John Smart Limited - Period Ending 2016-12-31

Registration number: 03079741

John Smart Limited

Annual Report and Unaudited Financial Statements

for the Year Ended 31 December 2016

Westlake Clark
Chartered Accountants
7 Lynwood Court
Priestlands Place
Lymington
Hampshire
SO41 9GA

John Smart Limited

Contents

Company Information	1
Balance Sheet	2 to 3
Notes to the Financial Statements	4 to 12

John Smart Limited

Company Information

Directors

J R Smart K M Watts

Company secretary

J J B Lamb

Registered office

44 Station Road New Milton Hampshire BH25 6JX

Bankers

Barclays Bank Plc 21 High Street Lymington Hampshire SO41 9YJ

Accountants

Westlake Clark Chartered Accountants 7 Lynwood Court Priestlands Place Lymington Hampshire SO41 9GA

Page 1

John Smart Limited

(Registration number: 03079741)
Balance Sheet as at 31 December 2016

	Note	2016 £	(As restated) 2015 £
Fixed assets
Tangible assets	4	903,898	824,198
Other financial assets	5	13,500	13,500
		917,398	837,698
Current assets
Debtors	6	17,209	86,043
Cash at bank and in hand		11,136	4,002
		28,345	90,045
Creditors: Amounts falling due within one year	7	(69,833)	(57,737)
Net current (liabilities)/assets		(41,488)	32,308
Total assets less current liabilities		875,910	870,006
Creditors: Amounts falling due after more than one year	7	(178,140)	(203,360)
Provisions for liabilities		(3,306)	(3,483)
Net assets		694,464	663,163
Capital and reserves
Called up share capital		2	2
Revaluation reserve		109,848	109,671
Profit and loss account		584,614	553,490
Total equity		694,464	663,163

The notes on pages 4 to 12 form an integral part of these financial statements.

Page 2

John Smart Limited

(Registration number: 03079741)
Balance Sheet as at 31 December 2016 (continued)

For the financial year ending 31 December 2016 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.

Directors' responsibilities:

•	The members have not required the company to obtain an audit of its accounts for the year in question in accordance with section 476; and
•	The directors acknowledge their responsibilities for complying with the requirements of the Act with respect to accounting records and the preparation of accounts.

These financial statements have been prepared in accordance with the special provisions relating to companies subject to the small companies regime within Part 15 of the Companies Act 2006.

These financial statements have been delivered in accordance with the provisions applicable to companies subject to the small companies regime and the option not to file the Profit and Loss Account has been taken.

Approved and authorised by the Board on 15 August 2017 and signed on its behalf by:
 

.........................................

J R Smart

Director

The notes on pages 4 to 12 form an integral part of these financial statements.

Page 3

John Smart Limited

Notes to the Financial Statements for the Year Ended 31 December 2016

1	General information

The company is a private company limited by share capital incorporated in England and Wales.

The address of its registered office is:
44 Station Road
New Milton
Hampshire
BH25 6JX

2	Accounting policies

Summary of significant accounting policies and key accounting estimates

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

Statement of compliance

These financial statements have been prepared in accordance with Financial Reporting Standard 102 Section 1A - 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' and the Companies Act 2006.

Basis of preparation

These financial statements have been prepared using the historical cost convention except that as disclosed in the accounting policies certain items are shown at fair value.

The company's functional and presentational currency is pound sterling.

Going concern

The financial statements have been prepared on a going concern basis.

Revenue recognition

Turnover comprises the fair value of the consideration received or receivable for the sale of goods and provision of services in the ordinary course of the company’s activities. Turnover is shown net of sales/value added tax, returns, rebates and discounts and after eliminating sales within the company.

The company recognises revenue when:
The amount of revenue can be reliably measured;
it is probable that future economic benefits will flow to the entity;
and specific criteria have been met for each of the company's activities.

Tax

The tax expense for the period comprises current tax. Tax is recognised in profit or loss, except that a change attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the company operates and generates taxable income.

Page 4

John Smart Limited

Notes to the Financial Statements for the Year Ended 31 December 2016 (continued)

2	Accounting policies (continued)

Tangible assets

Tangible assets are stated in the statement of financial position at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.

The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.

Depreciation

Depreciation is charged so as to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:

Asset class	Depreciation method and rate
Furniture and fittings	25% reducing balance
Office equipment	25% reducing balance
Freehold land and buildings	Not depreciated

Investment property

The company's properties are held for long-term investment. Investment properties are accounted for in accordance with the Financial Reporting Standard for Small Entities (FRS 102), as follows:

No depreciation is provided in respect of investment properties and they are revalued annually. The surplus or deficit on revaluation is transferred to the revaluation reserve unless a deficit below original cost, or its reversal, on an individual property is expected to be permanent, in which case it is recognised in the profit and loss account for the year.

This treatment as regards the company's investment properties may be a departure from the requirements of the Companies Act concerning the depreciation of fixed assets. However, these properties are not held for consumption but for investment and the directors consider that systematic annual depreciation would be inappropriate. The accounting policy adopted is therefore necessary for the financial statements to give a true and fair view. Depreciation or amortisation is only one of the many factors reflected in the annual valuation and the amount which might otherwise have been shown cannot be separately identified or quantified.

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.

Borrowings

Interest-bearing borrowings are initially recorded at fair value, net of transaction costs. Interest-bearing borrowings are subsequently carried at amortised cost, with the difference between the proceeds, net of transaction costs, and the amount due on redemption being recognised as a charge to the Profit and Loss Account over the period of the relevant borrowing.

Interest expense is recognised on the basis of the effective interest method and is included in interest payable and similar charges.

Borrowings are classified as current liabilities unless the company has an unconditional right to defer settlement of the liability for at least twelve months after the reporting date.

Page 5

John Smart Limited

Notes to the Financial Statements for the Year Ended 31 December 2016 (continued)

2	Accounting policies (continued)

Share capital

Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.

Dividends

Dividend distribution to the company’s shareholders is recognised as a liability in the financial statements in the reporting period in which the dividends are declared.

Defined contribution pension obligation

A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the company has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.

Contributions to defined contribution plans are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.

3	Staff numbers

The average number of persons employed by the company (including directors) during the year, was 2 (2015 - 2).

Page 6

John Smart Limited

Notes to the Financial Statements for the Year Ended 31 December 2016 (continued)

4	Tangible assets

	Freehold land and buildings £	Furniture and fittings  £	Office equipment  £	Total £
Cost or valuation
At 1 January 2016	823,000	7,535	1,174	831,709
Additions	80,000	-	-	80,000
At 31 December 2016	903,000	7,535	1,174	911,709
Depreciation
At 1 January 2016	-	7,217	294	7,511
Charge for the year	-	80	220	300
At 31 December 2016	-	7,297	514	7,811
Carrying amount
At 31 December 2016	903,000	238	660	903,898
At 31 December 2015	823,000	318	880	824,198

Revaluation

The fair value of the company's investment properties was revalued on 31 December 2013. An independent valuer was not involved.
Had this class of asset been measured on a historical cost basis, the carrying amount would have been £789,805 (2015 - £709,805).

5	Other financial assets (current and non-current)

	2016 £	2015 £
Non-current financial assets
Financial assets at cost less impairment	13,500	13,500

6

Debtors

	2016 £	2015 £
Other debtors	17,209	17,208
Directors current account	-	68,835
Total current trade and other debtors	17,209	86,043

Page 7

John Smart Limited

Notes to the Financial Statements for the Year Ended 31 December 2016 (continued)

7

Creditors

	Note	2016 £	2015 £
Due within one year
Bank loans and overdrafts	8	23,000	21,000
Other creditors		1,000	1,000
Corporation tax liability		25,080	34,729
Accruals and deferred income		1,008	1,008
Directors current accounts		19,745	-
		69,833	57,737
Due after one year
Loans and borrowings	8	178,140	203,360

	2016 £	2015 £
After more than five years by instalments	86,140	140,360

8	Loans and borrowings

	2016 £	2015 £
Non-current loans and borrowings
Bank borrowings	178,140	203,360

	2016 £	2015 £
Current loans and borrowings
Bank borrowings	23,000	21,000

Bank borrowings

Mortgage is denominated in pounds sterling with a nominal interest rate of 1.20%, and the final instalment is due on . The carrying amount at year end is £75,000 (2015 - £75,000).

Business loan is denominated in pounds sterling with a nominal interest rate of , and the final instalment is due on . The carrying amount at year end is £126,140 (2015 - £149,360).

Page 8

John Smart Limited

Notes to the Financial Statements for the Year Ended 31 December 2016 (continued)

9	Related party transactions

Transactions with directors

2016	At 1 January 2016 £	Repayments by director £	At 31 December 2016 £
J R Smart
Advance/credit	68,835	(68,835)	-

2015	At 1 January 2015 £	Advances to directors £	At 31 December 2015 £
J R Smart
Advance/credit	34,835	34,000	68,835

Page 9

John Smart Limited

Notes to the Financial Statements for the Year Ended 31 December 2016 (continued)

10	Transition to FRS 102

Changes were made to the accounts with respect to the transition to FRS 102 concerning deferred tax.

Balance Sheet at 1 January 2015
 

	As originally reported £	Reclassification £	Remeasurement £	As restated £
Fixed assets
Tangible assets	424	-	-	424
Investment property	823,000	-	-	823,000
Investments	13,500	-	-	13,500
	836,924	-	-	836,924
Current assets
Debtors	34,835	-	-	34,835
Cash at bank and in hand	24,509	-	-	24,509
	59,344	-	-	59,344
Creditors: Amounts falling due within one year	(31,859)	-	-	(31,859)
Net current assets	27,485	-	-	27,485
Total assets less current liabilities	864,409	-	-	864,409
Creditors: Amounts falling due after more than one year	(225,853)	-	-	(225,853)
Net assets	638,556	-	-	638,556
Capital and reserves
Called up share capital	2	-	-	2
Revaluation reserve	113,154	-	(3,485)	109,669
Profit and loss account	525,400	-	-	525,400
Total equity	638,556	-	(3,485)	635,071

Page 10

John Smart Limited

Notes to the Financial Statements for the Year Ended 31 December 2016 (continued)

10	Transition to FRS 102 (continued)

Balance Sheet at 31 December 2015
 

	As originally reported £	Reclassification £	Remeasurement £	As restated £
Fixed assets
Tangible assets	1,198	-	-	1,198
Investment property	823,000	-	-	823,000
Investments	13,500	-	-	13,500
	837,698	-	-	837,698
Current assets
Debtors	86,043	-	-	86,043
Cash at bank and in hand	4,002	-	-	4,002
	90,045	-	-	90,045
Creditors: Amounts falling due within one year	(57,737)	-	-	(57,737)
Net current assets	32,308	-	-	32,308
Total assets less current liabilities	870,006	-	-	870,006
Creditors: Amounts falling due after more than one year	(203,360)	-	-	(203,360)
Net assets	666,646	-	-	666,646
Capital and reserves
Called up share capital	2	-	-	2
Revaluation reserve	113,154	-	(3,483)	109,671
Profit and loss account	553,490	-	-	553,490
Total equity	666,646	-	(3,483)	663,163

Page 11

John Smart Limited

Notes to the Financial Statements for the Year Ended 31 December 2016 (continued)

10	Transition to FRS 102 (continued)

Profit and Loss Account for the year ended 31 December 2015
 

	Note	As originally reported £	Reclassification £	Remeasurement £	As restated £
Turnover		56,471	-	-	56,471
Cost of sales		(3,274)	-	-	(3,274)
Gross profit		53,197	-	-	53,197
Administrative expenses		(10,536)	-	-	(10,536)
Operating profit		42,661	-	-	42,661
Interest payable and similar expenses		(5,901)	-	-	(5,901)
		(5,901)	-	-	(5,901)
Profit before tax		36,760	-	-	36,760
Taxation		(8,670)	-	(2)	(8,672)
Profit/(loss) for the financial year		28,090	-	(2)	28,088

Page 12