Company No: 04159604 (England and Wales)

Contents

• Statement of Financial Position
• Notes to the Financial Statements

	Note	2022		2021
		£		£
Fixed assets
Tangible assets	3	461,629		543,966
		461,629		543,966
Current assets
Stocks		32,383		1,262,719
Debtors	4	182,304		738,870
Cash at bank and in hand		176		4,751
		214,863		2,006,340
Creditors: amounts falling due within one year	5	( 207,432)		( 931,519)
Net current assets		7,431		1,074,821
Total assets less current liabilities		469,060		1,618,787
Creditors: amounts falling due after more than one year	6	( 238,909)		( 623,552)
Provision for liabilities		0		( 24,157)
Net assets		230,151		971,078
Capital and reserves
Called-up share capital	7	140		140
Share premium account		89,991		89,991
Other reserves		29		29
Profit and loss account		139,991		880,918
Total shareholders' funds		230,151		971,078

For the financial year ending 31 December 2022 the Company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.

Director's responsibilities:

• The members have not required the Company to obtain an audit of its financial statements for the financial year in accordance with section 476;
• The director acknowledges their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements; and
• These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime and a copy of the Statement of Income and Retained Earnings has not been delivered.

The financial statements of Paligap Limited (registered number: 04159604) were approved and authorised for issue by the Director on 28 September 2023. They were signed on its behalf by:

Mr D C Lane Director

1. Accounting policies

The principal accounting policies are summarised below. They have all been applied consistently throughout the financial year and to the preceding financial year, unless otherwise stated.

General information and basis of accounting

Paligap Limited (the Company) is a private company, limited by shares, incorporated in the United Kingdom under the Companies Act 2006 and is registered in England and Wales. The address of the Company's registered office is Paligap Ltd 6d Littlecombe Business Park, Lister Road, Dursley, GL11 4BA, United Kingdom.

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 items at fair value, and in accordance with Section 1A of Financial Reporting Standard 102 (FRS 102) ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland’ issued by the Financial Reporting Council and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime.

The financial statements are presented in pounds sterling which is the functional currency of the Company and rounded to the nearest £.

Going concern

During the period, management made the decision to wind up the Company in the near future. As such, the financial statements are prepared on a basis other than that of a going concern basis.

No adjustments to the carrying value of any assets or liabilities were required as a result of this.

Foreign currency

Transactions in foreign currencies are recorded at the rate of exchange at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the Statement of Financial Position date are reported at the rates of exchange prevailing at that date.

Exchange differences are recognised in the Statement of Income and Retained Earnings in the period in which they arise except for exchange differences arising on gains or losses on non-monetary items which are recognised in the Statement of Comprehensive Income.

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.

Turnover is recognised when the significant risks and rewards are considered to have been transferred to the customer.

Interest income

Interest income is recognised when it is probable that the economic benefits will flow to the Company and the amount of revenue can be measured reliably. Interest income is accrued on a time basis, by reference to the principal outstanding at the effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset's net carrying amount on initial recognition.

Finance costs

Finance costs are charged to the Statement of Income and Retained Earnings over the term of the debt using the effective interest method so 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.

Taxation

Current tax
Current tax is provided at amounts expected to be paid (or recoverable) using the tax rates and laws that have been enacted or substantively enacted at the Statement of Financial Position date.

Deferred tax
Deferred tax arises as a result of including items of income and expenditure in taxation computations in periods different from those in which they are included in the Company's financial statements. Deferred tax is provided in full on timing differences which result in an obligation to pay more or less tax at a future date, at the average tax rates that are expected to apply when the timing differences reverse, based on current tax rates and laws. Deferred tax assets and liabilities are not discounted.

The carrying amount of deferred tax assets are reviewed at each reporting date and a valuation allowance is set up against deferred tax assets so that the net carrying amount equals the highest amount that is more likely than not to be recovered based on current or future taxable profit.

Tangible fixed assets

Tangible fixed assets are stated at cost (or deemed cost) or valuation less accumulated depreciation and accumulated impairment losses. Cost includes costs directly attributable to making the asset capable of operating as intended. Depreciation is provided on all tangible fixed assets, other than investment properties and freehold land, at rates calculated to write off the cost or valuation, less estimated residual value, of each asset on a straight-line basis over its expected useful life, as follows:

Land and buildings	not depreciated
Plant and machinery	3 - 5 years straight line
Vehicles	4 years straight line
Fixtures and fittings	4 years straight line
Office equipment	2 - 4 years straight line

Residual value represents the estimated amount which would currently be obtained from disposal of an asset, after deducting estimated costs of disposal, if the asset were already of the age and in the condition expected at the end of its useful life.

Leases

The Company as lessee
Assets held under finance leases, hire purchase contracts and other similar arrangements, which confer rights and obligations similar to those attached to owned assets, are capitalised as tangible fixed assets at the fair value of the leased asset (or, if lower, the present value of the minimum lease payments as determined at the inception of the lease) and are depreciated over the shorter of the lease terms and their useful lives. The capital elements of future lease obligations are recorded as liabilities, while the interest elements are charged to the Statement of Income and Retained Earnings over the period of the leases to produce a constant periodic rate of interest on the remaining balance of the liability.

Rentals under operating leases are charged on a straight-line basis over the lease term, even if the payments are not made on such a basis. Benefits received and receivable as an incentive to sign an operating lease are similarly spread on a straight-line basis over the lease term.

Impairment of assets

Assets, other than those measured at fair value, are assessed for indicators of impairment at each Statement of Financial Position date. If there is objective evidence of impairment, an impairment loss is recognised in the Statement of Income and Retained Earnings as described below.

Non-financial assets
At each balance sheet date, the company reviews 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). The recoverable amount of an asset is the higher of its fair value less costs to sell and its 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.

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. 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.

Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to sell, which is equivalent to the net realisable value. Cost includes materials, direct labour and an attributable proportion of manufacturing overheads based on normal levels of activity. Cost is calculated using the FIFO (first-in, first-out) method. Provision is made for obsolete, slow-moving or defective items where appropriate.

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.

Trade and other debtors

Trade and other debtors are initially recognised at fair value and thereafter stated at amortised cost using the effective interest method less impairment losses for bad and doubtful debts, except where the effect of discounting would be immaterial. In such cases the receivables are stated at cost less impairment losses for bad and doubtful debts.

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 creditors: amounts falling due within one year.

Trade and other creditors

Trade and other creditors are initially recognised at fair value and thereafter stated at amortised cost using the effective interest rate method, unless the effect of discounting would be immaterial, in which case they are stated at cost.

Financial instruments

Financial assets and financial liabilities are recognised when the Company becomes a party to the contractual provisions of the instrument.

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.

Financial assets and liabilities are only offset in the Balance Sheet when, and only when there exists a legally enforceable right to set off the recognised amounts and the Company intends either 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.

Derivative financial instruments
The Company uses derivative financial instruments to reduce exposure to foreign exchange risk and interest rate movements. The Company does not hold or issue derivative financial instruments for speculative purposes.

Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently remeasured to their fair value at each reporting date. The resulting gain or loss is recognised in the Statement of Income and Retained Earnings immediately.

The Company does not apply hedge accounting.

Provisions

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 that obligation and a reliable estimate can be made of the amount of the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the Statement of Financial Position date, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows (when the effect of the time value of money is material).

When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, a receivable is recognised as an asset if it is virtually certain that reimbursement will be received and the amount of the receivable can be measured reliably.

2. Employees

	2022		2021
	Number		Number
Monthly average number of persons employed by the Company during the year, including the director	7		11

3. Tangible assets

	Land and buildings		Plant and machinery		Vehicles		Fixtures and fittings		Office equipment		Total
	£		£		£		£		£		£
Cost
At 01 January 2022	440,651		135,074		40,943		2,264		109,035		727,967
Additions	11,940		2,253		0		27,033		8,527		49,753
Disposals	0		( 137,327)		( 40,943)		( 29,297)		( 26,985)		( 234,552)
At 31 December 2022	452,591		0		0		0		90,577		543,168
Accumulated depreciation
At 01 January 2022	0		51,787		40,356		2,264		89,594		184,001
Charge for the financial year	0		26,093		150		5,676		14,177		46,096
Disposals	0		( 77,880)		( 40,506)		( 7,940)		( 22,232)		( 148,558)
At 31 December 2022	0		0		0		0		81,539		81,539
Net book value
At 31 December 2022	452,591		0		0		0		9,038		461,629
At 31 December 2021	440,651		83,287		587		0		19,441		543,966

4. Debtors

	2022		2021
	£		£
Trade debtors	180,043		658,507
Prepayments	0		7,712
VAT recoverable	0		72,651
Other taxation and social security	2,261		0
	182,304		738,870

Included within trade debtors is £158,503 (2021: £602,686) of debts used as security against the Company's invoice discounting facility with HSBC Invoice Finance (UK) Limited

5. Creditors: amounts falling due within one year

	2022		2021
	£		£
Bank loans and overdrafts (secured £ 25,699)	28,270		132,493
Trade creditors	5,601		189,656
Accruals	2,251		42,942
Taxation and social security	69,559		41,836
Obligations under finance leases and hire purchase contracts	0		1,537
Other creditors	101,751		523,055
	207,432		931,519

Amounts shown under bank loans and overdafts of £25,699 (2021: £24,765) are secured against the freehold property of the Company.

Obligations under finance lease and hire purchase contracts are secured upon the assets to which they relate.

HSBC Invoice Finance (UK) Limited holds a fixed charge over debts as disclosed in note 4.

6. Creditors: amounts falling due after more than one year

	2022		2021
	£		£
Bank loans (secured)	238,909		266,510
Other creditors	0		357,042
	238,909		623,552

Amounts shown under bank loans £238,909 (2021: £266,510) are secured against the freehold property of the Company.

Amounts repayable after more than 5 years are included in creditors falling due over one year:

	2022		2021
	£		£
Bank loans (secured / repayable by instalments)	108,016		0

Amounts shown under bank loans £108,106 (2021: £158,323 ) are secured against the freehold property of the Company.

7. Called-up share capital

	2022		2021
	£		£
Allotted, called-up and fully-paid
80 A ordinary shares of £ 1.00 each	80		80
60 B ordinary shares of £ 1.00 each	60		60
	140		140

8. Financial commitments

Commitments

Total future minimum lease payments under non-cancellable operating leases are as follows:

	2022		2021
	£		£
within one year	0		36,292
between one and five years	0		151,340
	0		187,632

Pensions

The Company operates a defined contribution pension scheme for the director and employees. The assets of the scheme are held separately from those of the Company in an independently administered fund.

	2022		2021
	£		£
Unpaid contributions due to the fund (inc. in other creditors)	0		1,811

9. Related party transactions

Transactions with owners holding a participating interest in the entity

	2022		2021
	£		£
Balance due to participating interest at the year end	0		220,548

Transactions with the entity's director

	2022		2021
	£		£
Balance due to director at the year end	0		52,694

Interest is charged on the loan and there is no fixed date for repayment. The amount is included within amounts owed to director.