Company registration number 12374548 (England and Wales)
CAMBRIAN LONDON LIMITED
Annual report and financial statements
For the year ended 31 May 2022
CAMBRIAN LONDON LIMITED
COMPANY INFORMATION
Directors
Mr A Morris
Mr M Applebee
Secretary
WSM Services Limited
Company number
12374548
Registered office
Connect House
133-137 Alexandra Road
London
SW19 7JY
Auditor
WSM Advisors Limited
Connect House
133-137 Alexandra Road
London
SW19 7JY
CAMBRIAN LONDON LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2
Directors' responsibilities statement
3
Independent auditor's report
4 - 6
Profit and loss account
7
Group statement of comprehensive income
8
Group balance sheet
9
Company balance sheet
10
Group statement of changes in equity
11
Company statement of changes in equity
12
Group statement of cash flows
13
Company statement of cash flows
14
Notes to the financial statements
15 - 27
CAMBRIAN LONDON LIMITED
STRATEGIC REPORT
For the year ended 31 May 2022
- 1 -
The directors present the
ir
strategic report for the year ended 31 May 2022.
Fair review of the business
The directors are pleased to report that the group consolidated turnover is consistent with that achieved in the prior year.
The underlying gross profit margin is 28.7% (2021: 24.6%) driven by greater efficiency within the business.
During the next year the directors aim to consolidate their sales position by adding and developing new lines to the product mix and by continuing their investment in the business. They also continue to aim to increase the geographical area of distribution of the company.
Principal risks and uncertainties
The principal risks and uncertainties for the group are aligned with those of the underlying trading company.
Cash flow risk - The company's activities expose it primarily to the risk of customer bad debt. The company has customer credit record check procedures in place to minimise its exposure to potential bad debts and regular checks are carried out on balances to ensure action is taken at the earliest opportunity.
Liquidity risk - To maintain liquidity the company uses a mixture of long and short term debt finance. The company has benefited from low interest rates, which have allowed it to decrease long term debt reducing exposure to future changes to interest rates.
Price risk - The company is exposed to a very competitive marketplace and maintaining gross profit margins has been challenging. The company is continuing to identify new products to add to the product mix and is committed to increasing margins.
Mr M Applebee
Director
21 September 2022
CAMBRIAN LONDON LIMITED
DIRECTORS' REPORT
For the year ended 31 May 2022
- 2 -
The directors present their annual report and financial statements for the year ended 31 May 2022.
Principal activities
The principal activity of the company is as a holding company for Raven Roofing and Building Supplies Limited which buys and selling roofing materials to both trade customers and the general public.
Results and dividends
The results for the year are set out on page 7.
Ordinary dividends were paid amounting to £590,000. The directors do not recommend payment of a further dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Mr A Morris
Mr M Applebee
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 auditor
of the
company 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 auditor
of the
company
is
aware of that information.
On behalf of the board
Mr M Applebee
Director
21 September 2022
CAMBRIAN LONDON LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
For the year ended 31 May 2022
- 3 -
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 group and company, and of the profit or loss of the group 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;
-
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the
;
-
prepare the
on the going concern basis unless it is inappropriate to presume that the
group and
company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
CAMBRIAN LONDON LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF CAMBRIAN LONDON LIMITED
- 4 -
Opinion
We have audited the
financial statements of
Cambrian London Limited
(the 'parent company') and its subsidiaries (the 'group') for the year ended 31 May 2022 which comprise the group profit and loss account, the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows, the company 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 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 group's and the parent company's affairs as at 31 May 2022 and of the group's 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
group and
parent 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
group's and
parent
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.
CAMBRIAN LONDON LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF CAMBRIAN LONDON LIMITED
- 5 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the
group and the parent
company and
their
environment obtained in the course of the audit, we have not identifie
d
material misstatements in the strategic report or the directors'
r
eport
.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
-
adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or
-
the parent company 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 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
parent
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 parent 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
.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below
.
Our tests included agreeing the financial statement disclosures to underlying supporting documentation where relevant, enquiries with management as to the risks of non-compliance and any instances thereof, challenging assumptions and judgments made by management, and identifying and testing journal entries, in particular any journal entries posted with unusual account combinations. Our audit procedures also focused on laws and regulations that could give rise to a material misstatement in the financial statements, including, but not limited to, the Companies Act 2006.
Our audit procedures were designed to respond to risks of material misstatement in the financial statements, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery, misrepresentations or through collusion. There are inherent limitations in the audit procedures performed and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we are to become aware of it.
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.
CAMBRIAN LONDON LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF CAMBRIAN LONDON LIMITED
- 6 -
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 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 members as a body, for our audit work, for this report, or for the opinions we have formed.
Wendy Patterson (Senior Statutory Auditor)
For and on behalf of WSM Advisors Limited
21 September 2022
Chartered Accountants
Statutory Auditor
Connect House
133-137 Alexandra Road
Wimbledon
London
SW19 7JY
CAMBRIAN LONDON LIMITED
GROUP PROFIT AND LOSS ACCOUNT
For the year ended 31 May 2022
- 7 -
2022
2021
Notes
£
£
Turnover
3
19,572,498
19,667,047
Cost of sales
(13,956,874)
(14,812,974)
Gross profit
5,615,624
4,854,073
Selling and distribution costs
(626,018)
(647,639)
Administrative expenses
(3,012,726)
(3,107,336)
Other operating income
-
107,083
Operating profit
4
1,976,880
1,206,181
Interest receivable and similar income
8
77
134
Interest payable and similar expenses
9
(19,184)
(24,557)
Profit before taxation
1,957,773
1,181,758
Tax on profit
10
(374,363)
(233,113)
Profit for the financial year
1,583,410
948,645
Profit for the financial year is all attributable to the owners of the parent company.
CAMBRIAN LONDON LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
For the year ended 31 May 2022
- 8 -
2022
2021
£
£
Profit for the year
1,583,410
948,645
Other comprehensive income
-
-
Total comprehensive income for the year
1,583,410
948,645
Total comprehensive income for the year is all attributable to the owners of the parent company.
CAMBRIAN LONDON LIMITED
GROUP BALANCE SHEET
As at 31 May 2022
- 9 -
2022
2021
as restated
Notes
£
£
£
£
Fixed assets
Tangible assets
12
79,726
81,037
Investments
13
1,300
1,300
81,026
82,337
Current assets
Stocks
15
1,673,311
1,494,213
Debtors
16
3,014,638
3,341,205
Cash at bank and in hand
2,290,087
717,603
6,978,036
5,553,021
Creditors: amounts falling due within one year
17
(4,712,739)
(4,285,210)
Net current assets
2,265,297
1,267,811
Total assets less current liabilities
2,346,323
1,350,148
Provisions for liabilities
Deferred tax liability
18
3,793
1,028
(3,793)
(1,028)
Net assets
2,342,530
1,349,120
Capital and reserves
Called up share capital
20
2,000
2,000
Profit and loss reserves
2,340,530
1,347,120
Total equity
2,342,530
1,349,120
The financial statements were approved by the board of directors and authorised for issue on 21 September 2022 and are signed on its behalf by:
21 September 2022
Mr A Morris
Director
CAMBRIAN LONDON LIMITED
COMPANY BALANCE SHEET
As at 31 May 2022
31 May 2022
- 10 -
2022
2021
Notes
£
£
£
£
Fixed assets
Investments
13
1,000
1,000
Current assets
Debtors
16
376,292
Cash at bank and in hand
386,804
192,753
763,096
192,753
Creditors: amounts falling due within one year
17
(457,806)
(162,846)
Net current assets
305,290
29,907
Net assets
306,290
30,907
Capital and reserves
Called up share capital
20
2,000
2,000
Profit and loss reserves
304,290
28,907
Total equity
306,290
30,907
As permitted by s408 Companies Act 2006, the
c
ompany has not presented its own profit and loss account and related notes. The
c
ompany’s profit for the
period
was £865,383
.
The financial statements were approved by the board of directors and authorised for issue on 21 September 2022 and are signed on its behalf by:
21 September 2022
Mr A Morris
Director
Company Registration No. 12374548
CAMBRIAN LONDON LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
For the year ended 31 May 2022
- 11 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 June 2020
2,000
759,475
761,475
Period ended 31 May 2021:
Profit and total comprehensive income for the period
-
948,645
948,645
Dividends
11
-
(361,000)
(361,000)
Balance at 31 May 2021
2,000
1,347,120
1,349,120
Year ended 31 May 2022:
Profit and total comprehensive income for the year
-
1,583,410
1,583,410
Dividends
11
-
(590,000)
(590,000)
Balance at 31 May 2022
2,000
2,340,530
2,342,530
CAMBRIAN LONDON LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
For the year ended 31 May 2022
- 12 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at date of incorporation
2,000
-
2,000
Period ended 31 May 2021:
Profit and total comprehensive income for the period
-
389,907
389,907
Dividends
11
-
(361,000)
(361,000)
Balance at 31 May 2021
2,000
28,907
30,907
Year ended 31 May 2022:
Profit and total comprehensive income for the year
-
865,383
865,383
Dividends
11
-
(590,000)
(590,000)
Balance at 31 May 2022
2,000
304,290
306,290
CAMBRIAN LONDON LIMITED
GROUP STATEMENT OF CASH FLOWS
For the year ended 31 May 2022
- 13 -
2022
2021
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
23
2,426,398
1,679,845
Interest paid
(19,184)
(24,557)
Income taxes paid
(206,573)
(99)
Net cash inflow from operating activities
2,200,641
1,655,189
Investing activities
Purchase of tangible fixed assets
(38,234)
(4,421)
Receipts arising from loans made
-
5,460
Interest received
77
134
Net cash (used in)/generated from investing activities
(38,157)
1,173
Financing activities
Dividends paid to equity shareholders
(590,000)
(361,000)
Net cash used in financing activities
(590,000)
(361,000)
Net increase in cash and cash equivalents
1,572,484
1,295,362
Cash and cash equivalents at beginning of year
717,603
(577,759)
Cash and cash equivalents at end of year
2,290,087
717,603
CAMBRIAN LONDON LIMITED
COMPANY STATEMENT OF CASH FLOWS
For the year ended 31 May 2022
- 14 -
2022
2021
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
24
875,574
552,753
Interest paid
(63)
Income taxes paid
(91,460)
Net cash inflow from operating activities
784,051
552,753
Investing activities
Repayment of loans
1,000
Net cash generated from investing activities
-
1,000
Financing activities
Dividends paid to equity shareholders
(590,000)
(361,000)
Net cash used in financing activities
(590,000)
(361,000)
Net increase in cash and cash equivalents
194,051
192,753
Cash and cash equivalents at beginning of year
192,753
Cash and cash equivalents at end of year
386,804
192,753
CAMBRIAN LONDON LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS
For the year ended 31 May 2022
- 15 -
1
Accounting policies
Company information
Cambrian London Limited (“the company”)
is a
private
limited company domiciled and incorporated in
England and Wales
.
The registered office is
Connect House, 133-137 Alexandra Road, London, SW19 7JY.
The group consists of Cambrian London Limited and its subsidiary Raven Roofing and Building Supplies Limited.
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 £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
1.2
Business combinations
The Company acquired its holding in Raven Roofing and Building Supplies Limited via a share-for-share exchange on the 17 July 2020.
The m
erger accounting method
was used whereby
the carrying values of the assets and liabilities of the combination
ha
d
not
been
adjusted to fair value
.
There was no
difference
between
the nominal value of the shares
and
the nominal value of the shares received in exchange
. As a result there is no
movement on other reserves
presented
in the consolidated financial statements.
Merger expenses were not included as part of this adjustment, but were
instead
charged to the statement of comprehensive income as part of profit or loss of the combined entity at the effective date of the group reconstruction.
1.3
Going concern
At the time of approving the financial statements, the directors have a reasonable expectation that the
group
has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.4
Revenue
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
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.
Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that
it is probable will be
recover
ed
.
CAMBRIAN LONDON LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
For the year ended 31 May 2022
1
Accounting policies
(Continued)
- 16 -
1.5
Property, plant and equipment
Tangible fixed assets
are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Freehold land and buildings
10% on cost
Plant and equipment
15% on cost
Fixtures and fittings
15% on cost
Computers
15% on cost
Motor vehicles
20% on cost
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the
profit and loss account
.
1.6
Inventories
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.
1.7
Cash and cash equivalents
Cash and cash equivalents
are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.8
Financial instruments
The group 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 group's
balance sheet
when the group becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and 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
m
ethod 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.
CAMBRIAN LONDON LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
For the year ended 31 May 2022
1
Accounting policies
(Continued)
- 17 -
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 unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future
paymen
ts discounted at a market rate of interest.
Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. 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.
1.9
Equity instruments
Equity instruments issued by the group 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 group.
1.10
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the
profit and loss account
because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The
group’s
liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the
profit and loss account
, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset
if, and only if, there is
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.
1.11
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.
CAMBRIAN LONDON LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
For the year ended 31 May 2022
1
Accounting policies
(Continued)
- 18 -
1.12
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.13
Leases
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
d
asset are consumed.
1.14
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.
1.15
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 group’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.
3
Turnover and other revenue
2022
2021
£
£
Turnover analysed by class of business
Roofing materials
19,572,498
19,667,047
2022
2021
£
£
Turnover analysed by geographical market
United Kingdom
19,572,498
19,667,047
CAMBRIAN LONDON LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
For the year ended 31 May 2022
3
Turnover and other revenue
(Continued)
- 19 -
2022
2021
£
£
Other revenue
Interest income
77
134
Grants received
107,083
4
Operating profit
2022
2021
£
£
Operating profit for the year is stated after charging/(crediting):
Government grants
(107,083)
Depreciation of owned tangible fixed assets
39,545
54,992
Operating lease charges
624,580
775,814
5
Auditor's remuneration
2022
2021
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
1,375
1,250
Audit of the financial statements of the company's subsidiaries
14,745
13,275
16,120
14,525
6
Employees
The average monthly number of persons (including directors) employed by the group and company during the year was:
Group
Company
2022
2021
2022
2021
Number
Number
Number
Number
48
52
4
4
CAMBRIAN LONDON LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
For the year ended 31 May 2022
6
Employees
(Continued)
- 20 -
Their aggregate remuneration comprised:
Group
Company
2022
2021
2022
2021
£
£
£
£
Wages and salaries
1,748,143
1,589,885
182,265
180,000
Social security costs
183,061
162,512
23,465
22,412
Pension costs
144,790
213,357
86,666
160,000
2,075,994
1,965,754
292,396
362,412
7
Directors' remuneration
2022
2021
£
£
Remuneration for qualifying services
2,265
-
Company pension contributions to defined contribution schemes
6,667
80,000
8,932
80,000
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 2 (2021 - 2).
8
Interest receivable and similar income
2022
2021
£
£
Interest income
Interest on bank deposits
77
134
Investment income includes the following:
Interest on financial assets not measured at fair value through profit or loss
77
134
9
Interest payable and similar expenses
2022
2021
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
19,121
24,557
Other finance costs:
Other interest
63
-
Total finance costs
19,184
24,557
CAMBRIAN LONDON LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
For the year ended 31 May 2022
- 21 -
10
Taxation
2022
2021
£
£
Current tax
UK corporation tax on profits for the current period
371,598
209,579
Adjustments in respect of prior periods
3,063
Total current tax
371,598
212,642
Deferred tax
Origination and reversal of timing differences
2,765
20,471
Total tax charge
374,363
233,113
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:
2022
2021
£
£
Profit before taxation
1,957,773
1,181,758
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2021: 19.00%)
371,978
224,534
Tax effect of expenses that are not deductible in determining taxable profit
2,403
5,317
Tax effect of utilisation of tax losses not previously recognised
(15)
(28,933)
Adjustments in respect of financial assets
(2,768)
8,660
Under/(over) provided in prior years
3,064
Movement in deferred tax
2,765
20,471
Taxation charge
374,363
233,113
11
Dividends
2022
2021
Recognised as distributions to equity holders:
£
£
Final paid
590,000
361,000
CAMBRIAN LONDON LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
For the year ended 31 May 2022
- 22 -
12
Tangible fixed assets
Group
Freehold land and buildings
Plant and equipment
Fixtures and fittings
Computers
Motor vehicles
Total
£
£
£
£
£
£
Cost
At 1 June 2021
200,919
85,939
181,049
161,111
126,725
755,743
Additions
25,493
4,645
8,096
38,234
At 31 May 2022
200,919
111,432
185,694
169,207
126,725
793,977
Depreciation and impairment
At 1 June 2021
196,449
77,366
145,268
129,222
126,401
674,706
Depreciation charged in the year
4,470
5,436
14,709
14,606
324
39,545
At 31 May 2022
200,919
82,802
159,977
143,828
126,725
714,251
Carrying amount
At 31 May 2022
28,630
25,717
25,379
79,726
At 31 May 2021
4,470
8,573
35,781
31,889
324
81,037
The company had no tangible fixed assets at 31 May 2022 or 31 May 2021.
13
Fixed asset investments
Group
Company
2022
2021
2022
2021
Notes
£
£
£
£
Investments in subsidiaries
14
1,000
1,000
Unlisted investments
1,300
1,300
1,300
1,300
1,000
1,000
Movements in fixed asset investments
Group
Investments
£
Cost or valuation
At 1 June 2021 and 31 May 2022
1,300
Carrying amount
At 31 May 2022
1,300
At 31 May 2021
1,300
CAMBRIAN LONDON LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
For the year ended 31 May 2022
13
Fixed asset investments
(Continued)
- 23 -
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 June 2021 and 31 May 2022
1,000
Carrying amount
At 31 May 2022
1,000
At 31 May 2021
1,000
14
Subsidiaries
Details of the company's subsidiaries at 31 May 2022 are as follows:
Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Raven Roofing and Building Supplies Limited
Applemor House Head Office, Campbell Road, Twickenham, TW2 5BY
Ordinary
100.00
15
Stocks
Group
Company
2022
2021
2022
2021
£
£
£
£
Raw materials and consumables
1,673,311
1,494,213
16
Debtors
Group
Company
2022
2021
2022
2021
Amounts falling due within one year:
£
£
£
£
Trade debtors
2,233,107
2,471,207
Amounts owed by group undertakings
-
8,333
375,667
-
Other debtors
647,693
756,085
Prepayments and accrued income
133,838
105,580
625
3,014,638
3,341,205
376,292
-
CAMBRIAN LONDON LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
For the year ended 31 May 2022
- 24 -
17
Creditors: amounts falling due within one year
Group
Company
2022
2021
2022
2021
£
£
£
£
Trade creditors
3,475,003
3,456,361
Amounts owed to group undertakings
8,333
8,333
Corporation tax payable
374,604
209,579
202,991
91,459
Other taxation and social security
424,723
339,788
88,835
52,625
Other creditors
239,585
69,651
158,285
Accruals and deferred income
198,824
201,498
7,695
10,429
4,712,739
4,285,210
457,806
162,846
18
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the group and company, and movements thereon:
Liabilities
Liabilities
2022
2021
Group
£
£
Accelerated capital allowances
3,793
1,028
The company has no deferred tax assets or liabilities.
Group
Company
2022
2022
Movements in the year:
£
£
Liability at 1 June 2021
1,028
-
Charge to profit or loss
2,765
-
Liability at 31 May 2022
3,793
-
T
he deferred tax liability
set out above
is expected to reverse within 12 month
s
and relates to accelerated capital allowances that are expected to mature within the same period.
19
Retirement benefit schemes
2022
2021
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
144,790
213,357
CAMBRIAN LONDON LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
For the year ended 31 May 2022
19
Retirement benefit schemes
(Continued)
- 25 -
A
defined contribution pension scheme
is operated
for all qualifying employees.
The assets of the scheme are held separately from those of the group in an independently administered fund.
20
Share capital
Group and company
2022
2021
2022
2021
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
2,000
2,000
2,000
2,000
21
Operating lease commitments
Lessee
At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
Group
Company
2022
2021
2022
2021
£
£
£
£
Within one year
411,894
369,171
-
-
Between two and five years
913,084
1,004,764
-
-
In over five years
24,658
72,125
-
-
1,349,636
1,446,060
-
-
22
Related party transactions
a. Entity with common directors
During the year the subsidiary paid rents, excluding VAT, to to an entity with common directors of £70,380 (2021: £70,380).
b. Administrative services
During the year £Nil (2021: £4,000) was paid by the subsidiary to a company which is associated with a director of the subsidiary. This company also provided additional support in administrative and secretarial services.
c. Site rental
During the year £27,600 (2021 £34,500) was paid by the subsidiary to close family members of two of the directors (of both the parent and subsidiary
)
as rent for use of one of the branch sites which they own.
During the year £27,600 (2021: £20,700) was paid by the subsidiary to two of the directors (of both the parent and subsidiary) as rent for use of one of the branch sites which they own.
d. Related employees
During the year £283,197 (2021: £282,413) was paid to close family members of the directors as salaries for work they completed from the parent company.
CAMBRIAN LONDON LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
For the year ended 31 May 2022
- 26 -
23
Cash generated from group operations
2022
2021
£
£
Profit for the year after tax
1,583,410
948,645
Adjustments for:
Taxation charged
374,363
233,113
Finance costs
19,184
24,557
Investment income
(77)
(134)
Depreciation and impairment of tangible fixed assets
39,545
54,992
Movements in working capital:
Increase in stocks
(179,098)
(92,582)
Decrease/(increase) in debtors
326,567
(839,252)
Increase in creditors
262,504
1,350,506
Cash generated from operations
2,426,398
1,679,845
24
Cash generated from operations - company
2022
2021
£
£
Profit for the year after tax
865,383
389,907
Adjustments for:
Taxation charged
202,992
91,459
Finance costs
63
Movements in working capital:
Increase in debtors
(376,292)
-
Increase in creditors
183,428
71,387
Cash generated from operations
875,574
552,753
25
Analysis of changes in net funds - group
1 June 2021
Cash flows
31 May 2022
£
£
£
Cash at bank and in hand
717,603
1,572,484
2,290,087
26
Analysis of changes in net funds - company
1 June 2021
Cash flows
31 May 2022
£
£
£
Cash at bank and in hand
192,753
194,051
386,804
CAMBRIAN LONDON LIMITED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
For the year ended 31 May 2022
- 27 -
27
Prior period adjustment
Within year ended 2022 a presentational adjustment has been processed between stock and creditors to show a fairer representation of the financial position.
A presentational restatement to the prior period has therefore also been processed to retain comparability of the accounts. There is no impact on either the prior period profit and loss account or statement of changes in equity as a result of this adjustment.
Changes to the balance sheet - group
As previously reported
Adjustment
As restated at 31 May 2021
£
£
£
Current assets
Stocks
1,202,650
291,563
1,494,213
Creditors due within one year
Other creditors
(3,444,280)
(291,563)
(3,735,843)
Net assets
1,349,120
-
1,349,120
Capital and reserves
Total equity
1,349,120
-
1,349,120
2022-05-31
2021-06-01
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