Company Registration No. 08514575 (England and Wales)
S M S FARMING LIMITED
UNAUDITED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 MAY 2018
PAGES FOR FILING WITH REGISTRAR
Century House
Wargrave Road
Henley-on-Thames
RG9 2LT
S M S FARMING LIMITED
CONTENTS
Page
Company information
1
Balance sheet
2 - 3
Notes to the financial statements
4 - 10
S M S FARMING LIMITED
COMPANY INFORMATION
- 1 -
Directors
Mr. L. Morgan
Mr. G. Morgan
Mr. N Morgan
(Appointed 26 March 2018)
Mr. R Morgan
(Appointed 26 March 2018)
Mr. C. Morgan
(Appointed 26 March 2018)
Mr. P Turner
(Appointed 1 June 2018)
Company number
08514575
Registered office
Field Farm
Netherton Road
Appleton
Abingdon
Oxfordshire
United Kingdom
OX13 5QW
Accountants
Taylorcocks
Century House
Wargrave Road
Henley-on-Thames
RG9 2LT
S M S FARMING LIMITED
BALANCE SHEET
AS AT 30 MAY 2018
30 May 2018
- 2 -
2018
2017
Notes
£
£
£
£
Fixed assets
Tangible assets
3
9,660,397
8,789,578
Current assets
Stocks
2,082,550
1,480,000
Debtors
4
51,573
54,046
Cash at bank and in hand
37,093
108,938
2,171,216
1,642,984
Creditors: amounts falling due within one year
5
(913,182)
(908,074)
Net current assets
1,258,034
734,910
Total assets less current liabilities
10,918,431
9,524,488
Creditors: amounts falling due after more than one year
6
(5,032,793)
(3,844,716)
Net assets
5,885,638
5,679,772
Capital and reserves
Called up share capital
7
8
8
Revaluation reserve
5,575,000
5,575,000
Profit and loss reserves
310,630
104,764
Total equity
5,885,638
5,679,772
S M S FARMING LIMITED
BALANCE SHEET (CONTINUED)
AS AT 30 MAY 2018
30 May 2018
- 3 -

The directors of the company have elected not to include a copy of the profit and loss account within the financial statements. true

For the financial year ended 30 May 2018 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.

The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.

T he members have not required the company to obtain an audit of its financial statements for the year in question in accordance with section 476 .

These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies' regime.

The financial statements were approved by the board of directors and authorised for issue on 27 February 2019 and are signed on its behalf by:
Mr. N Morgan
Director
Company Registration No. 08514575
The notes on pages 4 to 10 form part of these financial statements
S M S FARMING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 MAY 2018
- 4 -
1
Accounting policies
Company information

S M S Farming Limited (08514575) is a private company limited by shares incorporated in England and Wales. The registered office is Field Farm, Netherton Road, Appleton, Abingdon, Oxfordshire, United Kingdom, OX13 5QW.

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 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.

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.

1.2
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.

1.3
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:

Land and buildings Freehold
not depreciated
Plant and machinery
10% Straight line
Motor vehicles
33% Reducing balance

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss .

The fair value of plant and machinery at the year end is significantly higher than the net book value recorded in the financial statements. As a result, no depreciation has been charged on plant and machinery in 2018 and accumulated depreciation in full has been reversed.

 

This has brought the value of plant and machinery more in line with the fair value at 31 May 2018.

S M S FARMING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 MAY 2018
1
Accounting policies
(Continued)
- 5 -
1.4
Impairment of fixed assets

At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

1.5
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 replacement cost and 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.

1.6
Cash at bank and in hand

Cash at bank and in hand 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.

1.7
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.

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.

S M S FARMING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 MAY 2018
1
Accounting policies
(Continued)
- 6 -
Basic financial liabilities

Basic financial liabilities, including creditors and bank loans 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.

 

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

 

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.

1.8
Equity instruments

Equity instruments issued by the company are recorded at the proceeds received, net of direct issue costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

1.9
Derivatives

Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently remeasured to fair value at each reporting end date. The resulting gain or loss is recognised in profit or loss immediately unless the derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on the nature of the hedge relationship.

 

A derivative with a positive fair value is recognised as a financial asset, whereas a derivative with a negative fair value is recognised as a financial liability.

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.

S M S FARMING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 MAY 2018
1
Accounting policies
(Continued)
- 7 -
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
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 the profit and loss account so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Rentals payable under operating leases, including any lease incentives received, are charged to income 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 asset are consumed.

2
Employees

The average monthly number of persons (including directors) employed by the company during the year was 5 (2017 - 4).

S M S FARMING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 MAY 2018
- 8 -
3
Tangible fixed assets
Land and buildings Freehold
Plant and machinery
Motor vehicles
Total
£
£
£
£
Cost or valuation
At 31 May 2017
8,490,721
407,646
13,990
8,912,357
Additions
642,940
119,850
10,200
772,990
Disposals
-
(12,350)
-
(12,350)
At 30 May 2018
9,133,661
515,146
24,190
9,672,997
Depreciation and impairment
At 31 May 2017
-
118,162
4,617
122,779
Depreciation charged in the year
-
(114,457)
7,983
(106,474)
Eliminated in respect of disposals
-
(3,705)
-
(3,705)
At 30 May 2018
-
-
12,600
12,600
Carrying amount
At 30 May 2018
9,133,661
515,146
11,590
9,660,397
At 30 May 2017
8,490,721
289,484
9,373
8,789,578

If revalued assets were stated on an historical cost basis rather than a fair value basis, the total amounts included would have been as follows:

2018
2017
£
£
Cost
2,909,500
2,875,000
Accumulated depreciation
-
-
Carrying value
2,909,500
2,875,000

Included within the net book value is £168,199 (2017 - £41,944 ) relating to assets held under hire purchase contracts. The depreciation charged to the financial statements in the year in respect of such assets amounted to -£6,405 (2017 - £4,835).

S M S FARMING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 MAY 2018
- 9 -
4
Debtors
2018
2017
Amounts falling due within one year:
£
£
Other debtors
51,573
50,252
Prepayments and accrued income
-
3,794
51,573
54,046
5
Creditors: amounts falling due within one year
2018
2017
Notes
£
£
Bank loans and overdrafts
469,163
680,611
Obligations under hire purchase agreements
79,900
42,711
Trade creditors
10,056
7,032
Corporation tax
6,546
37,507
Other creditors
347,517
137,813
Accruals and deferred income
-
2,400
913,182
908,074

The aggregate amount of creditors for which security has been given amounted to £ 549,063 (201 7 - £ 723,322 ).

The hire purchase liabilities are secured on the assets to which they relate.
6
Creditors: amounts falling due after more than one year
2018
2017
Notes
£
£
Bank loans and overdrafts
4,936,089
3,482,431
Obligations under hire purchase agreements
91,451
62,285
Other borrowings
-
300,000
Other creditors
5,253
-
5,032,793
3,844,716

The aggregate amount of creditors for which security has been given amounted to £ 5,027,540 (20 17 - £ 3,544,716 ).

The hire purchase liabilities are secured on the assets to which they relate.
S M S FARMING LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 MAY 2018
- 10 -
7
Called up share capital
2018
2017
£
£
Ordinary share capital
Issued and fully paid
8 Ordinary shares of £1 each
8
8
8
8
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