Company Registration No. 3000135 (England and Wales)
RALPH COLEMAN INTERNATIONAL LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2020
RALPH COLEMAN INTERNATIONAL LIMITED
COMPANY INFORMATION
Directors
Mr P M Hampton
Mr M P Brown
Mr J P Graves
Company number
3000135
Registered office
Hazell Way
Bermuda Road Industrial Estate
Nuneaton
Warwickshire
United Kingdom
CV10 7PQ
Auditor
Azets Audit Services
2nd Floor
Regis House
45 King William Street
London
United Kingdom
EC4R 9AN
Bankers
Bank of Scotland
124 Collmore Road
Birmingham
United Kingdom
B3 3AU
RALPH COLEMAN INTERNATIONAL LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Directors' responsibilities statement
4
Independent auditor's report
5 - 7
Profit and loss account
8
Statement of comprehensive income
9
Balance sheet
10
Statement of changes in equity
11
Notes to the financial statements
12 - 25
RALPH COLEMAN INTERNATIONAL LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 OCTOBER 2020
- 1 -
The directors present the strategic report for the year ended 31 October 2020.
Fair review of the business
Ralph Coleman International Limited "RCI" is a specialist provider of outsourced supply chain services to providers of returnable transit packaging and retailers.
Following the challenges in the past, the business has made significant progress as revenues increased by 13.8% to £28.3m, as a result of demand on supermarkets during the past 12 months.
Moving forward the Board expects to see continued strong growth across all its activities as the business continues to work with its customers to develop and role out new opportunities and services.
The board have seen continued growth since the year end, despite the impact of the current Covid-19 pandemic, and has taken a range of measures to ensure a safe working environment to both protect our colleagues and ensure minimal disruption to the business as a result of the pandemic.
Principal risks and uncertainties
The company's financial instruments at the balance sheet date comprised of asset finance, and banking facilities. In addition, the company has working capital made up of Stock, Debtors and Creditors that arise directly from its operations.
The main risks from the company's financial instruments are credit risk and liquidity risk. In common with businesses of similar size. these risks are managed by the Board, who set the policies and circumstances for the use of financial instruments and which are monitored and reviewed on an ongoing basis.
The company has no exposure to publicly quoted equity securities as it does hold such financial assets.
Credit Risk
The company's has asset finance which is secured over the assets of the business and is backed by a number of long-term contracts.
The credit risk associated with the asset finance is limited as far as the funded amounts have a fixed interest rate and are repayable over the length of the supporting contracts so reducing the risk of fluctuations in repayments due to economic movements. The principle risk arises therefore from the group being able to meet the repayment terms and manage its cash flow.
The credit risk associated with the companies cash and trade assets is limited by the focus on limited debtors, who have historically had a strong payment history. The directors regularly review the recoverability of its debtors balances.
Liquidity and cash flow risk
Liquidity risk is managed through strong cash flow management and maintaining sufficient cash and overdraft facilities are in place.
Key performance indicators
In monitoring the performance of the business and assessing the risks the company faces, the business utilises a range of financial and non-financial performance indicators to ensure that operational and strategic objectives of the business are met.
Mr J P Graves
Director
17 September 2021
RALPH COLEMAN INTERNATIONAL LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 OCTOBER 2020
- 2 -
The directors present their annual report and financial statements for the year ended 31 October 2020.
Principal activities
The principal activity of the company continued to be a specialist provider of outsourced supply chain services to providers of returnable transit packaging and retailers.
Results and dividends
The results for the year are set out on page 8.
No ordinary dividends were paid. The directors do not recommend payment of a final dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Mr P M Hampton
Mr M P Brown
Mr J P Graves
Disabled persons
Applications for employment by disabled persons are always fully considered, bearing in mind the aptitudes of the applicant concerned. In the event of members of staff becoming disabled, every effort is made to ensure that their employment within the company continues and that the appropriate training is arranged. It is the policy of the company that the training, career development and promotion of disabled persons should, as far as possible, be identical to that of other employees.
Employee involvement
The company's policy is to consult and discuss with employees, through unions, staff councils and at meetings, matters likely to affect employees' interests.
Information about matters of concern to employees is given through information bulletins and reports which seek to achieve a common awareness on the part of all employees of the financial and economic factors affecting the company's performance.
There is no employee share scheme at present, but the directors are considering the introduction of such a scheme as a means of further encouraging the involvement of employees in the company's performance.
Auditor
The auditor, Azets Audit Services, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
On 7 September 2020 Group Audit Services Limited, trading as Wilkins Kennedy Audit Services, changed it's name to Azets Audit Services Limited. The name they practice under is Azets Audit Services and accordingly they have signed their report in their new name.
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.
RALPH COLEMAN INTERNATIONAL LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2020
- 3 -
Disclosure in the Strategic Report
The company has chosen, in accordance with Section 414C of the Companies Act 2006, to set out the following information and would otherwise be required to be contained in the Report of the Directors:
Review of the business;
Financial risk management objectives; and
Indication of exposure to credit risk, liquidity and cash flow risk
On behalf of the board
Mr J P Graves
Director
17 September 2021
RALPH COLEMAN INTERNATIONAL LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 OCTOBER 2020
- 4 -
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
-
select suitable accounting policies and then apply them consistently;
-
make judgements and accounting estimates that are reasonable and prudent;
-
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
RALPH COLEMAN INTERNATIONAL LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF RALPH COLEMAN INTERNATIONAL LIMITED
- 5 -
Opinion
We have audited the financial statements of Ralph Coleman International Limited (the 'company') for the year ended 31 October 2020 which comprise the profit and loss account, the statement of comprehensive income, the balance sheet, the statement of changes in equity and notes to the financial statements, including a summary of significant accounting policies.
The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102
The Financial Reporting Standard applicable in the UK and Republic of Ireland
(United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
-
give a true and fair view of the state of the company's affairs as at 31 October 2020 and of its profit for the year then ended;
-
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
-
have been prepared in accordance with the requirements of the Companies Act 2006.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the
Auditor's
responsibilities for the audit of the financial statements
section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard
, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:
-
the directors' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or
-
the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the company’s ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue
.
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. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. 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.
RALPH COLEMAN INTERNATIONAL LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF RALPH COLEMAN INTERNATIONAL LIMITED
- 6 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identifie
d
material misstatements in the strategic report and the directors'
r
eport
.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
-
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
-
the financial statements are not in agreement with the accounting records and returns; or
-
certain disclosures of 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 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 for the audit of the financial statements is located on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
RALPH COLEMAN INTERNATIONAL LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF RALPH COLEMAN INTERNATIONAL LIMITED
- 7 -
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.
Nicholas Parrett (Senior Statutory Auditor)
for and on behalf of Azets Audit Services
17 September 2021
Statutory Auditor
2nd Floor
Regis House
45 King William Street
London
United Kingdom
EC4R 9AN
RALPH COLEMAN INTERNATIONAL LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 OCTOBER 2020
- 8 -
2020
2019
Notes
£
£
Turnover
3
28,316,173
24,382,871
Cost of sales
(21,287,933)
(19,222,730)
Gross profit
7,028,240
5,160,141
Administrative expenses
(5,286,233)
(3,751,028)
Operating profit
4
1,742,007
1,409,113
Interest payable and similar expenses
8
(514,577)
(531,385)
Profit before taxation
1,227,430
877,728
Tax on profit
9
(218,225)
(201,951)
Profit for the financial year
1,009,205
675,777
The profit and loss account has been prepared on the basis that all operations are continuing operations.
RALPH COLEMAN INTERNATIONAL LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 OCTOBER 2020
- 9 -
2020
2019
£
£
Profit for the year
1,009,205
675,777
Other comprehensive income
-
-
Total comprehensive income for the year
1,009,205
675,777
RALPH COLEMAN INTERNATIONAL LIMITED
BALANCE SHEET
AS AT
31 OCTOBER 2020
31 October 2020
- 10 -
2020
2019
Notes
£
£
£
£
Fixed assets
Tangible assets
11
5,513,798
6,074,444
Current assets
Stocks
12
441,491
261,935
Debtors
13
4,771,992
3,089,354
Cash at bank and in hand
65,095
220,112
5,278,578
3,571,401
Creditors: amounts falling due within one year
14
(6,304,662)
(5,434,714)
Net current liabilities
(1,026,084)
(1,863,313)
Total assets less current liabilities
4,487,714
4,211,131
Creditors: amounts falling due after more than one year
15
(2,832,932)
(3,608,144)
Provisions for liabilities
Deferred tax liability
17
356,916
314,326
(356,916)
(314,326)
Net assets
1,297,866
288,661
Capital and reserves
Called up share capital
19
5,000
5,000
Profit and loss reserves
1,292,866
283,661
Total equity
1,297,866
288,661
The financial statements were approved by the board of directors and authorised for issue on 17 September 2021 and are signed on its behalf by:
Mr J P Graves
Director
Company Registration No. 3000135
RALPH COLEMAN INTERNATIONAL LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 OCTOBER 2020
- 11 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 November 2018
5,000
(392,116)
(387,116)
Year ended 31 October 2019:
Profit and total comprehensive income for the year
-
675,777
675,777
Balance at 31 October 2019
5,000
283,661
288,661
Year ended 31 October 2020:
Profit and total comprehensive income for the year
-
1,009,205
1,009,205
Balance at 31 October 2020
5,000
1,292,866
1,297,866
RALPH COLEMAN INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 OCTOBER 2020
- 12 -
1
Accounting policies
Company information
Ralph Coleman International Limited is a
private
company
limited by shares
incorporated in England and Wales.
The registered office is
Hazell Way, Bermuda Road Industrial Estate, Nuneaton, Warwickshire, United Kingdom, CV10 7PQ.
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, 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.
This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares
publicly available consolidated financial statements
, including this company,
which are
intended to give a true and fair view of the assets, liabilities,
financial position and profit or loss
of the group
.
T
he company has
therefore
taken advantage of
e
xemptions from the following disclosure requirements:
-
Section 4 ‘Statement of Financial Position’: Reconciliation of the opening and closing number of shares;
-
Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
-
Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues’
:
Carrying amounts, interest income/expense and net gains/losses for each category of financial instrument;
basis
of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income
;
-
Section 26 ‘Share based Payment’
:
Share-based payment expense charged to profit or loss, reconciliation of opening and closing number and weighted average exercise price of share options, how the fair value of options granted was measured, measurement and carrying amount of liabilities for cash-settled share-based payments, explanation of modifications to arrangements
;
-
Section 33 ‘Related Party Disclosures’
:
Compensation for key management personnel
.
The financial statements of the company are consolidated in the financial statements of
Premier House Investments Limited
. These consolidated financial statements are available from its registered office
,
is
Hazell Way, Bermuda Road Industrial Estate, Nuneaton, Warwickshire, United Kingdom, CV10 7PQ.
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.
RALPH COLEMAN INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2020
1
Accounting policies
(Continued)
- 13 -
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.
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 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
.
1.4
Intangible fixed assets - goodwill
Goodwill represents the excess of the cost of acquisition of unincorporated businesses over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated
amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 10 years.
For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.
1.5
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:
Leasehold improvements
Straight line over the life of the lease/25% per annum
Plant and equipment
Straight line over 4 years/straight line over 7 years/over the length of contract
Fixtures and fittings
25% from date of acquisition
Tractor and trailer units
15%/25% per annum from date of acquisition
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
.
1.6
Impairment of fixed assets
At each reporting
period
end date, the
company
reviews the carrying amounts of its tangible
and intangible 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.
RALPH COLEMAN INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2020
1
Accounting policies
(Continued)
- 14 -
1.7
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.
Stocks held for distribution at no or nominal consideration are measured at the lower of cost and replacement cost, adjusted where applicable for any loss of service potential.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
1.8
Cash and cash equivalents
Cash and cash equivalents
are basic financial assets
and
include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.9
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's 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.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
RALPH COLEMAN INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2020
1
Accounting policies
(Continued)
- 15 -
Impairment of financial assets
Financial assets, other than those
held
at
fair value through profit and loss
, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected.
If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when
the company
transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans
and
loans from
fellow group companies 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.
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.
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts,
are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are
s
ubsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as
being measured at
fair value th
r
ough profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
RALPH COLEMAN INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2020
1
Accounting policies
(Continued)
- 16 -
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations
expire or are discharged or cancelled.
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
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.
RALPH COLEMAN INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2020
1
Accounting policies
(Continued)
- 17 -
Rentals payable under operating leases,
including
any lease incentives received, are charged to
profit or loss
on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the lease
s
asset are consumed.
1.14
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.
1.15
Share capital
Ordinary shares are classified as equity. Incremental costs attributable to the issue of ordinary shares are recognised as a deduction from equity, net of any tax affects.
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.
RALPH COLEMAN INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2020
2
Judgements and key sources of estimation uncertainty
(Continued)
- 18 -
Key sources of estimation uncertainty
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are
as follows.
Onerous contract
Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that the Company will be required to settle the probable outflow of resources, and a reliable estimate can be made of the amount of the obligation.
Present obligations arising under onerous contracts are recognised and measured as provisions. Onerous contracts are considered to exist where the Company has a contract under which the unavoidable costs of meeting the obligations under the contract exceed the economic benefit expected to be received under the contract. As of 31 October 2019, the provision for onerous contracts amounts to £nil (2018: £418,995) and relates to a rebate contract for which no economic benefits are expected.
Impairment of inventories
The company makes an estimate of the stock obsolescence. When assessing the impairment of inventories, management considers factors including future selling price of stock and expected demand and best before dates of goods for resale.
Useful economic life of tangible assets
The annual depreciation charge for tangible assets is sensitive to changes in the estimated useful economic lives and residual values of the assets. The useful economic lives and residual values are re-assessed annually. They are amended when necessary to reflect our current estimates, based on technological advancement future investments, economic utilisation and the physical condition of the assets.
Impairment of debtors
The company makes an estimate of the recoverable value of its debtors, including inter-company and other debtors. When assessing impairment of debtors, management considers factors including any history of non-payment by the counter-party or any other factors which indicate that they may not be able to settle their obligation to the company in full.
3
Turnover and other revenue
2020
2019
£
£
Turnover analysed by class of business
Sale of goods
28,316,173
24,382,871
2020
2019
£
£
Turnover analysed by geographical market
UK
28,316,173
24,382,871
RALPH COLEMAN INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2020
- 19 -
4
Operating profit
2020
2019
Operating profit for the year is stated after charging/(crediting):
£
£
Exchange differences apart from those arising on financial instruments measured at fair value through profit or loss
1,448
942
Fees payable to the company's auditor for the audit of the company's financial statements
16,500
15,750
Depreciation of owned tangible fixed assets
211,989
235,249
Depreciation of tangible fixed assets held under finance leases
589,977
589,977
(Profit)/loss on disposal of tangible fixed assets
(744)
1,364
Operating lease charges
27,272
23,228
5
Auditor's remuneration
2020
2019
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
16,500
15,750
6
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2020
2019
Number
Number
Management
2
2
Employees
262
262
Total
264
264
Their aggregate remuneration comprised:
2020
2019
£
£
Wages and salaries
6,170,369
5,866,179
Social security costs
595,015
516,499
Pension costs
174,926
133,845
6,940,310
6,516,523
RALPH COLEMAN INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2020
- 20 -
7
Directors' remuneration
2020
2019
£
£
Remuneration for qualifying services
24,000
54,824
8
Interest payable and similar expenses
2020
2019
£
£
Interest on bank overdrafts and loans
532
(727)
Interest payable to group undertakings
373,980
413,265
Interest on finance leases and hire purchase contracts
140,065
118,847
514,577
531,385
9
Taxation
2020
2019
£
£
Current tax
UK corporation tax on profits for the current period
121,476
Adjustments in respect of prior periods
(1,216)
Total current tax
120,260
Deferred tax
Origination and reversal of timing differences
97,965
201,951
Total tax charge
218,225
201,951
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:
2020
2019
£
£
Profit before taxation
1,227,430
877,728
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2019: 19.00%)
233,212
166,768
Tax effect of expenses that are not deductible in determining taxable profit
315
15,785
Tax effect of utilisation of tax losses not previously recognised
(12,839)
(9,811)
Adjustments in respect of prior years
(1,216)
Permanent capital allowances in excess of depreciation
(1,247)
29,209
Taxation charge for the year
218,225
201,951
RALPH COLEMAN INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2020
- 21 -
10
Intangible fixed assets
Goodwill
£
Cost
At 1 November 2019 and 31 October 2020
751
Amortisation and impairment
At 1 November 2019 and 31 October 2020
751
Carrying amount
At 31 October 2020
At 31 October 2019
11
Tangible fixed assets
Leasehold improvements
Plant and equipment
Fixtures and fittings
Tractor and trailer units
Total
£
£
£
£
£
Cost
At 1 November 2019
953,819
6,632,400
309,057
34,000
7,929,276
Additions
124,547
106,649
11,381
242,577
Disposals
(34,000)
(34,000)
At 31 October 2020
1,078,366
6,739,049
320,438
8,137,853
Depreciation and impairment
At 1 November 2019
380,086
1,308,261
133,742
32,743
1,854,832
Depreciation charged in the year
105,782
653,211
42,973
801,966
Eliminated in respect of disposals
(32,743)
(32,743)
At 31 October 2020
485,868
1,961,472
176,715
2,624,055
Carrying amount
At 31 October 2020
592,498
4,777,577
143,723
5,513,798
At 31 October 2019
573,733
5,324,139
175,315
1,257
6,074,444
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
2020
2019
£
£
Plant and equipment
4,437,129
5,027,106
RALPH COLEMAN INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2020
- 22 -
12
Stocks
2020
2019
£
£
Raw materials and consumables
441,491
261,935
13
Debtors
2020
2019
Amounts falling due within one year:
£
£
Trade debtors
2,868,142
2,120,310
Corporation tax recoverable
170,000
Amounts owed by group undertakings
1,093,892
83,595
Other debtors
88,519
204,313
Prepayments and accrued income
721,439
455,761
4,771,992
3,033,979
Deferred tax asset (note 17)
55,375
4,771,992
3,089,354
14
Creditors: amounts falling due within one year
2020
2019
Notes
£
£
Obligations under finance leases
16
775,212
775,214
Trade creditors
2,535,418
2,320,274
Corporation tax
121,476
Other taxation and social security
1,237,245
603,071
Other creditors
1,104,529
1,126,508
Accruals and deferred income
530,782
609,647
6,304,662
5,434,714
15
Creditors: amounts falling due after more than one year
2020
2019
Notes
£
£
Obligations under finance leases
16
2,832,932
3,608,144
RALPH COLEMAN INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2020
- 23 -
16
Finance lease obligations
2020
2019
Future minimum lease payments due under finance leases:
£
£
Within one year
915,244
915,244
In two to five years
3,346,833
3,573,812
In over five years
688,266
4,262,077
5,177,322
Less: future finance charges
(653,933)
(793,964)
3,608,144
4,383,358
Finance lease payments represent rentals payable by the company for certain items of plant and machinery. Leases include purchase options at the end of the lease period, and no restrictions are placed on the use of the assets. The average lease term is 7 years. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.
17
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
Assets
Assets
2020
2019
2020
2019
Balances:
£
£
£
£
Accelerated capital allowances
356,916
314,326
-
-
Tax losses
-
-
-
55,375
356,916
314,326
-
55,375
2020
Movements in the year:
£
Liability at 1 November 2019
258,951
Charge to profit or loss
97,965
Liability at 31 October 2020
356,916
The deferred tax liability set out above is expected to reverse within 12 months and relates to accelerated capital allowances that are expected to mature within the same period.
RALPH COLEMAN INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2020
- 24 -
18
Retirement benefit schemes
2020
2019
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
174,926
133,845
The company operates a defined contribution pension scheme for all qualifying employees.
The assets of the scheme are held separately from those of the company in an independently administered fund.
19
Share capital
2020
2019
2020
2019
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary A of £1 each
1,275
1,275
1,275
1,275
Ordinary B of £1 each
1,275
1,275
1,275
1,275
Ordinary C of £1 each
600
600
600
600
Ordinary D of £1 each
1,500
1,500
1,500
1,500
Ordinary E of £1 each
200
200
200
200
Ordinary F of £1 each
150
150
150
150
5,000
5,000
5,000
5,000
20
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2020
2019
£
£
Within one year
717,400
789,165
Between two and five years
1,597,765
2,079,141
In over five years
60,216
2,315,165
2,928,522
21
Related party transactions
Remuneration of key management personnel
The key management of the company are its directors, their remuneration is disclosed in note 7.
RALPH COLEMAN INTERNATIONAL LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 OCTOBER 2020
21
Related party transactions
(Continued)
- 25 -
Transactions with related parties
During the year the company entered into the following transactions with related parties:
Purchases
2020
2019
£
£
Entities which provide key management personnel services to the company
-
10,572
22
Ultimate controlling party
The parent company of Ralph Coleman International Limited is Ralph Coleman Holdings Limited, its registered address is Hazell Way, Bermuda Road Industrial Estate, Nuneaton, Warwickshire, CV10 7PQ.
On 9 October 2018, the Ralph Coleman Holdings Limited became a subsidiary of Premier House Investments Limited, its registered address is Hazell Way, Bermuda Road Industrial Estate, Nuneaton, Warwickshire, CV10 7PQ.
Premier House Investments Limited produces group accounts which are publicly available.
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