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Registered number: 04274240
MORRELLS FARMING LIMITED
FINANCIAL STATEMENTS
INFORMATION FOR FILING WITH THE REGISTRAR
FOR THE YEAR ENDED 31 MARCH 2022
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MORRELLS FARMING LIMITED
REGISTERED NUMBER: 04274240
BALANCE SHEET
AS AT 31 MARCH 2022
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Creditors: amounts falling due after more than one year
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Provisions for liabilities
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MORRELLS FARMING LIMITED
REGISTERED NUMBER: 04274240
BALANCE SHEET (CONTINUED)
AS AT 31 MARCH 2022
The Company's financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.
The financial statements have been delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The Company has opted not to file the statement of comprehensive income in accordance with provisions applicable to companies subject to the small companies' regime.
The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
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D.J.G. Morrell
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The notes on pages 4 to 19 form part of these financial statements.
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MORRELLS FARMING LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2022
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Comprehensive income for the year
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Total comprehensive income for the year
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Total transactions with owners
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Comprehensive income for the year
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Revaluation gains/losses net of deferred tax
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Total comprehensive income for the year
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The notes on pages 4 to 19 form part of these financial statements.
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MORRELLS FARMING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
The company's operations relate to the farming of land, rental income, other contracting income and electricity generation.
The company operates within the United Kingdom.
The company is a private company limited by shares and is incorporated and domiciled in England.
The address of its registered office is Waggoners Cottage, Sandford Common, Sandford St Martin, Chipping Norton, Oxfordshire, OX7 7AE.
2.ACCOUNTING POLICIES
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Summary of significant accounting policies and key accounting estimates
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Exceptional items are transactions that fall within the ordinary activities of the Company but are presented separately due to their size or incidence.
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BASIS OF PREPARATION OF FINANCIAL STATEMENTS
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The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies.
The following principal accounting policies have been applied:
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FINANCIAL REPORTING STANDARD 102 - REDUCED DISCLOSURE EXEMPTIONS
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The Company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
∙the requirements of Section 7 Statement of Cash Flows;
∙the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d).
This information is included in the consolidated financial statements of Morrells Holdings Limited as at 31 March 2022 and these financial statements may be obtained from Companies House.
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MORRELLS FARMING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
2.ACCOUNTING POLICIES (CONTINUED)
The directors acknowledge the net current liabilities position of £9,857,471 (2021: £10,370,349). This position is due to the classification of the intercompany loan of £10,503,005 (2021: £10,959,768) as due within less than one year. Without this balance the company would have net current assets of £645,534 (2021: £589,419) which would show the working capital position of the company to be reasonable.
Having taken appropriate enquiries, the directors confirm this balance will not be called in at the detriment to the cashflow of the company and have accordingly prepared the accounts on a going concern basis.
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:
Sale of goods
Revenue from the sale of goods is recognised when all of the following conditions are satisfied:
∙the Company has transferred the significant risks and rewards of ownership to the buyer;
∙the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
∙the amount of revenue can be measured reliably;
∙it is probable that the Company will receive the consideration due under the transaction; and
∙the costs incurred or to be incurred in respect of the transaction can be measured reliably.
Rendering of services
Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
∙the amount of revenue can be measured reliably;
∙it is probable that the Company will receive the consideration due under the contract;
∙the stage of completion of the contract at the end of the reporting period can be measured reliably; and
∙the costs incurred and the costs to complete the contract can be measured reliably.
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MORRELLS FARMING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
2.ACCOUNTING POLICIES (CONTINUED)
Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.
All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, provided on the following basis.
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10% reducing balance or 4-25% straight line
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The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
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REVALUATION OF TANGIBLE FIXED ASSETS
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Individual freehold and leasehold properties are carried at current year value at fair value at the date of the revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses. Revaluations are undertaken with sufficient regularity to ensure the carrying amount does not differ materially from that which would be determined using fair value at the balance sheet date.
Fair values are determined from market based evidence normally undertaken by professionally qualified valuers.
Revaluation gains and losses are recognised in other comprehensive income unless losses exceed the previously recognised gains or reflect a clear consumption of economic benefits, in which case the excess losses are recognised in profit or loss.
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MORRELLS FARMING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
2.ACCOUNTING POLICIES (CONTINUED)
Investment property is carried at fair value determined annually by external valuers and derived from the current market rents and investment property yields for comparable real estate, adjusted if necessary for any difference in the nature, location or condition of the specific asset. No depreciation is provided. Changes in fair value are recognised in profit or loss.
Investments in subsidiaries are measured at cost less accumulated impairment.
Investments in unlisted Company shares, whose market value can be reliably determined, are remeasured to market value at each balance sheet date. Gains and losses on remeasurement are recognised in the Statement of Comprehensive Income for the period. Where market value cannot be reliably determined, such investments are stated at historic cost less impairment.
Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a weighted average basis. Work in progress and finished goods include labour and attributable overheads.
At each balance sheet date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.
Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
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CASH AND CASH EQUIVALENTS
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Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.
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MORRELLS FARMING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
2.ACCOUNTING POLICIES (CONTINUED)
The Company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of an out-right short-term loan that is not at market rate, the financial asset or liability is measured, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost, unless it qualifies as a loan from a director in the case of a small company, or a public benefit entity concessionary loan.
Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Statement of Comprehensive Income.
For financial assets measured at amortised cost, the impairment loss is measured as the difference between an asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If a financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract.
For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount and best estimate of the recoverable amount, which is an approximation of the amount that the Company would receive for the asset if it were to be sold at the balance sheet date.
Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
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MORRELLS FARMING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
2.ACCOUNTING POLICIES (CONTINUED)
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FOREIGN CURRENCY TRANSLATION
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Functional and presentation currency
The Company's functional and presentational currency is GBP.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the spot exchange rates at the dates of the transactions.
At each period end foreign currency monetary items are translated using the closing rate. Non-monetary items measured at historical cost are translated using the exchange rate at the date of the transaction and non-monetary items measured at fair value are measured using the exchange rate when fair value was determined.
Foreign exchange gains and losses resulting from the settlement of transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss except when deferred in other comprehensive income as qualifying cash flow hedges.
Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Statement of Comprehensive Income within 'finance income or costs'. All other foreign exchange gains and losses are presented in profit or loss within 'other operating income'.
Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.
Defined contribution pension plan
The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Balance Sheet. The assets of the plan are held separately from the Company in independently administered funds.
Interest income is recognised in profit or loss using the effective interest method.
All borrowing costs are recognised in profit or loss in the year in which they are incurred.
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MORRELLS FARMING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
2.ACCOUNTING POLICIES (CONTINUED)
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PROVISIONS FOR LIABILITIES
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Provisions are made where an event has taken place that gives the Company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.
Provisions are charged as an expense to profit or loss in the year that the Company becomes aware of the obligation, and are measured at the best estimate at the balance sheet date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.
When payments are eventually made, they are charged to the provision carried in the Balance Sheet.
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CURRENT AND DEFERRED TAXATION
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The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Company operates and generates income.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:
∙The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
∙Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.
Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.
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MORRELLS FARMING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
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An analysis of turnover by class of business is as follows:
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Stewardship Scheme income
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All turnover arose within the United Kingdom
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The average monthly number of employees, including the directors, during the year was as follows:
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MORRELLS FARMING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
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Single Farm Payment entitlement
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MORRELLS FARMING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
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Charge for the year on owned assets
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A bank loan in Morrells Holdings Limited, the parent company, is secured against freehold properties held in Morrells Farming Limited.
A mortgage charge is held over the land at Manor Farm Hardwick Road for monies to due or to become due to Agricultural Mortgage Corporation PLC.
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MORRELLS FARMING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
6.TANGIBLE FIXED ASSETS (CONTINUED)
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The net book value of land and buildings may be further analysed as follows:
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The net book value of assets held under finance leases or hire purchase contracts, included above, are as follows:
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Other fixed asset investments
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MORRELLS FARMING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
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Freehold investment property
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The 2022 valuations were made by Jonathan Lovegrove-Fielden (FRICS), a director, on an open market value for existing use basis.
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If the Investment properties had been accounted for under the historic cost accounting rules, the properties would have been measured as follows:
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Finished goods and goods for resale
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MORRELLS FARMING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
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Prepayments and accrued income
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CASH AND CASH EQUIVALENTS
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CREDITORS: Amounts falling due within one year
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Amounts owed to group undertakings
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Obligations under finance lease and hire purchase contracts
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Accruals and deferred income
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The company's bankers hold an unlimited debenture incorporating a fixed and floating charge.
There is also fixed and floating charges over 100 acres of land at downhill farm and 107 acres at Downhill Farm.
Obligations under hire purchase contracts are secured on the assets to which they relate.
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MORRELLS FARMING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
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CREDITORS: Amounts falling due after more than one year
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Net obligations under finance leases and hire purchase contracts
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Obligations under hire purchase contracts are secured on the assets to which they relate.
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Analysis of the maturity of loans is given below:
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Amounts falling due after more than 5 years
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HIRE PURCHASE AND FINANCE LEASES
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Minimum lease payments under hire purchase fall due as follows:
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MORRELLS FARMING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
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Charged to profit or loss
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The provision for deferred taxation is made up as follows:
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Accelerated capital allowances
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On revaluation gains/losses
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Authorised, allotted, called up and fully paid
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1 (2021 - 1) Ordinary share of £1.00
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Revaluation reserve
The revaluation reserve comprises the cumulative gains on revaluation of the investment property and investment portfolios.
Profit and loss account
The profit and loss account comprises the cumulative retained earnings of the company since incorporation.
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MORRELLS FARMING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
The company contributes to a defined contribution pensions scheme which requires contributions to be made separately administered funds. The pension cost charge represents contributions payable by the company to the funds and amounted to £403 (2021: £493). The balance outstanding at the year end in respect of these transactions was £123 (2021: £nil).
The company's ultimate parent undertaking is Morrells Holdings Limited, a company incorporated in the UK. There is no single controlling party of Morrells Holdings Limited.
The auditors' report on the financial statements for the year ended 31 March 2022 was unqualified.
The audit report was signed on 21 March 2023 by Andy Malpass BA FCA (Senior Statutory Auditor) on behalf of WR Partners.
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