Company registration number 04046728 (England and Wales)
IVY COTTAGE (ACKTON) LTD
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
IVY COTTAGE (ACKTON) LTD
COMPANY INFORMATION
Directors
Mr R J Slingsby
Mr J G Sykes
Mr J M Heaphy
Ms C M Lee
Company number
04046728
Registered office
Littleworth Lane
Lundwood
Barnsley
South Yorkshire
England
S71 5RG
Auditor
HSKSG Audit
3rd Floor
Butt Dyke House
33 Park Row
Nottingham
NG1 6EE
IVY COTTAGE (ACKTON) LTD
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditor's report
5 - 7
Income statement
8
Statement of comprehensive income
9
Statement of financial position
10
Statement of changes in equity
11
Statement of cash flows
12
Notes to the financial statements
13 - 23
IVY COTTAGE (ACKTON) LTD
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 1 -

The directors present the strategic report for the year ended 31 March 2023.

Review of the business

The principal activity of the company is the provision of specialist residential support and care for adults with learning disabilities and complex needs. Support and care is provided to service users from within eight homes across four registered locations in South and West Yorkshire with a total current capacity of 64 beds.

 

The ethos of the business is based on the principle that the service users are the priority and that the provision of high-quality care and support is key in enabling them and supporting them to develop to lead as an independent and normal life as possible. This approach has proved successful with high occupancy rates, good CQC ratings and excellent relationships with commissioning bodies.

 

The ongoing strategy is to develop from this sound base with a controlled expansion plan, increasing capacity in carefully selected locations working closely with the local authorities in conjunction with exploring entry into supported living to offer certain service users their next stage of independence.

 

Covid 19 still has an impact on the business and the directors would like to acknowledge the efforts of all staff in ensuring that levels of care are maintained, and service users are kept as safe as possible during ongoing outbreaks. As a provider we ensure we comply with all current guidance issued by Gov.uk and local prevention guidance teams (IPC).

 

The company is a wholly owned subsidiary of Curve Capital Holdings Limited.

Principal risks and uncertainties

Finance and Operational Risk

 

The delivery of high-quality care is dependent on the funding of appropriate care packages with local authorities and other government bodies that may be subject to additional financial constraint as a consequence of fiscal policies implemented by Central Government to manage the budget deficit.

 

Operationally, the Covid-19 pandemic presented a much-reduced risk. Inflationary pressures particularly in relation to wage rates and utility costs have impacted on the cost base of the company. Shortage of labour continues to present operational challenges which are being managed effectively.

 

 

Legislative and regulatory risk

 

The market is governed by quality standards and all of the company's services are monitored by the Care Quality Commission (CQC), specialist departments and local authorities. Failure to meet the necessary standards could put the business at significant risk. The company has systems in place to monitor standards in each of the care locations which include regular audits carried out internally and by an external organisation.

 

 

Labour and recruitment

 

Securing high quality staff is critical to the delivery of care and there have been significant challenges in increasing staff numbers due to competitive pressures in the employment market, Brexit factors and the legacy impact of the Covid-19 pandemic on the attractiveness of the sector for prospective employees. This has resulted in a higher than anticipated use of temporary agency staff. The company strives to be proactive and creative in its strategy to recruit and retain staff. We remunerate our staff members at rates higher than the national living wage, increasing hourly rates for weekend and night working. We have expanded our internal HR team to support staff to invest further in training and to increase recruitment.

 

IVY COTTAGE (ACKTON) LTD
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 2 -
Development and performance

The results of the business are set out within these accounts.

 

Turnover has increased in the current year to £7,224,741 (2022: £6,768,330) due to a combination of fee uplifts to cover additional costs relating to the national minimum wage as well as the higher care needs of existing and new service users.

 

The company reviews profit performance of the business using the EBITDA measure (Earnings Before Interest, Tax, Depreciation and Amortisation). EBITDA for the current year was £2,026,795 (2022: £2,124,829).

 

The company has acquired a new site and has obtained planning permission to develop a six-bedroom residential facility in a new location. Extensive investment has been undertaken to create a high-quality facility and an application for CQC registration has been submitted. It is anticipated to be operational in the early part of next year with full occupancy achieved by mid-2024 increasing the total capacity of the organisation to 70 beds.

 

This is consistent with the strategy to offer smaller facilities embedded within the local community. Further suitable locations have already been identified and strategic conversations are occurring with relevant authorities to ensure demand.

 

Key performance indicators

The directors monitor the progress of the business by reference to key performance indicators which include occupancy, CQC ratings, turnover and EBITDA as referenced above.

 

Occupancy levels are measured on a monthly basis. The average occupancy during the year under review was 98.1% (2022: 98.2%).

 

Direct wage costs (including temporary staff costs) as a proportion of weekly fees and contributions to care is also taken as a key measure. This increased to 60.35% in the current year (2022: 58.14%) and such a significant proportion reflects the staff numbers needed to meet and maintain the quality of care required and to support the development of the business.

 

The company operates in a regulated environment and, as a consequence, the relevant CQC ratings represent a key performance indicator. All locations are rated overall "good."

 

The company has clear action plans in place to maintain and further enhance the quality of care across all locations.

 

 

On behalf of the board

Mr R J Slingsby
Director
12 October 2023
IVY COTTAGE (ACKTON) LTD
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 3 -

The directors present their annual report and financial statements for the year ended 31 March 2023.

Principal activities

The principal activity of the company continued to be that of the provision of specialist residential support and care for adults with learning disabilities and complex needs.

Results and dividends

The results for the year are set out on page 8.

Ordinary dividends were paid amounting to £750,000. 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:

Mr R J Slingsby
Mr J G Sykes
Mr J M Heaphy
Ms C M Lee
Statement of directors' responsibilities

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.

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.

IVY COTTAGE (ACKTON) LTD
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 4 -
On behalf of the board
Mr R J Slingsby
Director
12 October 2023
IVY COTTAGE (ACKTON) LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF IVY COTTAGE (ACKTON) LTD
- 5 -
Opinion

We have audited the financial statements of Ivy Cottage (Ackton) Ltd (the 'company') for the year ended 31 March 2023 which comprise the income statement, the statement of comprehensive income, the statement of financial position, the statement of changes in equity, the statement of cash flows 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.

Opinions on other matters prescribed by the Companies Act 2006

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

IVY COTTAGE (ACKTON) LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF IVY COTTAGE (ACKTON) LTD
- 6 -
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.

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

We considered the nature of the company's business and its control environment. We also enquired of management about their identification and assessment of the risks of irregularities.

 

We obtained an understanding of the legal and regulatory framework in which the company operates and identified key laws and regulations that:

 

- Had a direct effect on the determination of material amounts and disclosures in the financial statements, which included the Companies Act 2006, tax legislation and payroll legislation; and

 

- Did not have a direct effect on the financial statements but compliance with which may be fundamental to the company's ability to operate.

 

We discussed among the audit engagement team the opportunities and incentives that may exist within the organisation for fraud and how / where fraud might occur in the financial statements.

IVY COTTAGE (ACKTON) LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF IVY COTTAGE (ACKTON) LTD
- 7 -

In common with all audits under ISA's (UK), we are also required to perform specific procedures to respond to the risk of management override. In addressing the risk of fraud through management override of controls, we tested the appropriateness of accounting adjustments and journal entries, assessed whether accounting estimates were reasonable and accurate and reviewed the accounting records for any significant and unusual transactions.

 

In addition, our procedures to respond to the risks identified included:

- Reviewing financial statement disclosures by testing to supporting documentation to assess compliance with provision of relevant laws and regulations described as having a direct effect on the financial statements;

- Performing analytical procedures to identify any unusual or unexpected variances that may indicate risks of material misstatement due to fraud;

- Enquiring of management about any instances of non-compliance with laws and regulations and any instances of known or suspected fraud; and

- Reviewing the latest available Care Quality Commission inspection reports for all registered homes operated by the subsidiary.

 

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.

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.

Philip Handley FCA
Senior Statutory Auditor
For and on behalf of HSKSG Audit
12 October 2023
Chartered Accountants
Statutory Auditor
3rd Floor
Butt Dyke House
33 Park Row
Nottingham
NG1 6EE
IVY COTTAGE (ACKTON) LTD
INCOME STATEMENT
FOR THE YEAR ENDED 31 MARCH 2023
- 8 -
2023
2022
Notes
£
£
Turnover
3
7,224,741
6,768,330
Cost of sales
(154,756)
(148,153)
Gross profit
7,069,985
6,620,177
Administrative expenses
(5,156,375)
(4,675,479)
Other operating income
38,513
106,778
Operating profit
4
1,952,123
2,051,476
Interest receivable and similar income
7
362
463
Interest payable and similar expenses
8
-
0
(429)
Profit before taxation
1,952,485
2,051,510
Tax on profit
9
(315,187)
(393,833)
Profit for the financial year
1,637,298
1,657,677

 

IVY COTTAGE (ACKTON) LTD
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2023
- 9 -
2023
2022
£
£
Profit for the year
1,637,298
1,657,677
Other comprehensive income
-
-
Total comprehensive income for the year
1,637,298
1,657,677
IVY COTTAGE (ACKTON) LTD
STATEMENT OF FINANCIAL POSITION
AS AT
31 MARCH 2023
31 March 2023
- 10 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
11
4,799,924
4,454,633
Current assets
Debtors
12
5,178,806
5,286,985
Cash at bank and in hand
657,927
86,684
5,836,733
5,373,669
Creditors: amounts falling due within one year
13
(763,982)
(850,301)
Net current assets
5,072,751
4,523,368
Total assets less current liabilities
9,872,675
8,978,001
Provisions for liabilities
Deferred tax liability
14
132,883
125,507
(132,883)
(125,507)
Net assets
9,739,792
8,852,494
Capital and reserves
Called up share capital
16
100
100
Profit and loss reserves
9,739,692
8,852,394
Total equity
9,739,792
8,852,494
The financial statements were approved by the board of directors and authorised for issue on 12 October 2023 and are signed on its behalf by:
Mr R J Slingsby
Director
Company Registration No. 04046728
IVY COTTAGE (ACKTON) LTD
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
- 11 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 April 2021
100
7,469,717
7,469,817
Year ended 31 March 2022:
Profit and total comprehensive income for the year
-
1,657,677
1,657,677
Dividends
10
-
(275,000)
(275,000)
Balance at 31 March 2022
100
8,852,394
8,852,494
Year ended 31 March 2023:
Profit and total comprehensive income for the year
-
1,637,298
1,637,298
Dividends
10
-
(750,000)
(750,000)
Balance at 31 March 2023
100
9,739,692
9,739,792
IVY COTTAGE (ACKTON) LTD
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2023
- 12 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
19
2,077,746
313,038
Interest paid
-
0
(429)
Income taxes paid
(336,902)
(325,463)
Net cash inflow/(outflow) from operating activities
1,740,844
(12,854)
Investing activities
Purchase of tangible fixed assets
(419,963)
(34,650)
Proceeds from disposal of tangible fixed assets
-
0
3,888
Interest received
362
463
Net cash used in investing activities
(419,601)
(30,299)
Financing activities
Dividends paid
(750,000)
(275,000)
Net cash used in financing activities
(750,000)
(275,000)
Net increase/(decrease) in cash and cash equivalents
571,243
(318,153)
Cash and cash equivalents at beginning of year
86,684
404,837
Cash and cash equivalents at end of year
657,927
86,684
IVY COTTAGE (ACKTON) LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
- 13 -
1
Accounting policies
Company information

Ivy Cottage (Ackton) Ltd is a private company limited by shares incorporated in England and Wales. The registered office is Littleworth Lane, Lundwood, Barnsley, South Yorkshire, England, S71 5RG.

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 £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

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 Curve Capital Holdings Limited. These consolidated financial statements are available from its registered office, White Leys Broadstone Lane, Ticknall, Derby, United Kingdom, DE73 7LD.

1.2
Going concern

Atruet the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

1.3
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for 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.

The group recognises turnover when:

 

- The amount of revenue can be reliably measured;

- it is probable that future economic benefits will flow into the entity; and

- specific criteria have been met for each of the group's activities.

1.4
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.

IVY COTTAGE (ACKTON) LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 14 -

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:

Freehold land and buildings
1% on cost
Fixtures and fittings
25% on cost
Motor vehicles
25% on cost

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.

1.5
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.

Recoverable amount is the higher of fair value less costs to sell and 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.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. 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.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

1.6
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.

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 statement of financial position 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.

IVY COTTAGE (ACKTON) LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 15 -
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.

Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

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.

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.

IVY COTTAGE (ACKTON) LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 16 -
Other financial liabilities

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

 

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Derecognition of financial liabilities

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

1.8
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 income statement 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.

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 income statement, 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.

1.9
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

 

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

IVY COTTAGE (ACKTON) LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 17 -
1.10
Retirement benefits

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.11
Leases

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

1.12
Government grants

Income from government grants, whether 'capital' grants or 'revenue' grants are recognised when the company has entitlement to the funds, any performance conditions attached to the grants have been met, it is probable that the income will be received and the amount can be measured reliably.

2
Judgements and key sources of estimation uncertainty

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
Provision of services
7,224,741
6,768,330
2023
2022
£
£
Other revenue
Interest income
362
463
Grants received
38,513
106,778

Government grants relate to infection control grants and other grants following the COVID-19 pandemic.

IVY COTTAGE (ACKTON) LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 18 -
4
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Government grants
(38,513)
(106,778)
Fees payable to the company's auditor for the audit of the company's financial statements
6,462
7,090
Depreciation of owned tangible fixed assets
74,672
74,502
Profit on disposal of tangible fixed assets
-
(1,149)
Operating lease charges
2,208
2,457
5
Employees

The average monthly number of persons (including directors) employed by the company during the year was:

2023
2022
Number
Number
Administration and support
186
197

Their aggregate remuneration comprised:

2023
2022
£
£
Wages and salaries
3,287,471
3,357,218
Social security costs
264,353
300,475
Pension costs
60,005
62,615
3,611,829
3,720,308
6
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
245,464
247,538
Company pension contributions to defined contribution schemes
5,973
5,916
251,437
253,454

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 3 (2022 - 3).

IVY COTTAGE (ACKTON) LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
6
Directors' remuneration
(Continued)
- 19 -
Remuneration disclosed above include the following amounts paid to the highest paid director:
2023
2022
£
£
Remuneration for qualifying services
137,839
133,824
Company pension contributions to defined contribution schemes
2,201
2,201
7
Interest receivable and similar income
2023
2022
£
£
Interest income
Other interest income
362
463
8
Interest payable and similar expenses
2023
2022
£
£
Other interest
-
0
429
9
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
307,811
350,291
Adjustments in respect of prior periods
-
0
8,155
Total current tax
307,811
358,446
Deferred tax
Origination and reversal of timing differences
7,376
35,387
Total tax charge
315,187
393,833
IVY COTTAGE (ACKTON) LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
9
Taxation
(Continued)
- 20 -

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

2023
2022
£
£
Profit before taxation
1,952,485
2,051,510
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2022: 19.00%)
370,972
389,787
Tax effect of expenses that are not deductible in determining taxable profit
(189)
1,361
Adjustments in respect of prior years
-
0
8,155
Effect of change in corporation tax rate
-
0
28,458
Group relief
(65,645)
(39,203)
Permanent capital allowances in excess of depreciation
10,049
(218)
Timing differences
-
0
5,493
Taxation charge for the year
315,187
393,833
10
Dividends
2023
2022
£
£
Interim paid
750,000
275,000
11
Tangible fixed assets
Freehold land and buildings
Assets under construction
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 April 2022
4,754,283
-
0
438,000
52,309
5,244,592
Additions
369,268
34,070
16,625
-
0
419,963
At 31 March 2023
5,123,551
34,070
454,625
52,309
5,664,555
Depreciation and impairment
At 1 April 2022
364,335
-
0
396,867
28,757
789,959
Depreciation charged in the year
50,309
-
0
16,362
8,001
74,672
At 31 March 2023
414,644
-
0
413,229
36,758
864,631
Carrying amount
At 31 March 2023
4,708,907
34,070
41,396
15,551
4,799,924
At 31 March 2022
4,389,948
-
0
41,133
23,552
4,454,633
IVY COTTAGE (ACKTON) LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
11
Tangible fixed assets
(Continued)
- 21 -

Included within the net book value of freehold land and buildings above is £175,092 (2022: £176,992) in respect of land.

 

Freehold land and buildings with a carrying value of £4,708,907 (2022: £4,389,948) is pledged as security for the parent company, Curve Capital Holdings Limited's bank borrowings.

12
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
473,899
241,755
Amounts owed by group undertakings
4,653,908
4,990,140
Other debtors
-
0
256
Prepayments and accrued income
50,999
54,834
5,178,806
5,286,985
13
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
164,936
142,155
Corporation tax
118,798
147,889
Other taxation and social security
66,732
96,388
Other creditors
57,106
124,990
Accruals and deferred income
356,410
338,879
763,982
850,301
14
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:

Liabilities
Liabilities
2023
2022
Balances:
£
£
Accelerated capital allowances
132,883
125,507
IVY COTTAGE (ACKTON) LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
14
Deferred taxation
(Continued)
- 22 -
2023
Movements in the year:
£
Liability at 1 April 2022
125,507
Charge to profit or loss
7,376
Liability at 31 March 2023
132,883
15
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
60,005
62,615

The company operates a defined contribution pension scheme for all qualifying employees.

 

Contributions totalling £28,302 (2022: £33,132) were payable to the scheme at the end of the year and are included in creditors.

16
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
100
100
100
100
17
Operating lease commitments
Lessee

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

2023
2022
£
£
Within one year
2,163
1,622
Between two and five years
541
2,704
2,704
4,326
IVY COTTAGE (ACKTON) LTD
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 23 -
18
Ultimate controlling party

The ultimate parent undertaking is Curve Capital Holdings Limited by virtue of its majority shareholding of the issued ordinary share capital. The registered office is White Leys, Broadstone Lane, Ticknall, Derby, DE73 7LD.

 

The directors, C M Lee, J M Heaphy, R J Slingsby and J G Sykes, control the company by virtue of their controlling interest in the issued share capital of Curve Capital Holdings Limited, although no one director has individual control of the company.

 

Copies of the group accounts for Curve Capital Holdings Limited are available from Companies House. This is the only group that the company is consolidated into for the year.

19
Cash generated from operations
2023
2022
£
£
Profit for the year after tax
1,637,298
1,657,677
Adjustments for:
Taxation charged
315,187
393,833
Finance costs
-
0
429
Investment income
(362)
(463)
Gain on disposal of tangible fixed assets
-
(1,149)
Depreciation and impairment of tangible fixed assets
74,672
74,502
Movements in working capital:
Decrease/(increase) in debtors
108,179
(1,804,330)
Decrease in creditors
(57,228)
(7,461)
Cash generated from operations
2,077,746
313,038
20
Analysis of changes in net funds
1 April 2022
Cash flows
31 March 2023
£
£
£
Cash at bank and in hand
86,684
571,243
657,927
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