Company Registration No. SC030651 (Scotland)
MODERN EYEWEAR LIMITED
UNAUDITED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2020
PAGES FOR FILING WITH REGISTRAR
MODERN EYEWEAR LIMITED
CONTENTS
Page
Balance sheet
1 - 2
Notes to the financial statements
3 - 9
MODERN EYEWEAR LIMITED
BALANCE SHEET
AS AT
30 SEPTEMBER 2020
30 September 2020
- 1 -
2020
2019
Notes
£
£
£
£
Fixed assets
Tangible assets
4
291,327
296,868
Investments
5
46,498
100,601
337,825
397,469
Current assets
Stocks
104,909
141,710
Debtors
6
155,207
227,722
Cash at bank and in hand
50,407
1,060
310,523
370,492
Creditors: amounts falling due within one year
7
(210,358)
(346,590)
Net current assets
100,165
23,902
Total assets less current liabilities
437,990
421,371
Creditors: amounts falling due after more than one year
8
(104,307)
(83,973)
Net assets
333,683
337,398
Capital and reserves
Called up share capital
20,000
10,000
Revaluation reserve
9
168,361
168,361
Profit and loss reserves
145,322
159,037
Total equity
333,683
337,398
The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.
true
For the financial year ended 30 September 2020 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.
The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.
T
he members have not required the company to obtain an audit of its financial statements for the year in question in accordance with section 476
.
These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.
MODERN EYEWEAR LIMITED
BALANCE SHEET (CONTINUED)
AS AT
30 SEPTEMBER 2020
30 September 2020
- 2 -
The financial statements were approved by the board of directors and authorised for issue on 11 January 2021 and are signed on its behalf by:
Mrs C Marsh
Mr J A Marsh
Director
Director
Company Registration No. SC030651
MODERN EYEWEAR LIMITED
BALANCE SHEET (CONTINUED)
AS AT 30 SEPTEMBER 2020
30 September 2020
- 3 -
1
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.
2
Accounting policies
Company information
Modern Eyewear Limited is a
private
company
limited by shares
incorporated in Scotland.
The registered office is
Cambus House, 217 Cambuslang Road, Glasgow, G72 7TS.
2.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
The financial statements are prepared in
sterling
, which is the functional currency of the company.
Monetary a
mounts
in these financial statements are
rounded to the nearest £.
The financial statements have been prepared under the historical cost convention, modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.
The company has taken advantage of the exemption under section
399
of the
Companies Act 2006 not to prepare consolidated accounts
, on the basis that the group of which this is the parent qualifies as a small group
. The financial statements present information about the company as an individual entity and not about its group
.
2.2
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business
, and
is shown net of VAT and other sales related taxes
.
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.
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.
MODERN EYEWEAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2020
2
Accounting policies
(Continued)
- 4 -
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
.
2.3
Tangible fixed assets
Tangible fixed assets
are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Freehold property
0%
Property improvements
33.33% straight line
Plant and equipment
20% reducing balance
Motor vehicles
25% reducing balance
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and
is credited or charged to profit or loss
.
2.4
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.
A subsidiary is an entity controlled by the company
. Control is
the power to govern the financial and operating policies of
the
entity so as to obtain benefits from its activities.
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.
Entities in which the company has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities
.
2.5
Impairment of fixed assets
At each reporting
period
end date, the
company
reviews the carrying amounts of its tangible
assets to determine whether there is any indication that those assets have suffered an impairment loss. 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.
MODERN EYEWEAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2020
2
Accounting policies
(Continued)
- 5 -
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.
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.
2.6
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.
2.7
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.
2.8
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset
, with
the net amounts presented in the financial statements
,
when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
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.
MODERN EYEWEAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2020
2
Accounting policies
(Continued)
- 6 -
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.
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. 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.
2.9
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.
2.10
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
2.11
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
2.12
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
s
asset are consumed.
2.13
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.
MODERN EYEWEAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2020
- 7 -
3
Employees
The average monthly number of persons (including directors) employed by the company during the year was 21 (2019 - 22).
2020
2019
Number
Number
Total
21
22
4
Tangible fixed assets
Freehold property
Property improvements
Plant and equipment
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 October 2019
267,000
37,228
265,212
55,000
624,440
Additions
800
800
At 30 September 2020
267,000
37,228
266,012
55,000
625,240
Depreciation and impairment
At 1 October 2019
37,228
239,475
50,869
327,572
Depreciation charged in the year
5,308
1,033
6,341
At 30 September 2020
37,228
244,783
51,902
333,913
Carrying amount
At 30 September 2020
267,000
21,229
3,098
291,327
At 30 September 2019
267,000
25,738
4,130
296,868
The company's heritable property at 217 Cambuslang Road was valued by Emmerson, Chartered Surveyors, on 29 September 2006 on an open market basis at a figure of £230,000 and that valuation has been incorporated into these accounts.
5
Fixed asset investments
2020
2019
£
£
Investments
100
100
Loans
46,398
100,501
46,498
100,601
MODERN EYEWEAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2020
5
Fixed asset investments
(Continued)
- 8 -
Fixed asset investments not carried at market value
It is not considered feasible to establish a fair value for the holding in the company’s 100% owned subsidiary and it is accordingly stated at cost.
Movements in fixed asset investments
Shares in group undertakings
Loans to group undertakings
Total
£
£
£
Cost or valuation
At 1 October 2019
100
100,501
100,601
Repaid
-
(54,103)
(54,103)
At 30 September 2020
100
46,398
46,498
Carrying amount
At 30 September 2020
100
46,398
46,498
At 30 September 2019
100
100,501
100,601
6
Debtors
2020
2019
Amounts falling due within one year:
£
£
Trade debtors
142,416
218,169
Other debtors
12,791
9,553
155,207
227,722
MODERN EYEWEAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 SEPTEMBER 2020
- 9 -
7
Creditors: amounts falling due within one year
2020
2019
£
£
Bank loans and overdrafts
11,500
60,140
Trade creditors
60,915
83,860
Taxation and social security
26,984
31,815
Other creditors
110,959
170,775
210,358
346,590
The bank overdraft is secured by a Bond and Floating Charge over all the assets of the company, subject to a ranking agreement with the debt factors in respect of the company's trade debtors, over which they hold a floating charge.
The bank holds a standard security over both of the company's heritable properties.
8
Creditors: amounts falling due after more than one year
2020
2019
£
£
Bank loans and overdrafts
86,001
58,334
Other creditors
18,306
25,639
104,307
83,973
9
Revaluation reserve
2020
2019
£
£
At the beginning and end of the year
168,361
168,361