in the UK, including the FRC’s Ethical Standard
, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit
:
-
the information given in the strategic report and the directors'
r
eport for the financial year for which the financial statements are prepared is consistent with the financial statements
; and
-
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
KEL-BERG TRAILER AND TRUCKS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF KEL-BERG TRAILER AND TRUCKS LIMITED
- 6 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identifie
d
material misstatements in the strategic report and the directors'
r
eport
.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
-
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
-
the financial statements are not in agreement with the accounting records and returns; or
-
certain disclosures of
remuneration specified by law are not made; or
-
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors'
r
esponsibilities
s
tatement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of
financial statements
that are free from material misstatement, whether due to fraud or error. In preparing the
financial statements
, the
directors are
responsible for assessing the company
'
s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the
directors
either
intend
to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the
financial statements
as a whole are free from material misstatement, whether due to fraud or error, and to issue an
auditor's
report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with
ISAs (UK)
will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these
financial statements
.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below
;
-
the nature of the industry and sector, control environment and business performance including the company's remuneration policy, bonus levels and performance targets;
-
the company's own assessment, including assessments made by key management, of the risks that irregularities may occur either as a result of fraud or error;
-
any matters we identified having reviewed the company's policies and procedures relating to:
-
identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance;
-
detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud; and
-
the internal controls established to mitigate risks of fraud or non-compliance with laws and regulations;
-
the matters discussed amongst the engagement team.
KEL-BERG TRAILER AND TRUCKS LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBER OF KEL-BERG TRAILER AND TRUCKS LIMITED
- 7 -
As a result of these procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in the areas in which management is required to exercise significant judgement, such as the disclosure of adjusting items. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override.
We also obtained an understanding of the legal and regulatory framework that the company operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context were the Companies Act, tax legislation and environmental regulations.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
This report is made solely to the company's member in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's member those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's member for our audit work, for this report, or for the opinions we have formed.
Caroline Webster (Senior Statutory Auditor)
for and on behalf of Ross Brooke Limited
22 December 2021
Chartered Accountants
Statutory Auditor
Suite I, Windrush Court
Abingdon Business Park
Abingdon
Oxfordshire
OX14 1SY
KEL-BERG TRAILER AND TRUCKS LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2021
- 8 -
2021
2020
Notes
£
£
Turnover
3
34,225,655
23,620,217
Cost of sales
(31,852,291)
(21,877,230)
Gross profit
2,373,364
1,742,987
Administrative expenses
(1,161,073)
(1,074,406)
Other operating income
21,800
46,948
Operating profit
4
1,234,091
715,529
Interest receivable and similar income
8
142,096
135,885
Interest payable and similar expenses
9
(1,259)
(2,689)
Profit before taxation
1,374,928
848,725
Tax on profit
10
(261,592)
(151,907)
Profit for the financial year
1,113,336
696,818
The income statement has been prepared on the basis that all operations are continuing operations.
KEL-BERG TRAILER AND TRUCKS LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT
30 JUNE 2021
30 June 2021
- 9 -
2021
2020
Notes
£
£
£
£
Fixed assets
Tangible assets
11
324,249
401,922
Investments
12
20
20
324,269
401,942
Current assets
Stocks
13
4,803,780
5,582,355
Debtors
14
5,725,534
5,417,266
Cash at bank and in hand
3,483,383
720,784
14,012,697
11,720,405
Creditors: amounts falling due within one year
15
(3,959,357)
(2,846,109)
Net current assets
10,053,340
8,874,296
Total assets less current liabilities
10,377,609
9,276,238
Provisions for liabilities
Deferred tax liability
17
60,006
71,971
(60,006)
(71,971)
Net assets
10,317,603
9,204,267
Capital and reserves
Called up share capital
19
2
2
Distributable profit and loss reserves
10,317,601
9,204,265
Total equity
10,317,603
9,204,267
The financial statements were approved by the board of directors and authorised for issue on 22 December 2021 and are signed on its behalf by:
J Larsen
Director
Company Registration No. 02657061
KEL-BERG TRAILER AND TRUCKS LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2021
- 10 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 July 2019
2
8,507,447
8,507,449
Year ended 30 June 2020:
Profit and total comprehensive income for the year
-
696,818
696,818
Balance at 30 June 2020
2
9,204,265
9,204,267
Year ended 30 June 2021:
Profit and total comprehensive income for the year
-
1,113,336
1,113,336
Balance at 30 June 2021
2
10,317,601
10,317,603
KEL-BERG TRAILER AND TRUCKS LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2021
- 11 -
2021
2020
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
23
2,803,731
491,497
Interest paid
(1,259)
(2,689)
Income taxes paid
(137,445)
(214,675)
Net cash inflow from operating activities
2,665,027
274,133
Investing activities
Purchase of tangible fixed assets
(60,740)
(171,811)
Proceeds on disposal of tangible fixed assets
22,217
Interest received
142,096
135,885
Net cash generated from/(used in) investing activities
103,573
(35,926)
Financing activities
Payment of finance leases obligations
(6,030)
(7,860)
Net cash used in financing activities
(6,030)
(7,860)
Net increase in cash and cash equivalents
2,762,570
230,347
Cash and cash equivalents at beginning of year
720,784
490,437
Cash and cash equivalents at end of year
3,483,354
720,784
Relating to:
Cash at bank and in hand
3,483,383
720,784
Bank overdrafts included in creditors payable within one year
(29)
KEL-BERG TRAILER AND TRUCKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2021
- 12 -
1
Accounting policies
Company information
Kel-Berg Trailer and Trucks Limited is a
private
company
limited by shares
incorporated in
England and Wales
.
The registered office is
Kel-Berg House, Middleton Stoney Road, Weston-on-the-Green, Bicester, Oxfordshire, OX25 3TH.
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.
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 £
1
.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
1.2
Going concern
A
true
t the time of approving the financial statements
,
t
he directors have
assessed the potential impact COVID-19 may have on the business. Since an initial drop in income for the year ended 2020, sales have returned to pre-pandemic levels increasing from £23,620,217 to £34,225,655 for the year ended 30 June 2021. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
Turnover
Turnover represents amounts receivable for commercial vehicles and repairs net of VAT.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer
(usually on dispatch of the goods)
, the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
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.
Qualifying expenditure exceeding £3,000 is capitalised to tangible assets. Capital expenditure below this threshold is expensed to the profit and loss.
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:
Land and buildings freehold
10% reducing balance
Plant and machinery
25% reducing balance
Fixtures, fittings & equipment
25% reducing balance
Motor vehicles
25% reducing balance
1.5
Fixed asset investments
Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
The investments are assessed for impairment at each reporting date
and
any
impairment
losses or reversals of impairment losses are recognised immediately in
profit
or
loss
.
KEL-BERG TRAILER AND TRUCKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2021
1
Accounting policies
(Continued)
- 13 -
An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The company considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.
1.6
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. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the
company
estimates the recoverable amount to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. An impairment loss is recognised immediately in
profit
or
loss
, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease
, and reversed if these conditions no longer apply.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit)
in
prior years. A reversal of an impairment loss is recognised immediately in
profit
or
loss
, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.7
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.
Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
1.8
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 with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
KEL-BERG TRAILER AND TRUCKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2021
1
Accounting policies
(Continued)
- 14 -
1.9
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 statement of financial position 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.
Basic financial assets
Basic financial assets, which include
debtors
and cash and bank balances, are initially measured at transaction price including transaction costs
.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in
profit
or
loss
, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
Impairment of financial assets
Financial assets, other than those
held
at
fair value through profit and loss
, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected.
If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when
the company
transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Classification of financial liabilities
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.
KEL-BERG TRAILER AND TRUCKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2021
1
Accounting policies
(Continued)
- 15 -
Basic financial 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
.
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
, if due after one year.
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts,
are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are
s
ubsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in
profit
or
loss
in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as
being measured at
fair value th
r
ough profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations
expire or are discharged or cancelled.
1.10
Equity instruments
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.
1.11
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
income statement
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.
KEL-BERG TRAILER AND TRUCKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2021
1
Accounting policies
(Continued)
- 16 -
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
income statement
, 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.
1.12
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.
1.13
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.14
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair
value at the date of inception and the present value of the minimum lease payments. The related liability is included in the statement of financial position as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Rentals payable under operating leases,
including
any lease incentives received, are charged to
profit or loss
on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the lease
s
asset are consumed.
1.15
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.
KEL-BERG TRAILER AND TRUCKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2021
1
Accounting policies
(Continued)
- 17 -
1.16
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation
in the period
are included in profit or loss.
2
Judgements and key sources of estimation uncertainty
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.
Critical judgements
The following judgements (apart from those involving estimates) have had the most significant
effect on amounts recognised in the financial statements.
Taxation
Determining income tax provisions involves judgements on the tax treatment of certain transactions. Deferred tax is recognised on accelerated capital allowances where a temporary difference occurs due to the estimated useful economic life of qualifying plant and machinery. The carry value of both current and deferred tax can be seen on note 9 and
20
.
Useful economic life of tangible fixed assets
The annual depreciation charge of tangible assets is sensitive to changes in the estimated useful economic life and residual values of recognised assets. These estimate are annually reviewed for an amendment in the adopted policy in the assets that are typically exposed to technological advancement, future investments, changes in economic utilisation, and the physical condition of the asset. See notes 1
0
for the carrying value of thee assets and note 1.
5
for the adopted useful economic life of each class of asset.
3
Turnover and other revenue
An analysis of the company's turnover is as follows:
2021
2020
£
£
Other significant revenue
Interest income
142,096
135,885
Grants received
21,800
46,948
KEL-BERG TRAILER AND TRUCKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2021
3
Turnover and other revenue
(Continued)
- 18 -
2021
2020
£
£
Turnover analysed by geographical market
United Kingdom
33,763,190
22,955,637
European Union
462,465
664,580
34,225,655
23,620,217
4
Operating profit
2021
2020
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange differences apart from those arising on financial instruments measured at fair value through profit or loss
109,992
(13,131)
Government grants
(21,800)
(46,948)
Depreciation of owned tangible fixed assets
121,390
133,972
Profit on disposal of tangible fixed assets
(5,194)
Operating lease charges
150,000
150,000
5
Auditor's remuneration
2021
2020
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
15,000
15,000
6
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2021
2020
Number
Number
Management
2
2
Administration
6
7
Workshop
15
12
Total
23
21
KEL-BERG TRAILER AND TRUCKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2021
6
Employees
(Continued)
- 19 -
Their aggregate remuneration comprised:
2021
2020
£
£
Wages and salaries
684,387
616,954
Social security costs
61,228
49,534
Pension costs
17,605
14,757
763,220
681,245
7
Directors' remuneration
2021
2020
£
£
Remuneration for qualifying services
70,000
70,000
Company pension contributions to defined contribution schemes
2,100
2,100
72,100
72,100
8
Interest receivable and similar income
2021
2020
£
£
Interest income
Other interest income
142,096
135,885
9
Interest payable and similar expenses
2021
2020
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
1,259
2,689
10
Taxation
2021
2020
£
£
Current tax
UK corporation tax on profits for the current period
273,557
137,445
Deferred tax
Origination and reversal of timing differences
(11,965)
14,462
Total tax charge
261,592
151,907
KEL-BERG TRAILER AND TRUCKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2021
10
Taxation
(Continued)
- 20 -
Changes to the UK corporation tax rate from 20% to 19%
were enacted
from 1 April 2017
.
Therefore, the current tax rate used is 19%
.
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2021
2020
£
£
Profit before taxation
1,374,928
848,725
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2020: 19.00%)
261,236
161,258
Tax effect of expenses that are not deductible in determining taxable profit
356
6,810
Research and development tax credit
(16,161)
Taxation charge for the year
261,592
151,907
11
Tangible fixed assets
Land and buildings freehold
Plant and machinery
Fixtures, fittings & equipment
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 July 2020
791
1,049,345
126,496
119,310
1,295,942
Additions
60,740
60,740
Disposals
(6,500)
(45,603)
(52,103)
At 30 June 2021
791
1,103,585
126,496
73,707
1,304,579
Depreciation and impairment
At 1 July 2020
791
697,930
118,499
76,800
894,020
Depreciation charged in the year
113,019
1,999
6,372
121,390
Eliminated in respect of disposals
(6,500)
(28,580)
(35,080)
At 30 June 2021
791
804,449
120,498
54,592
980,330
Carrying amount
At 30 June 2021
299,136
5,998
19,115
324,249
At 30 June 2020
351,415
7,997
42,510
401,922
KEL-BERG TRAILER AND TRUCKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2021
11
Tangible fixed assets
(Continued)
- 21 -
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
2021
2020
£
£
Motor vehicles
10,373
Total assets
with a carrying amount of
£324,249
(
2020 - £401,922
) have been pledged to secure borrowings of the company. The company is not allowed to pledge these assets as security for other borrowings or to sell them to another entity.
12
Fixed asset investments
2021
2020
£
£
Listed investments
20
20
Listed
investments
included above:
Listed investments carrying amount
20
20
13
Stocks
2021
2020
£
£
Finished goods and goods for resale
4,803,780
5,582,355
14
Debtors
2021
2020
Amounts falling due within one year:
£
£
Trade debtors
1,220,059
774,253
Other debtors
4,482,449
4,621,483
Prepayments and accrued income
23,026
21,530
5,725,534
5,417,266
Included in other debtors is an amount of £2,705,769 (2020 £2,718,255) due from a related company, of which £2,605,769 (2020 £2,618,255) is due more than one year from the balance sheet date.
KEL-BERG TRAILER AND TRUCKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2021
- 22 -
15
Creditors: amounts falling due within one year
2021
2020
Notes
£
£
Bank loans and overdrafts
29
Obligations under finance leases
16
6,030
Trade creditors
2,013,906
1,030,513
Corporation tax
273,557
137,445
Other taxation and social security
521,582
510,697
Other creditors
1,101,045
1,124,051
Accruals and deferred income
49,238
37,373
3,959,357
2,846,109
16
Finance lease obligations
2021
2020
Future minimum lease payments due under finance leases:
£
£
Within one year
6,030
Finance lease payments represent rentals payable by the company for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 3 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
17
Deferred taxation
Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:
Liabilities
Liabilities
2021
2020
Balances:
£
£
Accelerated capital allowances
60,006
71,971
2021
Movements in the year:
£
Liability at 1 July 2020
71,971
Credit to profit or loss
(11,965)
Liability at 30 June 2021
60,006
The value of deferred tax liability set out above that is expected to reverse within 12 months is £15,306 (2020: £18,653) and relates to accelerated capital allowances that are expected to mature within the same period.
KEL-BERG TRAILER AND TRUCKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2021
- 23 -
18
Retirement benefit schemes
2021
2020
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
17,605
14,757
The company operates a defined contribution pension scheme for all qualifying employees.
The assets of the scheme are held separately from those of the company in an independently administered fund.
19
Share capital
2021
2020
2021
2020
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
2
2
2
2
The company has one class of ordinary equity share. The shares have full voting rights and no restrictions on distributions.
20
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2021
2020
£
£
Within one year
150,000
150,000
Between two and five years
150,000
300,000
300,000
450,000
21
Related party transactions
Only the directors of the company are deemed to be Key Management Personnel and the value of compensation is stated on note 6.
Transactions with related parties
During the year the company entered into the following transactions with related parties:
Sale of goods
Purchase of goods
2021
2020
2021
2020
£
£
£
£
Other related parties
1,470,823
1,158,516
-
192,465
KEL-BERG TRAILER AND TRUCKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2021
21
Related party transactions
(Continued)
- 24 -
Commissions paid
2021
2020
£
£
Other related parties
723,453
428,081
Rent
During the year the company paid £150,000 (2020: £150,000) to a connected company by those in control. The rent enabled the company to occupy Kel-Berg House, its registered address.
Interes
t
During the year the company recharged interest of £69,700 (2020: £63,836) by a connected company by those in control.
The following amounts were outstanding at the reporting end date:
2021
2020
Amounts owed to related parties
£
£
Other related parties
847,798
1,052,700
2021
2020
Amounts owed by related parties
£
£
Other related parties
4,482,449
4,606,344
At the reporting date outstanding balances between various connected UK and overseas based companies that carry out specific complimentary services to complete the company's business activities, all were conducted under normal market conditions; charging interest of 6.9%. These loans are due on demand, except as detailed in note 14. These entities are all owed by those with control, and have been referred to as other related parties in these financial statements.
22
Ultimate controlling party
The ultimate controlling party is Mr J K Larsen.
KEL-BERG TRAILER AND TRUCKS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2021
- 25 -
23
Cash generated from operations
2021
2020
£
£
Profit for the year after tax
1,113,336
696,818
Adjustments for:
Taxation charged
261,592
151,907
Finance costs
1,259
2,689
Investment income
(142,096)
(135,885)
Gain on disposal of tangible fixed assets
(5,194)
Depreciation and impairment of tangible fixed assets
121,390
133,972
Movements in working capital:
Decrease in stocks
778,575
123,572
(Increase)/decrease in debtors
(308,268)
392,974
Increase/(decrease) in creditors
983,137
(874,550)
Cash generated from operations
2,803,731
491,497
24
Analysis of changes in net funds
1 July 2020
Cash flows
30 June 2021
£
£
£
Cash at bank and in hand
720,784
2,762,599
3,483,383
Bank overdrafts
(29)
(29)
720,784
2,762,570
3,483,354
Obligations under finance leases
(6,030)
6,030
-
714,754
2,768,600
3,483,354
2021-06-30
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