REGISTERED NUMBER: |
Strategic Report, Report of the Directors and |
Financial Statements for the Year Ended 30 September 2022 |
for |
Blends Flavours & Colours Limited |
REGISTERED NUMBER: |
Strategic Report, Report of the Directors and |
Financial Statements for the Year Ended 30 September 2022 |
for |
Blends Flavours & Colours Limited |
Blends Flavours & Colours Limited (Registered number: 10670248) |
Contents of the Financial Statements |
for the Year Ended 30 September 2022 |
Page |
Company Information | 1 |
Strategic Report | 2 |
Report of the Directors | 4 |
Report of the Independent Auditors | 5 |
Income Statement | 8 |
Other Comprehensive Income | 9 |
Balance Sheet | 10 |
Statement of Changes in Equity | 11 |
Cash Flow Statement | 12 |
Notes to the Cash Flow Statement | 13 |
Notes to the Financial Statements | 15 |
Blends Flavours & Colours Limited |
Company Information |
for the Year Ended 30 September 2022 |
DIRECTORS: |
SECRETARY: |
REGISTERED OFFICE: |
REGISTERED NUMBER: |
AUDITORS: |
Chartered Accountants and Statutory Auditors |
Westminster House |
10 Westminster Road |
Macclesfield |
Cheshire |
SK10 1BX |
Blends Flavours & Colours Limited (Registered number: 10670248) |
Strategic Report |
for the Year Ended 30 September 2022 |
The directors present their strategic report for the year ended 30 September 2022. |
REVIEW OF BUSINESS |
Blends Flavours & Colours Ltd operates from Blends House on Overbrook Lane. Prior to October 2018, the flavour side of the business was incorporated together with the commodity business under Blends Ltd. We chose to separate the two entities for clarity. |
We are a British Retail Consortium (BRC) accredited company and achieved an AA grade certificate in January 2022. We enjoy a growing role in blending and co-packing for well-known brands, and continue to focus our efforts in growth of these areas, as well as innovation and project management. |
We have seen year on year growth since the company was separated into two entities in October 2018 and we foresee considerable growth to continue over the next 12 months. Our employee number total is currently 83. |
The new Plant and Machinery that we invested in this year is due to be fully operational by the end of 2022, which will enable us to offer a wider range of co-packing services. |
Our achievements have been previously recognised at the Knowsley Business Regeneration Awards, where Blends Group achieved the award for Excellence in Manufacturing/Logistics in November 2018 and again in June 2019 where we were pleased to be awarded Winner of the Echo Regional Business of the year. We were also incredibly pleased to be shortlisted for Manufacturer of the Year (Made in the North West awards 2019) and more recently Medium Business of the Year (Knowsley Business Awards 2022). |
PRINCIPAL RISKS AND UNCERTAINTIES |
There have been unprecedented price increases during the year, which has impacted on our overall Gross Profit margin. This is definitely an area of uncertainty, but will continue to monitor this and adapt our business accordingly to keep ahead of the curve. |
ANALYSIS OF DEVELOPMENT AND PERFORMANCE |
Adding a canning line to our business has also added a new revenue stream, which has had a positive increase in our turnover. We continue to target Retailers, new and growing flavour markets and have seen an increase in spray dried flavour sales. Sports nutrition continues to be a growing sector as well, and is an area we would like to invest more time in. |
We have recruited in many areas of the business, adding 11 employees to the Engineering, Technical and Production teams. This is ahead of our plans to go to a 24/7 site in November 2022. |
Our ERP, which went live last year continues to improve our efficiency and traceability processes. It is adaptable to our business needs, so given the right attention, can really improve the accuracy of our business. |
The quality of our employees contributes to the success of Blends. We will continue to invest in them in training and development. We ensure that opportunities are given to our employees, to progress within the business, and will support them in this path. |
KPI Analysis |
Sales were up by 21.5%: |
2021 - £8,669,251 |
2022 - £10,536,646 |
Gross Profit for the third financial year has achieved 34.4%, as opposed to 41.9% the previous year. This is mainly due to increased material costs. |
Blends Flavours & Colours Limited (Registered number: 10670248) |
Strategic Report |
for the Year Ended 30 September 2022 |
FUTURE DEVELOPMENT AND RESEARCH |
Our plans for the coming year are to update our existing bottling facility in order to cope with the growing demand. The potential to add some end of line equipment is also in discussions, which will improve efficiency. |
Phase two of our ERP system is almost complete, which will see the improvement of our NPD module, meaning our projects will be managed effectively and provide a quicker turnaround of these projects. |
ON BEHALF OF THE BOARD: |
Blends Flavours & Colours Limited (Registered number: 10670248) |
Report of the Directors |
for the Year Ended 30 September 2022 |
The directors present their report with the financial statements of the company for the year ended 30 September 2022. |
PRINCIPAL ACTIVITY |
The principal activity of the company in the year under review was that of manufacturer of other food products. |
DIVIDENDS |
The total distribution of dividends for the year ended 30 September 2022 will be £58,500 (2021: £58,500). |
DIRECTORS |
The directors shown below have held office during the whole of the period from 1 October 2021 to the date of this report. |
STATEMENT OF DIRECTORS' RESPONSIBILITIES |
The directors are responsible for preparing the Strategic Report, the Report of the Directors 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. |
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS |
So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditors are aware of that information. |
AUDITORS |
The auditors, Harts Limited, will be proposed for re-appointment at the forthcoming Annual General Meeting. |
ON BEHALF OF THE BOARD: |
Report of the Independent Auditors to the Members of |
Blends Flavours & Colours Limited |
Opinion |
We have audited the financial statements of Blends Flavours & Colours Limited (the 'company') for the year ended 30 September 2022 which comprise the Income Statement, Other Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement and Notes to the Cash Flow Statement, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 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 September 2022 and of its loss 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. |
Basis for opinion |
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 Auditors' 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 significant 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. |
Other information |
The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon. |
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. |
In connection with our audit of the financial statements, 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 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 the audit: |
- | the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
- | the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements. |
Report of the Independent Auditors to the Members of |
Blends Flavours & Colours Limited |
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 identified material misstatements in the Strategic Report or the Report of the Directors. |
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 directors' 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 Statement of Directors' Responsibilities set out on page four, 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 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. |
Auditors' 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 a Report of the Auditors 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. |
The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below: |
The objectives of our audit, in respect to fraud, are: to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses; and to respond appropriately to fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the entity and management. |
Our approach was as follows: |
We obtained an understanding of the legal and regulatory frameworks that are applicable to the Company and determined that the most significant are the Companies Act 2006, Health and Safety and general food regulations. |
We understood how Blends Flavours and Colours Limited is complying with those frameworks by making inquiries of management responsible for company legislation and certification procedures. |
We corroborated our enquiries through discussion with the Directors to identify any non-compliance with laws and regulations. |
We assessed the susceptibility of the Company's financial statements to material misstatement, including how fraud might occur by discussion with directors to understand where its considered there was a susceptibility to fraud. We considered the controls that the Company has established to address risks identified, or that otherwise prevent, deter and detect fraud. |
To address the risk of fraud through management bias and override of controls, we performed analytical procedures to identify and unusual or unexpected relationships; investigated the rationale behind significant or unusual transactions; and tested journal entries to identify unusual transactions. |
Report of the Independent Auditors to the Members of |
Blends Flavours & Colours Limited |
There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations enquiry of the directors and other management and inspection of regulatory and legal correspondence, if any. Material misstatement that arises due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion. |
Based on this understanding we designed our audit procedures to identify non-compliance with such laws and regulations that could materially impact the financial statements. Taking into accounts our understanding of the Company, our procedures involved enquires of management and focussed testing as appropriate with consideration to risk assessment. |
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors. |
Use of our report |
This report is made solely to the company's members, as a body, 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 members those matters we are required to state to them in a Report of the Auditors 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 members as a body, for our audit work, for this report, or for the opinions we have formed. |
for and on behalf of |
Chartered Accountants and Statutory Auditors |
Westminster House |
10 Westminster Road |
Macclesfield |
Cheshire |
SK10 1BX |
Blends Flavours & Colours Limited (Registered number: 10670248) |
Income Statement |
for the Year Ended 30 September 2022 |
30.9.22 | 30.9.21 |
Notes | £ | £ |
TURNOVER | 3 |
Cost of sales | ( |
) | ( |
) |
GROSS PROFIT |
Administrative expenses | ( |
) | ( |
) |
(818,513 | ) | 258,477 |
Other operating income |
OPERATING (LOSS)/PROFIT | 5 | ( |
) |
Interest receivable and similar income | 7 |
(814,690 | ) | 270,454 |
Interest payable and similar expenses | 8 | ( |
) | ( |
) |
(LOSS)/PROFIT BEFORE TAXATION | ( |
) |
Tax on (loss)/profit | 9 |
(LOSS)/PROFIT FOR THE FINANCIAL YEAR | ( |
) |
Blends Flavours & Colours Limited (Registered number: 10670248) |
Other Comprehensive Income |
for the Year Ended 30 September 2022 |
30.9.22 | 30.9.21 |
Notes | £ | £ |
(LOSS)/PROFIT FOR THE YEAR | ( |
) |
OTHER COMPREHENSIVE INCOME |
Revaluation in year | ( |
) |
Income tax relating to other comprehensive income |
OTHER COMPREHENSIVE INCOME FOR THE YEAR, NET OF INCOME TAX |
( |
) |
TOTAL COMPREHENSIVE INCOME FOR THE YEAR |
( |
) |
Blends Flavours & Colours Limited (Registered number: 10670248) |
Balance Sheet |
30 September 2022 |
30.9.22 | 30.9.21 |
Notes | £ | £ |
FIXED ASSETS |
Tangible assets | 11 |
CURRENT ASSETS |
Stocks | 12 |
Debtors | 13 |
Cash at bank |
CREDITORS |
Amounts falling due within one year | 14 | ( |
) | ( |
) |
NET CURRENT LIABILITIES | ( |
) | ( |
) |
TOTAL ASSETS LESS CURRENT LIABILITIES |
CREDITORS |
Amounts falling due after more than one year |
15 |
( |
) |
PROVISIONS FOR LIABILITIES | 18 | ( |
) |
NET ASSETS |
CAPITAL AND RESERVES |
Called up share capital | 19 |
Revaluation reserve | 20 | ( |
) | ( |
) |
Retained earnings | 20 |
SHAREHOLDERS' FUNDS |
The financial statements were approved by the Board of Directors and authorised for issue on |
Blends Flavours & Colours Limited (Registered number: 10670248) |
Statement of Changes in Equity |
for the Year Ended 30 September 2022 |
Called up |
share | Retained | Revaluation | Total |
capital | earnings | reserve | equity |
£ | £ | £ | £ |
Balance at 1 October 2020 |
Changes in equity |
Dividends | - | ( |
) | - | ( |
) |
Total comprehensive income | - | 493,477 | ( |
) | 380,536 |
Balance at 30 September 2021 | ( |
) |
Changes in equity |
Dividends | - | ( |
) | - | ( |
) |
Total comprehensive income | - | ( |
) | ( |
) |
Balance at 30 September 2022 | ( |
) |
Blends Flavours & Colours Limited (Registered number: 10670248) |
Cash Flow Statement |
for the Year Ended 30 September 2022 |
30.9.22 | 30.9.21 |
Notes | £ | £ |
Cash flows from operating activities |
Cash generated from operations | 1 | ( |
) |
Interest paid | ( |
) | ( |
) |
Interest element of hire purchase payments paid |
( |
) |
( |
) |
Tax paid |
Net cash from operating activities | ( |
) |
Cash flows from investing activities |
Purchase of tangible fixed assets | ( |
) | ( |
) |
Sale of tangible fixed assets |
Interest received |
Net cash from investing activities | ( |
) | ( |
) |
Cash flows from financing activities |
New loans in year |
Capital repayments in year | ( |
) |
Amount introduced by directors | 70,328 | 68,526 |
Amount withdrawn by directors | (110,625 | ) | (124,691 | ) |
Equity dividends paid | ( |
) | ( |
) |
Net cash from financing activities |
Increase/(decrease) in cash and cash equivalents | ( |
) |
Cash and cash equivalents at beginning of year |
2 |
(819,603 |
) |
(182,553 |
) |
Cash and cash equivalents at end of year | 2 | 64,118 | ( |
) |
Blends Flavours & Colours Limited (Registered number: 10670248) |
Notes to the Cash Flow Statement |
for the Year Ended 30 September 2022 |
1. | RECONCILIATION OF (LOSS)/PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS |
30.9.22 | 30.9.21 |
£ | £ |
(Loss)/profit before taxation | ( |
) |
Depreciation charges |
Profit on disposal of fixed assets | ( |
) | ( |
) |
Loss on revaluation of fixed assets | - | 112,941 |
Finance costs | 66,155 | 31,326 |
Finance income | (3,091 | ) | (839 | ) |
(289,803 | ) | 659,215 |
Increase in stocks | ( |
) | ( |
) |
Decrease/(increase) in trade and other debtors | ( |
) |
Increase in trade and other creditors |
Cash generated from operations | ( |
) |
2. | CASH AND CASH EQUIVALENTS |
The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts: |
Year ended 30 September 2022 |
30.9.22 | 1.10.21 |
£ | £ |
Cash and cash equivalents | 64,118 | 71,322 |
Bank overdrafts | ( |
) |
64,118 | (819,603 | ) |
Year ended 30 September 2021 |
30.9.21 | 1.10.20 |
£ | £ |
Cash and cash equivalents | 71,322 | 146,155 |
Bank overdrafts | ( |
) | ( |
) |
(819,603 | ) | (182,553 | ) |
Blends Flavours & Colours Limited (Registered number: 10670248) |
Notes to the Cash Flow Statement |
for the Year Ended 30 September 2022 |
3. | ANALYSIS OF CHANGES IN NET DEBT |
At 1.10.21 | Cash flow | At 30.9.22 |
£ | £ | £ |
Net cash |
Cash at bank | 71,322 | (7,204 | ) | 64,118 |
Bank overdrafts | (890,925 | ) | 890,925 | - |
(819,603 | ) | 64,118 |
Debt |
Finance leases | (1,268 | ) | (16,707 | ) | (17,975 | ) |
Debts falling due within 1 year | (1,387,343 | ) | 1,015,183 | (372,160 | ) |
Debts falling due after 1 year | - | (2,539,591 | ) | (2,539,591 | ) |
(1,388,611 | ) | (1,541,115 | ) | (2,929,726 | ) |
Total | (2,208,214 | ) | (657,394 | ) | (2,865,608 | ) |
Blends Flavours & Colours Limited (Registered number: 10670248) |
Notes to the Financial Statements |
for the Year Ended 30 September 2022 |
1. | STATUTORY INFORMATION |
Blends Flavours & Colours Limited is a |
Although Blends flavours & colours limited registered address is at Overbrook lane, it primarily operates from Picton House, Knowsley Business Park, Kitling Rd, Knowsley, Prescot, L34 9JA. |
2. | ACCOUNTING POLICIES |
Basis of preparing the financial statements |
Turnover |
Turnover is recognised at the fair value of the consideration received or receivable for goods provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates. |
When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income. |
Turnover from the sale of goods is recognised when significant risks and rewards of ownership of the goods have transferred to the buyer, the amount of turnover can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the company and the costs incurred or to be incurred in respect of the transaction can be measured reliably. This is usually on despatch date. |
Turnover from services is recognised by reference to the stage of completion at the balance sheet date. Stage of completion is measured by reference to finalisation of work completed. |
Tangible fixed assets |
Freehold property | - |
Plant and machinery | - |
Motor vehicles | - |
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 of the cash-generating unit 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 (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) 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. |
Blends Flavours & Colours Limited (Registered number: 10670248) |
Notes to the Financial Statements - continued |
for the Year Ended 30 September 2022 |
2. | ACCOUNTING POLICIES - continued |
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. |
Government grants |
Government grants in relation to expenditure are credited when the expenditure is charged to profit and loss. |
Stocks |
Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items. |
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. |
Basic financial assets |
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. |
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. If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal 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. |
Blends Flavours & Colours Limited (Registered number: 10670248) |
Notes to the Financial Statements - continued |
for the Year Ended 30 September 2022 |
2. | ACCOUNTING POLICIES - continued |
Basic financial liabilities |
Basic financial liabilities, including creditors, bank loans 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 payments 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. Amounts 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. |
Derecognition of financial liabilities |
Financial liabilities are derecognised when the company's contractual obligations expire or are discharged or cancelled. |
Taxation |
Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. |
Current or deferred taxation assets and liabilities are not discounted. |
Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date. |
Deferred tax |
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date. |
Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference. |
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. |
Research and development |
Research expenditure is written off against profits in the year in which it is incurred. Identifiable development expenditure is capitalised to the extent that the technical, commercial and financial feasibility can be demonstrated. |
Foreign currencies |
Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result. |
Hire purchase and leasing commitments |
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 balance sheet 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. |
Blends Flavours & Colours Limited (Registered number: 10670248) |
Notes to the Financial Statements - continued |
for the Year Ended 30 September 2022 |
2. | ACCOUNTING POLICIES - continued |
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 leases asset are consumed. |
Pension costs and other post-retirement benefits |
The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate. |
Going concern |
At the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. The company has the ability to trade in the future with support from the directors and other connected companies. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements. |
Cash and cash equivalents |
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities. |
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. |
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 |
3. | TURNOVER |
The turnover and loss (2021 - profit) before taxation are attributable to the one principal activity of the company. |
An analysis of turnover by geographical market is given below: |
30.9.22 | 30.9.21 |
£ | £ |
United Kingdom |
30.9.22 | 30.9.21 |
£ | £ |
Other Revenue |
Interest income | 3,091 | 839 |
Grants received | 732 | 11,138 |
Blends Flavours & Colours Limited (Registered number: 10670248) |
Notes to the Financial Statements - continued |
for the Year Ended 30 September 2022 |
4. | EMPLOYEES AND DIRECTORS |
30.9.22 | 30.9.21 |
£ | £ |
Wages and salaries |
Social security costs |
Other pension costs |
The average number of employees during the year was as follows: |
30.9.22 | 30.9.21 |
Directors | 2 | 2 |
Production | 11 | 9 |
Administration | 7 | 8 |
Sales | 5 | 3 |
Cleaning | 4 | 3 |
Technical/Innovation | 14 | 10 |
Repack | 31 | 34 |
Maintenance | 6 | 2 |
30.9.22 | 30.9.21 |
£ | £ |
Directors' remuneration |
5. | OPERATING (LOSS)/PROFIT |
The operating loss (2021 - operating profit) is stated after charging/(crediting): |
30.9.22 | 30.9.21 |
£ | £ |
Hire of plant and machinery |
Other operating leases |
Depreciation - owned assets |
Profit on disposal of fixed assets | ( |
) | ( |
) |
6. | AUDITORS' REMUNERATION |
30.9.22 | 30.9.21 |
£ | £ |
Fees payable to the company's auditors for the audit of the company's financial statements |
12,007 |
7,000 |
7. | INTEREST RECEIVABLE AND SIMILAR INCOME |
30.9.22 | 30.9.21 |
£ | £ |
Deposit account interest |
Other interest received |
Blends Flavours & Colours Limited (Registered number: 10670248) |
Notes to the Financial Statements - continued |
for the Year Ended 30 September 2022 |
8. | INTEREST PAYABLE AND SIMILAR EXPENSES |
30.9.22 | 30.9.21 |
£ | £ |
Bank interest |
Hire purchase interest |
9. | TAXATION |
Analysis of the tax credit |
The tax credit on the loss for the year was as follows: |
30.9.22 | 30.9.21 |
£ | £ |
Current tax: |
UK corporation tax | ( |
) |
(Over) Under provision in prior year | (20,259 | ) | (118,983 | ) |
Total current tax | ( |
) | ( |
) |
Deferred tax | ( |
) |
Tax on (loss)/profit | ( |
) | ( |
) |
Reconciliation of total tax credit included in profit and loss |
The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained below: |
30.9.22 | 30.9.21 |
£ | £ |
(Loss)/profit before tax | ( |
) |
(Loss)/profit multiplied by the standard rate of corporation tax in the UK of |
( |
) |
Effects of: |
Expenses not deductible for tax purposes | ( |
) | ( |
) |
Adjustments to tax charge in respect of previous periods | ( |
) | ( |
) |
Deferred tax | (30,674 | ) | 44,755 |
Total tax credit | (469,144 | ) | (141,408 | ) |
Tax effects relating to effects of other comprehensive income |
There were no tax effects for the year ended 30 September 2022. |
30.9.21 |
Gross | Tax | Net |
£ | £ | £ |
Revaluation in year | ( |
) | - | (112,941 | ) |
10. | DIVIDENDS |
The total distribution of dividends for the year ended 30 September 2022 will be £58,500 (2021: £58,500). |
Blends Flavours & Colours Limited (Registered number: 10670248) |
Notes to the Financial Statements - continued |
for the Year Ended 30 September 2022 |
11. | TANGIBLE FIXED ASSETS |
Freehold | Plant and | Motor |
property | machinery | vehicles | Totals |
£ | £ | £ | £ |
COST OR VALUATION |
At 1 October 2021 |
Additions |
Disposals | ( |
) | ( |
) |
At 30 September 2022 |
DEPRECIATION |
At 1 October 2021 |
Charge for year |
Eliminated on disposal | ( |
) | ( |
) |
At 30 September 2022 |
NET BOOK VALUE |
At 30 September 2022 |
At 30 September 2021 |
Included in the total net book value of assets was £4,300.15 in respect of assets held under finance leases. |
Cost or valuation at 30 September 2022 is represented by: |
Freehold | Plant and | Motor |
property | machinery | vehicles | Totals |
£ | £ | £ | £ |
Valuation in 2021 | (112,941 | ) | - | - | (112,941 | ) |
Cost | 3,137,073 | 5,191,782 | 13,009 | 8,341,864 |
3,024,132 | 5,191,782 | 13,009 | 8,228,923 |
If Last year, freehold property had not been revalued it would have been included at the following historical cost: |
30.9.22 | 30.9.21 |
£ | £ |
Cost | 3,137,073 | 2,812,941 |
Freehold property was valued on an open market basis on 17 December 2021 by Matthews & Goodman . |
12. | STOCKS |
30.9.22 | 30.9.21 |
£ | £ |
Stocks |
Raw materials |
Finished goods |
Blends Flavours & Colours Limited (Registered number: 10670248) |
Notes to the Financial Statements - continued |
for the Year Ended 30 September 2022 |
13. | DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
30.9.22 | 30.9.21 |
£ | £ |
Trade debtors |
Other debtors | ( |
) |
Directors' current accounts | 95,390 | 54,703 |
VAT |
Deferred tax asset |
Prepayments |
14. | CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR |
30.9.22 | 30.9.21 |
£ | £ |
Bank loans and overdrafts (see note 16) |
Hire purchase contracts (see note 17) |
Trade creditors |
Corporation tax | ( |
) | ( |
) |
Social security and other taxes |
VAT | - | 80,017 |
Other creditors |
Directors' current accounts | 2,092 | 1,702 |
Accrued expenses |
Included in creditors due within one year are the following borrowings: |
- A bank loan with a 5 year term. The loan bears interest at 2.75% above the Bank of England base rate. |
- A bank loan with a 5 year term. The loan bears interest at 2.35% above the Bank of England base rate. |
15. | CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR |
30.9.22 | 30.9.21 |
£ | £ |
Bank loans (see note 16) |
Hire purchase contracts (see note 17) |
Included in creditors due after one year are the following borrowings: |
- A bank loan with a 5 year term. The loan bears interest at 2.75% above the Bank of England base rate. |
- A bank loan with a 5 year term. The loan bears interest at 2.35% above the Bank of England base rate. |
Blends Flavours & Colours Limited (Registered number: 10670248) |
Notes to the Financial Statements - continued |
for the Year Ended 30 September 2022 |
16. | LOANS |
An analysis of the maturity of loans is given below: |
30.9.22 | 30.9.21 |
£ | £ |
Amounts falling due within one year or on demand: |
Bank overdrafts |
Bank loans |
Amounts falling due between one and two years: |
Bank loans - 1-2 years |
Amounts falling due between two and five years: |
Bank loans - 2-5 years |
Amounts falling due in more than five years: |
Repayable by instalments |
Bank loans more 5 yr by instal | 1,177,313 | - |
17. | LEASING AGREEMENTS |
Minimum lease payments fall due as follows: |
Hire purchase contracts |
30.9.22 | 30.9.21 |
£ | £ |
Net obligations repayable: |
Within one year |
Between one and five years |
Non-cancellable operating | leases |
30.9.22 | 30.9.21 |
£ | £ |
Within one year |
Between one and five years |
18. | PROVISIONS FOR LIABILITIES |
30.9.21 |
£ |
Deferred tax | 321,078 |
Blends Flavours & Colours Limited (Registered number: 10670248) |
Notes to the Financial Statements - continued |
for the Year Ended 30 September 2022 |
18. | PROVISIONS FOR LIABILITIES - continued |
Deferred |
tax |
£ |
Balance at 1 October 2021 |
Credit to Income Statement during year | ( |
) |
Balance at 30 September 2022 | ( |
) |
19. | CALLED UP SHARE CAPITAL |
Allotted, issued and fully paid: |
Number: | Class: | Nominal | 30.9.22 | 30.9.21 |
value: | £ | £ |
Ordinary F shares | 10p | 50 | 50 |
Ordinary J shares | 10p | - | - |
Ordinary K shares | 10p | - | - |
50 | 50 |
There are no restrictions on these shares. |
20. | RESERVES |
Retained | Revaluation |
earnings | reserve | Totals |
£ | £ | £ |
At 1 October 2021 | ( |
) | 902,319 |
Deficit for the year | ( |
) | ( |
) |
Dividends | ( |
) | ( |
) |
At 30 September 2022 | ( |
) | 432,118 |
21. | PENSION COMMITMENTS |
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. The charge to the profit and loss was £48,483 (2021: £36,156). |
22. | DIRECTORS' ADVANCES, CREDITS AND GUARANTEES |
The following advances and credits to directors subsisted during the years ended 30 September 2022 and 30 September 2021: |
30.9.22 | 30.9.21 |
£ | £ |
Balance outstanding at start of year | ( |
) | ( |
) |
Amounts repaid | ( |
) | ( |
) |
Amounts written off | - | - |
Amounts waived | - | - |
Balance outstanding at end of year | ( |
) | ( |
) |
Blends Flavours & Colours Limited (Registered number: 10670248) |
Notes to the Financial Statements - continued |
for the Year Ended 30 September 2022 |
22. | DIRECTORS' ADVANCES, CREDITS AND GUARANTEES - continued |
Balance outstanding at start of year | ( |
) |
Amounts advanced |
Amounts repaid | ( |
) | ( |
) |
Amounts written off | - | - |
Amounts waived | - | - |
Balance outstanding at end of year |
Balance outstanding at start of year | ( |
) |
Amounts advanced |
Amounts repaid | ( |
) | ( |
) |
Amounts written off | - | - |
Amounts waived | - | - |
Balance outstanding at end of year |
Loans incur interest at 2% per anum. |
23. | ULTIMATE CONTROLLING PARTY |
The ultimate controlling party is Mrs A Rowark and Mr M D Rowark by virtue of their majority shareholding in the company. |