Company Registration No. 02929703 (England and Wales)
A & G Precision And Sons Limited
Annual Report and Financial Statements
For the Year Ended
28 February 2022
A & G PRECISION AND SONS LIMITED
A & G Precision And Sons Limited
COMPANY INFORMATION
Directors
Mr A Pinder
Mrs J Pinder
Mr S Pinder
Mr M Pinder
Mr J Pinder
Mr W Richardson
Mrs N L Halverson
Secretary
Mrs J Pinder
Company number
02929703
Registered office
Floor 1, Capital House
8 Pittman Court, Pittman Way
Fulwood
Preston
United Kingdom
PR2 9ZG
Auditor
Azets Audit Services
Floor 1, Capital House
8 Pittman Court, Pittman Way
Fulwood
Preston
United Kingdom
PR2 9ZG
Bankers
NatWest - Preston
35 Fishergate
Preston
Lancashire
United Kingdom
PR1 2AD
A & G PRECISION AND SONS LIMITED
A & G Precision And Sons Limited
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditor's report
5 - 7
Statement of comprehensive income
8
Balance sheet
9
Statement of changes in equity
10
Statement of cash flows
11
Notes to the financial statements
12 - 24
A & G PRECISION AND SONS LIMITED
A & G Precision And Sons Limited
STRATEGIC REPORT
FOR THE YEAR ENDED 28 FEBRUARY 2022
- 1 -
The directors present the strategic report for the year ended 28 February 2022.
Fair review of the business
The principal activity of the company continued to be that of providing manufacturing solutions to a wide range of markets.
During the
year
the company
achieved turnover of £5,875,989 (2021: £6,433,700) and made
a profit
before tax of £
971,685
(20
21
:
£
1,284,158
)
.
The Balance Sheet shows a strong net current asset position of £2,188,985 (2021: £2,036,868) at the year end. The excess of profit above dividends paid resulted in an increase in shareholders funds of £714,042. Capital expenditure amounted to £667,331 in the year and mainly related to plant and machinery.
The directors are pleased with the overall results and credit must be given to all employees for their efforts.
Position at the end of the year
The company has cash reserves of £2,219,214 at the end of the year with current liabilities of £1,549,996. The company has a net current assets ratio of 2.41 compared to 2.33 in the prior year.
Key financial performance indicators
The directors regard the key financial indicators for the company as those that communicate the financial performance and strength of the company, being:
Principal risks and uncertainties
The board regularly reviews the business risks and uncertainties facing the company and takes the appropriate action.
Set out below are the principal risk factors relation to the company's business, along with procedures to mitigate these risks and uncertainties.
Competition risk
The industry in which the company operates is highly competitive. As a result, the company has to price its services competitively in order to win tenders. However, developing new and existing processes, along with other measures, have enabled the company to maintain its gross margin in recent years.
Health and safety risk
The company is in a regulated industry where the maintenance of health and safety and environmental standards are absolutely crucial. The company recognises its obligations and the risk to its reputation of any incident affecting either its customers or employees. The directors are mindful of their responsibilities and comply with all relevant legislation.
COVID-19
The directors have implemented both elevated health measures, including temperature checking and additional cleaning regimes, to ensure the safety of our people.
All employees classified as vulnerable, or with a vulnerable family member, were identified early on and special measures put in place to support and safeguard them. As you would expect we have adopted all government and public health authority guidelines. We have also put additional measures in place to support the health and wellbeing of all our employees in these uncertain times.
A & G PRECISION AND SONS LIMITED
A & G Precision And Sons Limited
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2022
- 2 -
Financial instruments and liquidity risk
The company has several financial instruments which provide a financial base. These comprise trade debtors, trade creditors, hire purchase agreements and bank loans. Their existence exposes the company to a number of financial risks, which the company seeks to manage and limit the potential adverse effects. These policies remain unchanged from previous years. The company also seeks to mitigate financial risk by ensuring sufficient liquidity is available to meet foreseeable needs.
Interest rate risk
The company has borrowings and is therefore at risk from interest rate rises. However, the profits of the company adequately cover the interest charges and it is felt that there is enough headroom for the company to manage any increase in interest charges.
Credit risk
To be commercial, the company must allow its customers to trade with credit terms and hence the company is exposed to the associated risks. The company mitigates these risks by carrying out credit checks on new customers and has a dedicated credit control department to monitor amounts outstanding from existing customers. Bad debts are minimal in the year.
Liquidity risk
The liquidity risk of the company is considered to be low because the company has a healthy balance sheet position at the year end and strong cash flow.
Mrs J Pinder
Secretary
28 November 2022
A & G PRECISION AND SONS LIMITED
A & G Precision And Sons Limited
DIRECTORS' REPORT
FOR THE YEAR ENDED 28 FEBRUARY 2022
- 3 -
The directors present their annual report and financial statements for the year ended 28 February 2022.
Results and dividends
The results for the year are set out on page 8.
Ordinary dividends were paid amounting to £101,400. 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 Pinder
Mrs J Pinder
Mr S Pinder
Mr M Pinder
Mr J Pinder
Mr W Richardson
Mrs N L Halverson
Research and development
The research and development activities of
company
are concentrated on the development of new
processes
and
increased investment in plant and machinery.
Future developments
The company intends to keep its innovative and competitive edge by
improving manufacturing processes.
The directors consider that the company has performed well over the
year
and are confident that the company will continue to develop and grow despite the high competition within the industry.
Auditor
Azets Audit Services were appointed as auditor to the company and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.
Statement of directors' responsibilities
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
-
select suitable accounting policies and then apply them consistently;
-
make judgements and accounting estimates that are reasonable and prudent;
-
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
A & G PRECISION AND SONS LIMITED
A & G Precision And Sons Limited
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2022
- 4 -
Strategic report
The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of
:
-Financial risk management objectives and policies
-Information on exposure to credit risk and liquidity risk
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s
auditor
is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s
auditor
is aware of that information.
By order of the board
Mrs J Pinder
Secretary
28 November 2022
A & G PRECISION AND SONS LIMITED
A & G Precision And Sons Limited
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF A & G PRECISION AND SONS LIMITED
- 5 -
We have audited the financial statements of A & G Precision and Sons Limited (the 'company') for the year ended 28 February 2022 which comprise the statement of comprehensive income, the balance sheet, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including significant accounting policies.
The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102
The Financial Reporting Standard applicable in the UK and Republic of Ireland
(United Kingdom Generally Accepted Accounting Practice).
In our opinion, except for the effects of the matter described in the Basis for Qualified Opinion paragraph, the financial statements:
-
give a true and fair view of the state of the company's affairs as at 28 February 2022 and of its profit for the year then ended;
-
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
-
have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for qualified opinion
The evidence available to us was limited because we were not appointed as auditor of the company until after the preceding year end and in consequence it was not possible for us to perform the auditing procedures necessary to obtain sufficient appropriate audit evidence as regards inventory included in the preceding years' financial statements at £289,400. Any adjustments to inventory would have a consequential effect on the profit for the period ended 28 February 2022.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the
Auditor's
responsibilities for the audit of the
financial statements
section of our report. We are independent of the
company
in accordance with the ethical requirements that are relevant to our audit of the
financial statements
in the UK, including the FRC’s Ethical Standard
, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast 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.
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.
A & G PRECISION AND SONS LIMITED
A & G Precision And Sons Limited
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF A & G PRECISION AND SONS LIMITED
- 6 -
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.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identifie
d
material misstatements in the strategic report and the directors'
r
eport
.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
-
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
-
the financial statements are not in agreement with the accounting records and returns; or
-
certain disclosures of
remuneration specified by law are not made; or
-
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors'
r
esponsibilities
s
tatement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of
financial statements
that are free from material misstatement, whether due to fraud or error. In preparing the
financial statements
, the
directors are
responsible for assessing the company
'
s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the
directors
either
intend
to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the
financial statements
as a whole are free from material misstatement, whether due to fraud or error, and to issue an
auditor's
report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with
ISAs (UK)
will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these
financial statements
.
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.
A & G PRECISION AND SONS LIMITED
A & G Precision And Sons Limited
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF A & G PRECISION AND SONS LIMITED
- 7 -
Extent to which the audit was considered capable of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above and on the Financial Reporting Council’s website, to detect material misstatements in respect of irregularities, including fraud.
We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework. Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.
In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included:
-
Enquiry of management and those charged with governance around actual and potential litigation and claims as well as actual, suspected and alleged fraud;
-
Reviewing minutes of meetings of those charged with governance;
-
Assessing the extent of compliance with the laws and regulations considered to have a direct material effect on the financial statements or the operations of the company through enquiry and inspection;
-
Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations;
-
Performing audit work over the risk of management bias and override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for indicators of potential bias.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
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.
Julie Flintoff BA(Hons) FCA (Senior Statutory Auditor)
For and on behalf of Azets Audit Services
Statutory Auditor
PRESTON
29 November 2022
A & G PRECISION AND SONS LIMITED
A & G Precision And Sons Limited
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 28 FEBRUARY 2022
- 8 -
2022
2021
as restated
Notes
£
£
Turnover
4
5,875,989
6,433,700
Cost of sales
(4,339,741)
(4,564,877)
Gross profit
1,536,248
1,868,823
Administrative expenses
(493,115)
(527,765)
Operating profit
5
1,043,133
1,341,058
Interest receivable and similar income
8
71
Interest payable and similar expenses
9
(71,448)
(56,971)
Profit before taxation
971,685
1,284,158
Tax on profit
10
(156,243)
(247,253)
Profit for the financial year
815,442
1,036,905
The profit and loss account has been prepared on the basis that all operations are continuing operations.
A & G PRECISION AND SONS LIMITED
A & G Precision And Sons Limited
BALANCE SHEET
AS AT
28 FEBRUARY 2022
28 February 2022
- 9 -
2022
2021
Notes
£
£
£
£
Fixed assets
Tangible assets
12
3,055,382
2,884,262
Current assets
Stocks
13
115,452
289,400
Debtors
14
1,404,315
1,546,163
Cash at bank and in hand
2,219,214
1,727,895
3,738,981
3,563,458
Creditors: amounts falling due within one year
15
(1,549,996)
(1,526,590)
Net current assets
2,188,985
2,036,868
Total assets less current liabilities
5,244,367
4,921,130
Creditors: amounts falling due after more than one year
16
(844,307)
(1,391,771)
Provisions for liabilities
Deferred tax liability
19
390,928
234,269
(390,928)
(234,269)
Net assets
4,009,132
3,295,090
Capital and reserves
Called up share capital
21
100
100
Profit and loss reserves
4,009,032
3,294,990
Total equity
4,009,132
3,295,090
The financial statements were approved by the board of directors and authorised for issue on 28 November 2022 and are signed on its behalf by:
Mr A Pinder
Director
Company Registration No. 02929703
A & G PRECISION AND SONS LIMITED
A & G Precision And Sons Limited
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 28 FEBRUARY 2022
- 10 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 March 2020
100
2,369,885
2,369,985
Period ended 28 February 2021:
Profit and total comprehensive income for the period
-
1,036,905
1,036,905
Dividends
11
-
(111,800)
(111,800)
Balance at 28 February 2021
100
3,294,990
3,295,090
Year ended 28 February 2022:
Profit and total comprehensive income for the year
-
815,442
815,442
Dividends
11
-
(101,400)
(101,400)
Balance at 28 February 2022
100
4,009,032
4,009,132
A & G PRECISION AND SONS LIMITED
A & G Precision And Sons Limited
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 28 FEBRUARY 2022
- 11 -
2022
2021
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
25
1,638,482
2,009,732
Interest paid
(71,448)
(56,971)
Income taxes (paid)/refunded
(249,674)
15,667
Net cash inflow from operating activities
1,317,360
1,968,428
Investing activities
Purchase of tangible fixed assets
(667,331)
(100,406)
Proceeds on disposal of tangible fixed assets
4,000
Receipts arising from loans made
(109,870)
(80,927)
Interest received
71
Net cash used in investing activities
(773,201)
(181,262)
Financing activities
Proceeds of new bank loans
400,000
Repayment of bank loans
(107,798)
(19,975)
Proceeds from finance leases
537,642
Payment of finance leases obligations
(381,284)
(265,179)
Dividends paid
(101,400)
(111,800)
Net cash (used in)/generated from financing activities
(52,840)
3,046
Net increase in cash and cash equivalents
491,319
1,790,212
Cash and cash equivalents at beginning of year
1,727,895
(62,317)
Cash and cash equivalents at end of year
2,219,214
1,727,895
A & G PRECISION AND SONS LIMITED
A & G Precision And Sons Limited
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 2022
- 12 -
1
Accounting policies
Company information
A & G Precision and Sons Limited is a
private
company
limited by shares
incorporated in
England and Wales
.
The registered office is
Floor 1, Capital House, 8 Pittman Court, Pittman Way, Fulwood, Preston, United Kingdom, PR2 9ZG.
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
Going concern
A
true
t the time of approving the financial statements
,
t
he directors have a reasonable expectation that the
company
has adequate resources to continue in operational existence for the foreseeable future. Thus
t
he directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
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.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer
(usually on dispatch of the goods)
, the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
1.4
Tangible fixed assets
Tangible fixed assets
are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
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
2% Straight Line
Plant and machinery
10% and 25% Reducing Balance
Fixtures & fittings
15% & 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
.
Freehold land is not depreciated.
A & G PRECISION AND SONS LIMITED
A & G Precision And Sons Limited
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2022
1
Accounting policies
(Continued)
- 13 -
1.5
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.
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.
1.6
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.
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 at bank and in hand
are basic financial assets
and
include deposits held at call with banks
.
1.8
Financial instruments
The company only has financial assets (debtors, cash and bank balances) and liabilities (creditors and accruals) of a kind that quality as basic financial instruments. They are initially recognised at transaction value and subsequently at their settlement value.
1.9
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.
1.10
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
A & G PRECISION AND SONS LIMITED
A & G Precision And Sons Limited
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2022
1
Accounting policies
(Continued)
- 14 -
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
company’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 when the
company
has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.11
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.
1.12
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.13
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair
value at the date of inception and the present value of the minimum lease payments. The related liability is included in the 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.
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.
A & G PRECISION AND SONS LIMITED
A & G Precision And Sons Limited
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2022
- 15 -
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
Critical judgements
The following judgements (apart from those involving estimates) have had the most significant
effect on amounts recognised in the financial statements.
Property, plant and equipment
Tangible fixed assets are depreciated using the straight-line or reducing balance method based on the estimated useful life, taking into account any residual value. The asset’s residual value and useful life are based on company best estimates and are reviewed, and adjusted if required, at each balance sheet date.
3
Prior year adjustment
A prior period adjustment has been reflected to correctly
re
classify
'Administrative expenses' to 'Cost of sales'
. The adjustment has reduced
'Administrative Expenses'
by £
918,876
in the prior year from £
1,446,641
to £
527,765
. The adjustment has increased
'Cost of sales'
by £
918,876
in the prior year from £
3,646,001
to £
4,564,877
. The prior year adjustment did not impact on profit, Balance Sheet or Equity.
4
Turnover and other revenue
2022
2021
£
£
Other significant revenue
Interest income
-
71
5
Operating profit
2022
2021
Operating profit for the year is stated after charging:
£
£
Fees payable to the company's auditor for the audit of the company's financial statements
6,500
Depreciation of owned tangible fixed assets
262,516
301,175
Depreciation of tangible fixed assets held under finance leases
222,665
175,520
Loss on disposal of tangible fixed assets
7,030
Operating lease charges
12,744
11,538
A & G PRECISION AND SONS LIMITED
A & G Precision And Sons Limited
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2022
- 16 -
6
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2022
2021
Number
Number
Administration
23
23
Production
46
52
Total
69
75
Their aggregate remuneration comprised:
2022
2021
£
£
Wages and salaries
1,931,072
1,981,529
Social security costs
170,503
168,038
Pension costs
28,067
24,799
2,129,642
2,174,366
7
Directors' remuneration
2022
2021
£
£
Remuneration for qualifying services
366,036
353,226
Company pension contributions to defined contribution schemes
2,138
368,174
353,226
Remuneration disclosed above includes £84,484 (2021: £81,690) of remuneration and £457 (2021: £Nil) of company defined benefit pension contributions paid to the highest paid director.
8
Interest receivable and similar income
2022
2021
£
£
Interest income
Other interest income
71
A & G PRECISION AND SONS LIMITED
A & G Precision And Sons Limited
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2022
- 17 -
9
Interest payable and similar expenses
2022
2021
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
17,907
15,701
Other finance costs:
Interest on finance leases and hire purchase contracts
53,804
41,007
Other interest
(263)
263
71,448
56,971
10
Taxation
2022
2021
£
£
Current tax
UK corporation tax on profits for the current period
82,386
282,851
Adjustments in respect of prior periods
(82,802)
(125)
Total current tax
(416)
282,726
Deferred tax
Origination and reversal of timing differences
156,659
(35,473)
Total tax charge
156,243
247,253
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
971,685
1,284,158
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2021: 19.00%)
184,620
243,990
Tax effect of expenses that are not deductible in determining taxable profit
2,628
3,440
Research and development tax credit
(60,671)
Under/(over) provided in prior years
(82,802)
(125)
Deferred tax adjustments in respect of prior years
60,619
Difference in tax rates
51,797
Taxation charge for the year
156,243
247,253
A & G PRECISION AND SONS LIMITED
A & G Precision And Sons Limited
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2022
- 18 -
11
Dividends
2022
2021
£
£
Final paid
101,400
111,800
12
Tangible fixed assets
Freehold land and buildings
Plant and machinery
Fixtures & fittings
Total
£
£
£
£
Cost
At 1 March 2021
1,418,772
4,618,536
132,232
6,169,540
Additions
586,521
80,810
667,331
Disposals
(16,125)
(16,125)
At 28 February 2022
1,418,772
5,188,932
213,042
6,820,746
Depreciation and impairment
At 1 March 2021
441,946
2,734,302
109,030
3,285,278
Depreciation charged in the year
16,449
455,840
12,892
485,181
Eliminated in respect of disposals
(5,095)
(5,095)
At 28 February 2022
458,395
3,185,047
121,922
3,765,364
Carrying amount
At 28 February 2022
960,377
2,003,885
91,120
3,055,382
At 28 February 2021
976,826
1,884,234
23,202
2,884,262
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
2022
2021
£
£
Plant and machinery
1,484,877
1,175,538
13
Stocks
2022
2021
£
£
Raw materials and consumables
27,407
188,450
Work in progress
88,045
85,500
Finished goods and goods for resale
15,450
115,452
289,400
A & G PRECISION AND SONS LIMITED
A & G Precision And Sons Limited
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2022
- 19 -
14
Debtors
2022
2021
Amounts falling due within one year:
£
£
Trade debtors
747,350
1,093,256
Corporation tax recoverable
28,309
Other debtors
618,523
440,079
Prepayments and accrued income
10,133
12,828
1,404,315
1,546,163
15
Creditors: amounts falling due within one year
2022
2021
Notes
£
£
Bank loans
18
558,343
44,860
Obligations under finance leases
17
391,395
308,854
Trade creditors
193,957
331,847
Corporation tax
89,209
310,990
Other taxation and social security
224,970
446,762
Other creditors
16,263
Accruals and deferred income
75,859
83,277
1,549,996
1,526,590
Hire purchase creditors of £391,395 (2021: £308,854) are secured against the assets to which the agreement relates.
16
Creditors: amounts falling due after more than one year
2022
2021
Notes
£
£
Bank loans and overdrafts
18
260,000
881,281
Obligations under finance leases
17
584,307
510,490
844,307
1,391,771
Hire purchase creditors of £584,307 (2021: £510,490) are secured against the assets to which the agreement relates.
Amounts included above which fall due after five years are as follows:
Payable by instalments
-
20,000
A & G PRECISION AND SONS LIMITED
A & G Precision And Sons Limited
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2022
- 20 -
17
Finance lease obligations
2022
2021
Future minimum lease payments due under finance leases:
£
£
Within one year
431,697
342,448
In two to five years
634,265
532,857
1,065,962
875,305
Less: future finance charges
(90,260)
(55,961)
975,702
819,344
Finance lease payments represent rentals payable by the company for certain items of plant and machinery. The Company has options to purchase the equipment for a nominal amount at the conclusion of the lease arrangements. The average lease term is 3 to 5 years.
The finance leases are secured by the lessors' title to the leased assets which have a carrying value of £1,484,877 (2021: £1,175,538).
The directors consider that the carrying amount of the obligations under finance leases approximate to their fair value.
A & G PRECISION AND SONS LIMITED
A & G Precision And Sons Limited
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2022
- 21 -
18
Loans and overdrafts
2022
2021
£
£
Bank loans
818,343
926,141
Payable within one year
558,343
44,860
Payable after one year
260,000
881,281
The company has three bank loans from NatWest.
Loan 1
The bank loan of £82,414 (2021: £113,261) is secured by:
A debenture incorporating a fixed and floating charge over all assets of the company.
A first legal charge over property, plant and equipment with a carrying value of £3,055,382.
The bank loan is repayable by monthly instalments over a 5 year period commencing June 2017 with interest at 2.30% above bank base rate.
Loan 2
The bank loan of £395,929 (2021: £412,880) is secured by:
A debenture incorporating a fixed and floating charge over all assets of the company.
A first legal charge over property, plant and equipment with a carrying value of £3,055,382.
The bank loan is repayable by monthly instalments over a 5 year period commencing June 2017 with interest at 2.30% above bank base rate.
Loan 3
The bank loan of £340,000 (2021: £400,000) is repayable by monthly instalments of capital and interest. The final repayment date is 72 months after the loan is taken out. Interest on the loan is charged at 4.75% above bank base rate. The loan was taken out in May 2020 and the company had a capital holiday for the first 13 months. The loan was interest free for the first 12 months.
A & G PRECISION AND SONS LIMITED
A & G Precision And Sons Limited
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2022
- 22 -
19
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2022
2021
Balances:
£
£
Accelerated capital allowances
390,928
234,269
2022
Movements in the year:
£
Liability at 1 March 2021
234,269
Charge to profit or loss
156,659
Liability at 28 February 2022
390,928
All deferred tax liabilities have been recognised at 25% (2021: 19%).
20
Retirement benefit schemes
2022
2021
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
28,067
24,799
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.
21
Share capital
2022
2021
2022
2021
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary of £1 each
100
100
100
100
A & G PRECISION AND SONS LIMITED
A & G Precision And Sons Limited
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2022
- 23 -
22
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2022
2021
£
£
Within one year
6,900
11,558
Between two and five years
6,900
6,900
18,458
23
Related party transactions
During the year the company provided loans to related companies totalling £369,610 (2021: £301,036). The loans are unsecured, interest free, repayable on demand and included within Other Debtors.
During the year the company purchased services from a related company totalling £354,126 (2021: £238,045). A trade creditor was outstanding at the year end of £25,580 (2021: £34,763).
24
Directors' transactions
During the year the company provided interest free unsecured loans to directors which were repayable on demand. The company advanced £179,270 and £69,400 was repaid. No amounts were waived or written off.
25
Cash generated from operations
2022
2021
£
£
Profit for the year after tax
815,442
1,036,905
Adjustments for:
Taxation charged
156,243
247,253
Finance costs
71,448
56,971
Investment income
(71)
Loss on disposal of tangible fixed assets
7,030
Depreciation and impairment of tangible fixed assets
485,181
476,695
Movements in working capital:
Decrease in stocks
173,948
Decrease in debtors
280,027
35,733
(Decrease)/increase in creditors
(350,837)
156,246
Cash generated from operations
1,638,482
2,009,732
A & G PRECISION AND SONS LIMITED
A & G Precision And Sons Limited
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 28 FEBRUARY 2022
- 24 -
26
Analysis of changes in net funds/(debt)
1 March 2021
Cash flows
New finance leases
28 February 2022
£
£
£
£
Cash at bank and in hand
1,727,895
491,319
-
2,219,214
Borrowings excluding overdrafts
(926,141)
107,798
-
(818,343)
Obligations under finance leases
(819,344)
381,284
(537,642)
(975,702)
(17,590)
980,401
(537,642)
425,169
2022-02-28
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false
CCH Software
CCH Accounts Production 2022.300
No description of principal activity
Mr A Pinder
Mr S Pinder
Mr M Pinder
Mr J Pinder
Mr W Richardson
Mrs N L Halverson
Mrs N L Halverson
Mrs J Pinder
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