Company registration number 10122910 (England and Wales)
SMALL LUXURY HOTELS OF THE WORLD LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
SMALL LUXURY HOTELS OF THE WORLD LIMITED
COMPANY INFORMATION
Directors
R Hyde
S Leleu
E Tilley-Classey
A Kijkanakorn
(Appointed 25 May 2022)
R Widman
(Appointed 25 May 2022)
R Wiegmann
D Koetser
(Appointed 25 May 2022)
M Rinck
(Appointed 1 November 2022)
Company number
10122910
Registered office
7 Howick Place
London
SW1P 1BB
Auditor
Perrys Audit Limited
Chartered Accountants
4th Floor
399-401 Strand
London
WC2R 0LT
SMALL LUXURY HOTELS OF THE WORLD LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 1 -

The directors present the strategic report for the year ended 31 December 2022.

Fair review of the business

Small Luxury Hotels of the World Limited is a membership organisation in which the principal activities are the marketing of independently managed hotels (members) and the provision of an international reservation service for those members. The Company is expected to provide these services for the foreseeable future and the strategy is to continue to grow the membership of luxury independent hotels and to continue further development in new emerging markets. 2022 is the first year within the new structure whereby it is wholly owned by Small Luxury Hotels of the World Mgmt (SLHM). At the beginning of 2022 the Management Services Agreement was restructured resulting in all reservation profits now remaining within the company and changes were made to the way that staff costs are recharged on so that this now is just based on the employee cost. All costs relating to premises, equipment etc remain within SLHM. These changes are reflected in the company accounts for 2022 by an increase in profit above and beyond the increase in business.

 

The results of the Company show a turnover of £20,049K (2021: £10,253k) with a profit of £2,133K (2021: loss of (£1,662k)) this is a much larger profit than budgeted which is due to a number of factors, much higher reservations, increased Partnership Income together with savings on costs. These cost savings where largely due to staffing costs passed from SLHM.

 

As at 31 December 2022 the Company had net assets of £4,324K. In the opinion of the directors both the level of business and the year end financial position were satisfactory in the context of the challenges in the year due to the post pandemic affects on the company.

 

 

Principal risks and uncertainties

The main risks to the Company are economic collapse, major natural disaster, global health emergencies

or terrorist acts that affect people’s travelling behaviour. The continued risks and uncertainties faced by

the Company in the current global economic climate have been considered when producing the

budget for 2023.

 

Development and performance

We will continue to concentrate all efforts and resources on supporting the hotels and our other

customers post pandemic ensuring that we can react to the fast changing worldwide restrictions and be ready for the opening markets as they happen.

 

Going Concern

The Directors confirm that having reviewed the company’s cash requirements for a period of more than 12 months from the date of signing these financial statements, they have a good expectation that the company has adequate resources available to it to continue in operational existence and to meet its liabilities as and when they fall due. The Directors have accordingly adopted the going concern basis in preparing these financial statements.

 

The company is part of the Hotel Investment Partners group and is a wholly owned subsidiary of Small Luxury Hotels of the World Management Limited. The company can therefore also rely upon group support.

 

 

SMALL LUXURY HOTELS OF THE WORLD LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 2 -
Key performance indicators

Given the straightforward nature of the business, the company uses a small range of KPIs mainly the number and pace of hotels joining the brand in 2022 we welcomed 65 new properties (2021: 42). The Company had no employees in the financial year.

 

On behalf of the board

S Leleu
Director
2 October 2023
SMALL LUXURY HOTELS OF THE WORLD LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 3 -

The directors present their annual report and financial statements for the year ended 31 December 2022.

Principal activities

The principal activity of the company in the year under review was that of marketing of independently managed hotels (members) and the provision of an international reservation service for those members.

Results and dividends

The results for the year are set out on page 6.

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:

R Hyde
S Leleu
E Tilley-Classey
A Kijkanakorn
(Appointed 25 May 2022)
R Widman
(Appointed 25 May 2022)
R Wiegmann
A Grahame
(Resigned 21 February 2022)
L Myter
(Resigned 21 February 2022)
J Tourbier
(Resigned 21 February 2022)
D Koetser
(Appointed 25 May 2022)
M Rinck
(Appointed 1 November 2022)
Auditor

In accordance with the company's articles, a resolution proposing that Perrys Audit Limited be reappointed as auditor of the company will be put at a General Meeting.

Strategic report

The company's exposure to risks and likely future developments are included within the strategic report on page 1.

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.

SMALL LUXURY HOTELS OF THE WORLD LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 4 -
On behalf of the board
S Leleu
Director
2 October 2023
SMALL LUXURY HOTELS OF THE WORLD LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 5 -

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:

 

 

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.

SMALL LUXURY HOTELS OF THE WORLD LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2022
- 6 -
2022
2021
Notes
£
£
Turnover
3
20,048,670
10,253,180
Cost of sales
(11,736,029)
(6,142,103)
Gross profit
8,312,641
4,111,077
Administrative expenses
(6,179,523)
(5,773,381)
Profit/(loss) before taxation
2,133,118
(1,662,304)
Tax on profit/(loss)
7
-
0
-
0
Profit/(loss) for the financial year
2,133,118
(1,662,304)

The profit and loss account has been prepared on the basis that all operations are continuing operations.

SMALL LUXURY HOTELS OF THE WORLD LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2022
- 7 -
2022
2021
£
£
Profit/(loss) for the year
2,133,118
(1,662,304)
Other comprehensive income
-
-
Total comprehensive income for the year
2,133,118
(1,662,304)
SMALL LUXURY HOTELS OF THE WORLD LIMITED (REGISTERED NUMBER: 10122910)
BALANCE SHEET
AS AT
31 DECEMBER 2022
31 December 2022
- 8 -
2022
2021
Notes
£
£
£
£
Current assets
Debtors
9
4,073,400
7,147,649
Cash at bank and in hand
10,807,287
3,223,623
14,880,687
10,371,272
Creditors: amounts falling due within one year
10
(10,557,058)
(8,180,761)
Net current assets
4,323,629
2,190,511
Capital and reserves
Called up share capital
11
10,000
10,000
Share premium account
5,990,000
5,990,000
Merger reserve
2,075,000
2,075,000
Profit and loss reserves
(3,751,371)
(5,884,489)
Total equity
4,323,629
2,190,511
The financial statements were approved by the board of directors and authorised for issue on 2 October 2023 and are signed on its behalf by:
S Leleu
Director
SMALL LUXURY HOTELS OF THE WORLD LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022
- 9 -
Share capital
Share premium account
Merger reserve
Profit and loss reserves
Total
£
£
£
£
£
Balance at 1 January 2021
10,000
5,990,000
2,075,000
(4,222,185)
3,852,815
Year ended 31 December 2021:
Loss and total comprehensive income for the year
-
-
-
(1,662,304)
(1,662,304)
Balance at 31 December 2021
10,000
5,990,000
2,075,000
(5,884,489)
2,190,511
Year ended 31 December 2022:
Profit and total comprehensive income for the year
-
-
-
2,133,118
2,133,118
Balance at 31 December 2022
10,000
5,990,000
2,075,000
(3,751,371)
4,323,629
SMALL LUXURY HOTELS OF THE WORLD LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
- 10 -
1
Accounting policies
Company information

Small Luxury Hotels of the World Limited is a private company limited by shares incorporated in England and Wales. The registered office is 7 Howick Place, London, SW1P 1BB.

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 amounts in these financial statements are rounded to the nearest £1.

The financial statements have been prepared under the historical cost convention.

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. The company has therefore taken advantage of exemptions from the following disclosure requirements:

 

 

The financial statements of the company are consolidated in the financial statements of Hotel Investment Partners Limited. These consolidated financial statements are available from its registered office, 2nd Floor, 7 Howick Place, London, SW1P 1BB.

1.2
Going concern

The company has been affected by the Covid-19 global pandemic and its economic impact.

 

The company has reviewed its results from 1 January 2023 to date, and its forecasts for 2024. The company still provides services to hotels around the world and will continue to rigorously monitor its costs and cashflows accordingly.

 

Furthermore, the parent company of the group has received an injection of capital amounting to £13.7m in 2022.

 

The directors confirm that having reviewed the company's cash requirements for a period of more than 12 months from the date of signing these financial statements, they have a reasonable expectation that the company has adequate resources available to it to continue in operational existence and meet its liabilities as and when they fall due. The directors accordingly adopted the going concern basis in preparing these financial statements.

 

 

SMALL LUXURY HOTELS OF THE WORLD LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 11 -
1.3
Turnover

Turnover is measured at the fair value of the consideration received or receivable and represents the amount receivable for goods supplied or services rendered, net of returns, discounts and rebates allowed by the Company and value added taxes. The Company recognises turnover when (a) the significant risks and rewards of ownership have been transferred to the buyer; (b) the Company retains no continuing involvement or control over the goods; (c) the amount of turnover can be measured reliably; (d) it is probable that future economic benefits will flow to

the entity and (e) when the specific criteria relating to the each of Company’s sales channels have been met, as described below.

 

Turnover represents annual membership fees, commissions on reservations receivable and fees for other services all rendered to member hotels, net of value added tax and trade discounts.

 

Annual membership fees are recognised evenly over the year of membership.

 

Commissions on reservation income receivable from member hotels are recognised on guest’s scheduled departure via the Company’s reservation system. An allowance is made against all bookings representing the estimated level of cancellations due to the higher level of cancellations during the pandemic this is currently 10% against the normal 5%.

 

Accrued income represents services provided to member hotels not invoiced at the reporting date.

 

Deferred income represents amounts invoiced relating to revenue in subsequent years.

 

1.4
Intangible fixed assets other than goodwill

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.

Amortisation 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:

slh.com Website Code & Design
Fully amortised

Amortisation is included in ‘administrative expenses’ in the profit and loss account. Where factors, such as technological advancement or changes in market price, indicate that residual value or useful life have changed, the residual value, useful life or amortisation rate are amended prospectively to reflect the new circumstances. The assets are reviewed for impairment if the above factors indicate that the carrying amount may be impaired. Costs associated with maintaining slh.com is recognised as an expense as incurred.

1.5
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.

SMALL LUXURY HOTELS OF THE WORLD LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 12 -
1.6
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.

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.

SMALL LUXURY HOTELS OF THE WORLD LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
1
Accounting policies
(Continued)
- 13 -
Basic financial liabilities

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares 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 payments 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. Amounts 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.

Derecognition of financial liabilities

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

1.7
Foreign exchange

(i) Functional and presentation currency

 

The Company’s functional and presentation currency is the pound sterling.

 

(ii) 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 year 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 year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the comprehensive income.

 

Foreign exchange gains and losses that relate to cash and cash equivalents are presented in the comprehensive income within ‘Administrative expenses.

 

 

SMALL LUXURY HOTELS OF THE WORLD LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
- 14 -
2
Judgements and key sources of estimation uncertainty

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the application of the accounting policies and the reported amounts of assets and liabilities, revenue and expenses. These include estimating levels of slippage for reservations. Estimates for the volume and value of reservations are made and then re-evaluated throughout the year and the estimates are made on the number of hotels both joining and leaving the brand. Actual results may differ from these estimates.

 

Estimates and underlying assumptions are continually evaluated and are based on historical experience and other factors, including expectations of future events that are reasonable under the circumstances. Revisions to accounting estimates are recognised in the year in which the estimates are revised and in any future years affected.

3
Turnover
2022
2021
£
£
Turnover analysed by class of business
Hotel fees, inspections and event income
14,316,274
7,570,181
Reservations commissions
5,732,396
2,682,999
20,048,670
10,253,180
4
Operating profit/(loss)
2022
2021
Operating profit/(loss) for the year is stated after charging:
£
£
Exchange losses
340,131
49,665
Fees payable to the company's auditor for the audit of the company's financial statements
10,800
10,250
Amortisation of intangible assets
-
1,153,438
5
Auditor's remuneration
2022
2021
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
10,800
10,250
6
Employees

The company had 0 employees during the year (2021: 0).

7
Taxation
SMALL LUXURY HOTELS OF THE WORLD LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
7
Taxation
(Continued)
- 15 -

The actual charge for the year can be reconciled to the expected charge/(credit) for the year based on the profit or loss and the standard rate of tax as follows:

2022
2021
£
£
Profit/(loss) before taxation
2,133,118
(1,662,304)
Expected tax charge/(credit) based on the standard rate of corporation tax in the UK of 19.00% (2021: 19.00%)
405,292
(315,838)
Tax effect of expenses that are not deductible in determining taxable profit
-
0
5,638
Tax effect of utilisation of tax losses not previously recognised
(405,292)
-
0
Unutilised tax losses carried forward
-
0
34,143
Group relief
-
0
276,057
Taxation charge for the year
-
-
8
Intangible fixed assets
slh.com Website Code & Design
£
Cost
At 1 January 2022 and 31 December 2022
1,523,126
Amortisation and impairment
At 1 January 2022 and 31 December 2022
1,523,126
Carrying amount
At 31 December 2022
-
0
At 31 December 2021
-
0
9
Debtors
2022
2021
Amounts falling due within one year:
£
£
Trade debtors
1,511,338
4,971,421
Other debtors
1,442,474
1,112,235
Prepayments and accrued income
1,119,588
1,063,993
4,073,400
7,147,649
SMALL LUXURY HOTELS OF THE WORLD LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
9
Debtors
(Continued)
- 16 -

The provision against trade debtors for the year was £1,666,163 (2021: £2,473,490). The figure above shows the net balance.

10
Creditors: amounts falling due within one year
2022
2021
£
£
Trade creditors
4,240,008
2,902,987
Other creditors
5,444,779
5,097,773
Accruals and deferred income
872,271
180,001
10,557,058
8,180,761
11
Share capital
2022
2021
2022
2021
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
10,000
10,000
10,000
10,000
12
Related party transactions

During the year the company incurred recharged expenses of £617k (2021: £446k) from a company with common directors. At the balance sheet date, the company owed £358k (2021: £1.6m) to the company with common directors.

 

The company has taken advantage of the exemption contained in FRS 102 paragraph 33.1A and has not disclosed details of transactions with other wholly owned group companies.

 

13
Ultimate controlling party

The immediate parent company is Small Luxury Hotels of the World Management Limited.

 

The ultimate parent company is Hotel Investment Partners Limited.

 

The ultimate controlling party is the Imperial Kensington Trust.

SMALL LUXURY HOTELS OF THE WORLD LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF SMALL LUXURY HOTELS OF THE WORLD LIMITED
- 17 -
Opinion

We have audited the financial statements of Small Luxury Hotels of the World Limited (the 'company') for the year ended 31 December 2022 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 significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 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:

Basis for opinion

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

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

 

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

 

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

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 contained within the annual report. 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. 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 course of 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 this gives rise to a material misstatement in the financial statements themselves. 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.

SMALL LUXURY HOTELS OF THE WORLD LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SMALL LUXURY HOTELS OF THE WORLD LIMITED
- 18 -

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of our audit:

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 identified material misstatements in the strategic report or the directors' report. We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

 

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, 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.

SMALL LUXURY HOTELS OF THE WORLD LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SMALL LUXURY HOTELS OF THE WORLD LIMITED
- 19 -

The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

 

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

 

We gained an understanding of the legal and regulatory framework applicable to the company and the industry in which it operates, and considered the risk of acts by the company that were contrary to applicable laws and regulations, including fraud.

 

We designed audit procedures to respond to the risk, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion.

 

We focused on laws and regulations which could give rise to a material misstatement in the financial statements, including, but not limited to, the Companies Act 2006 and UK tax legislation. Our tests included agreeing the financial statement disclosures to underlying supporting documentation and enquiries with management.

 

We did not identify any key audit matters relating to irregularities, including fraud. As in all our audits, we also addressed the risk of management override of internal controls, including testing journals and evaluating whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Use of our report

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.

Declan McCusker (Senior Statutory Auditor)
For and on behalf of Perrys Audit Limited
Chartered Accountants
Statutory Auditor
4th Floor
399-401 Strand
London
WC2R 0LT
3 October 2023
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