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Registration number: 02731058

Rivergreen Developments PLC

Annual Report and Financial Statements

for the Year Ended 31 October 2022

 

Rivergreen Developments PLC

Contents

Company Information

1

Strategic Report

2

Directors' Report

3 to 4

Statement of Directors' Responsibilities

5

Independent Auditor's Report

6 to 8

Income Statement

9

Statement of Financial Position

10

Statement of Changes in Equity

11

Statement of Cash Flows

12

Notes to the Financial Statements

13 to 26

 

Rivergreen Developments PLC

Company Information

Directors

P A Ganley

P H Candler

M I Candler

Company secretary

J C Candler

Registered office

The Farm House & Byre
Aykley Heads Farm
Aykley Heads
Durham
DH1 5AN

Auditor

Azets Audit Services
Chartered Accountants & Statutory Auditor
Bulman House
Regent Centre
Gosforth
Newcastle upon Tyne
NE3 3LS

 

Rivergreen Developments PLC

Strategic Report for the Year Ended 31 October 2022

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

Principal activity

The principal activities of the company throughout the year continued to be those of property development, investment and project management.

Fair review of the business

Turnover decreased to £100,245 (2021 - £1,812,710) during the period and the operating loss was £324,534 (2021 - £365,589).

Exceptional administrative expenses during the period amounted to £168,723 (2021 - £108,745) relating to doubtful debt provisions made against related party balances.

The overall loss before tax was £257,280. Excluding the impact of the exceptional impairment of the related party balances the company would have reported a loss of £88,557.

Marketing of the unlet unit at the Rivergreen Centre in Hartlepool continued throughout the period.

The company is open to new development opportunities and continues to generate rental income from its units in Hartlepool.

Financial KPI's
As part of its continuous improvement and quality programme, the company monitors a range of key performance indicators and the directors are pleased to comment on a number of these as follows:

 

Unit

2022

2021

Gross profit margin

%

79.52

5.41

Principal risks and uncertainties

The principal risks identified by the management team to meet the long-term strategy are in relation to employee retention, interest rates and liquidity. The company is continuing to monitor these risks and develop safeguards in order to sufficiently aide with the growth plans.

Approved and authorised for issue by the Board on 26 October 2023 and signed on its behalf by:
 

.........................................
P A Ganley
Director

 

Rivergreen Developments PLC

Directors' Report for the Year Ended 31 October 2022

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

Directors of the company

The directors who held office during the year were as follows:

P A Ganley

P H Candler

M I Candler

Financial instruments

Objectives and policies

The company finances its activities with a combination of intercompany loans, cash and short term deposits. Overdrafts are used to satisfy short term cash flow requirements. Other financial assets and liabilities, such as trade debtors and trade creditors, arise directly from the company's operating activities.

Price risk, credit risk, liquidity risk and cash flow risk

Credit risk
Credit risk is the risk that one party of a financial instrument will cause a financial loss for the other party by failing to discharge its obligation. Company policies are aimed at minimising such losses and require customers to satisfy credit worthiness procedures prior to acceptance of contracts. The company also utilises insurance policies to protect against non-payment of debt. The company does not consider that it is materially exposed to credit risk.

Cash flow and liquidity risk
Cash flow and liquidity risk is the risk that a company's available cash will not be sufficient to meet its financial obligations. The company actively manages its cash flow position including collection of debts and timely payment of creditors. This, coupled with the strong cash position of the company is deemed sufficient to minimise the company's exposure to cash flow and liquidity risk.

Future developments

See disclosures within the Strategic Report regarding future developments of the company.

Going concern

The directors have prepared the financial statements on a going concern basis.

The company meets its day to day working capital requirements through cash generated from operations, intercompany borrowings and external borrowings.

The company has net current liabilities of £1,434,721 and net liabilities of £204,305. The period end position has been impacted by a bad debt provision against related parties and group undertakings of £168,273.

The company’s forecasts and projections for the next twelve months show that the company should be able to continue in operational existence for that period, taking into account reasonable possible changes in trading performance and from having continued group support.

 

Rivergreen Developments PLC

Directors' Report for the Year Ended 31 October 2022 (continued)

The ability of the company to continue as a going concern is reliant on the continuing support of its ultimate parent company, Rivergreen Limited and therefore expects to retain sufficient financial resources to continue meeting its liabilities as they fall due.

Rivergreen Limited has confirmed it is their intention to support the company for a period of at least twelve months from the date of approval of these financial statements.

On the basis that group support has been obtained, the directors believe they are well placed to manage its business risks, and are satisfied that there is no material uncertainty in relation to going concern and it therefore remains appropriate to adopt the going concern basis in preparing its financial statements.

Important non adjusting events after the financial period

Subsequent to the balance sheet date an Atom Bank loan was partially redeemed and the remaining balance was refinanced for an additional five years. As a result the final repayment date is now 22 August 2028.

Subsequent to the balance sheet date the fully provided for debts due from Hotel Operations Limited and Jesmond Dene House Limited were formally written off in full with no recovery.

Disclosure of information to the auditor

Each director has taken steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditors are aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditors are unaware.

Reappointment of auditor

Azets Audit Services Limited, trading as Azets Audit Services, were appointed auditor to the company following their acquisition of the trade of Tait Walker LLP, trading as MHA Tait Walker, on 1 May 2022.

In accordance with section 485 of the Companies Act 2006, a resolution for the re-appointment of Azets Audit Services as auditors of the company is to be proposed at the forthcoming Annual General Meeting.

Approved and authorised for issue by the Board on 26 October 2023 and signed on its behalf by:
 

.........................................
P A Ganley
Director

 

Rivergreen Developments PLC

Statement of Directors' Responsibilities

The directors acknowledge their responsibilities 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:

select suitable accounting policies and apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

state whether applicable United Kingdom Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

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.

 

Rivergreen Developments PLC

Independent Auditor's Report to the Members of Rivergreen Developments PLC

Opinion

We have audited the financial statements of Rivergreen Developments PLC (the 'company') for the year ended 31 October 2022, which comprise the Income Statement, Statement of Financial Position, Statement of Changes in Equity, 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:

give a true and fair view of the state of the company's affairs as at 31 October 2022 and of its profit for the year then ended;

have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

have been prepared in accordance with the requirements of the Companies Act 2006.

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 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 director's 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.

 

Rivergreen Developments PLC

Independent Auditor's Report to the Members of Rivergreen Developments PLC (continued)

Opinions on other matters prescribed by the Companies Act 2006

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

the information given in the Strategic Report and Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

the Strategic Report and Directors' Report have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of our 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 and 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:

adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

the financial statements are not in agreement with the accounting records and returns; or

certain disclosures of directors' remuneration specified by law are not made; or

we have not received all the information and explanations we require for our audit.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities [set out on page 5], 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 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.

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:

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

challenging assumptions and judgements made by management in their significant accounting estimates;

 

Rivergreen Developments PLC

Independent Auditor's Report to the Members of Rivergreen Developments PLC (continued)

auditing the risk of management override of controls, including through testing journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for bias; and

reviewing financial statement disclosures and testing to support documentation.

Because of the field in which the client operates, we identified the following areas as those most likely to have a material impact on the financial statements: Health and Safety; employment law (including the Working Time Directive); and compliance with the UK Companies Act.

Owing to the inherent limitations of an audit, there is an unavoidable risk that some material misstatements in the financial statements may not be detected, even though the audit is properly planned and performed in accordance with the ISAs (UK). For instance, the further removed non-compliance is from the events and transactions reflected in the financial statements, the less likely the auditor is to become aware of it or to recognise the non-compliance.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: 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.

......................................
Brian Laidlaw BA CA (Senior Statutory Auditor)
For and on behalf of Azets Audit Services
Statutory Auditor
Chartered Accountants
Bulman House
Regent Centre
Gosforth
Newcastle upon Tyne
NE3 3LS

27 October 2023

Azets Audit Services is a trading name of Azets Audit Services Limited

 

Rivergreen Developments PLC

Income Statement for the Year Ended 31 October 2022

Note

1 November 2021 to
31 October
2022
£

1 May 2020 to
31 October
2021
£

Turnover

3

100,245

1,812,710

Cost of sales

 

(20,530)

(1,714,575)

Gross profit

 

79,715

98,135

Administrative expenses

 

(235,976)

(445,644)

Exceptional administrative expenses

6

(168,273)

(108,745)

Other operating income

4

-

90,665

Operating loss

5

(324,534)

(365,589)

Other interest receivable and similar income

7

96,753

108,745

Interest payable and similar expenses

8

(29,499)

(29,083)

Loss before tax

 

(257,280)

(285,927)

Taxation

12

341,393

268,861

Profit/(loss) for the financial year

 

84,113

(17,066)

The above results were derived from continuing operations.

The company has no recognised gains or losses for the year other than the results above.

 

Rivergreen Developments PLC

(Registration number: 02731058)
Statement of Financial Position as at 31 October 2022

Note

31 October
2022
£

31 October
2021
£

Fixed assets

 

Tangible assets

13

16,011

21,067

Investment property

14

1,214,405

1,214,405

 

1,230,416

1,235,472

Current assets

 

Debtors

15

638,997

967,661

Cash at bank and in hand

 

73,311

444,622

 

712,308

1,412,283

Creditors: Amounts falling due within one year

16

(2,147,029)

(2,386,088)

Net current liabilities

 

(1,434,721)

(973,805)

Total assets less current liabilities

 

(204,305)

261,667

Creditors: Amounts falling due after more than one year

16

-

(550,085)

Net liabilities

 

(204,305)

(288,418)

Capital and reserves

 

Called up share capital

19

50,000

50,000

Profit and loss account

20

(254,305)

(338,418)

Total equity

 

(204,305)

(288,418)

Approved and authorised for issue by the Board on 26 October 2023 and signed on its behalf by:
 

.........................................
P A Ganley
Director

 

Rivergreen Developments PLC

Statement of Changes in Equity for the Year Ended 31 October 2022

Share capital
£

Profit and loss account
£

Total
£

At 1 May 2020

50,000

(321,352)

(271,352)

Loss for the period

-

(17,066)

(17,066)

Total comprehensive income

-

(17,066)

(17,066)

At 31 October 2021

50,000

(338,418)

(288,418)

Share capital
£

Profit and loss account
£

Total
£

At 1 November 2021

50,000

(338,418)

(288,418)

Profit for the year

-

84,113

84,113

Total comprehensive income

-

84,113

84,113

At 31 October 2022

50,000

(254,305)

(204,305)

 

Rivergreen Developments PLC

Statement of Cash Flows for the Year Ended 31 October 2022

Note

1 November 2021 to
31 October
2022
£

1 May 2020 to
31 October
2021
£

Cash flows from operating activities

Profit/(loss) for the year

 

84,113

(17,066)

Adjustments to cash flows from non-cash items

 

Depreciation and amortisation

5

5,056

6,486

Profit on disposal of tangible assets

-

(51)

Finance income

7

(96,753)

(108,745)

Finance costs

8

29,499

29,083

Income tax expense

12

(341,393)

(268,861)

 

(319,478)

(359,154)

Working capital adjustments

 

Decrease in trade debtors

15

670,057

725,175

Decrease in trade creditors

16

(789,320)

(77,437)

Net cash flow from operating activities

 

(438,741)

288,584

Cash flows from investing activities

 

Interest received

7

96,753

108,745

Acquisitions of tangible assets

-

(2,056)

Proceeds from sale of tangible assets

 

-

1,000

Net cash flows from investing activities

 

96,753

107,689

Cash flows from financing activities

 

Interest paid

8

(29,323)

(29,375)

Net (decrease)/increase in cash and cash equivalents

 

(371,311)

366,898

Cash and cash equivalents at 1 November

 

444,622

77,724

Cash and cash equivalents at 31 October

 

73,311

444,622

 

Rivergreen Developments PLC

Notes to the Financial Statements for the Year Ended 31 October 2022

1

General information

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

The address of its registered office is The Farm House & Byre, Aykley Heads Farm, Aykley Heads, Durham, DH1 5AN.

2

Accounting policies

Summary of significant accounting policies and key accounting estimates

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

Statement of compliance

These financial statements were prepared in accordance with Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland and the Companies Act 2006'.

Basis of preparation

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

These financial statements are prepared in sterling which is the functional currency of the entity.

Going concern

The directors have prepared the financial statements on a going concern basis.

The company meets its day to day working capital requirements through cash generated from operations, intercompany borrowings and external borrowings.

The company has net current liabilities of £1,434,721 and net liabilities of £204,305. The period end position has been impacted by a bad debt provision against related parties and group undertakings of £168,273.

The company’s forecasts and projections for the next twelve months show that the company should be able to continue in operational existence for that period, taking into account reasonable possible changes in trading performance and from having continued group support.

The ability of the company to continue as a going concern is reliant on the continuing support of its ultimate parent company, Rivergreen Limited and therefore expects to retain sufficient financial resources to continue meeting its liabilities as they fall due.

Rivergreen Limited has confirmed it is their intention to support the company for a period of at least twelve months from the date of approval of these financial statements.

On the basis that group support has been obtained, the directors believe they are well placed to manage its business risks, and are satisfied that there is no material uncertainty in relation to going concern and it therefore remains appropriate to adopt the going concern basis in preparing its financial statements.

 

Rivergreen Developments PLC

Notes to the Financial Statements for the Year Ended 31 October 2022 (continued)

2

Accounting policies (continued)

Judgements

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the amounts reported. These estimates and judgements are continually reviewed and are based on experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

There are considered to be no significant judgements (apart from those involving estimations) that management has made in the process of applying the entity's accounting policies which effect the amounts recognised in the financial statements.

Key sources of estimation uncertainty

Accounting estimates and assumptions are made concerning the future and, by their nature, will rarely equal the related actual outcome. The key assumptions and other sources of estimation uncertainty that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are as follows:

Impairment of debtors - The company makes an estimate of the recoverable value of the trade and other debtors. When assessing impairment of trade and other debtor, management considers factors including the current credit rating of the debtor, the ageing profile of debtors and historical experience. The carrying amount is £168,273 (2021 - £160,817).

Revenue recognition

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

Rental income is recognised in the accounts according to the period in which the income covers with accruals and prepayments being recognised as appropriate.

Property sales are recognised on legal completion.

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

Government grants

Government grants received relating to costs incurred by the company are recognised in the income and expenditure account over the period necessary to match them with the costs that they are intended to compensate. Government grants are presented separately and disclosed in other income.

Other income in the previous period includes UK Government assistance provided through the Coronavirus Job Retention Scheme and rates relief.

Tax

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

 

Rivergreen Developments PLC

Notes to the Financial Statements for the Year Ended 31 October 2022 (continued)

2

Accounting policies (continued)

Deferred tax is recognised in respect of all timing differences between taxable profits and profits reported in the financial statements. Unrelieved tax losses and other deferred tax assets are recognised when it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing difference.

Tangible assets

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

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

Depreciation

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

 

Asset class

Depreciation method and rate

 

Plant and machinery

15% reducing balance

 

Equipment, fixtures and fittings

15% reducing balance

 

Motor vehicles

25% reducing balance

Investment property

Investment property is carried at fair value, derived from the current market prices for comparable real estate determined annually by external valuers. The valuers use observable market prices, adjusted if necessary for any difference in the nature, location or condition of the specific asset. Changes in fair value are recognised in profit or loss.

Cash and cash equivalents

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

Trade debtors

Trade debtors are amounts due from customers for merchandise sold or services performed in the ordinary course of business.

Trade debtors are recognised initially at the transaction price. They are subsequently measured at amortised cost using the effective interest method, less provision for impairment. A provision for the impairment of trade debtors is established when there is objective evidence that the company will not be able to collect all amounts due according to the original terms of the receivables.

 

Rivergreen Developments PLC

Notes to the Financial Statements for the Year Ended 31 October 2022 (continued)

2

Accounting policies (continued)

Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost is determined using the first-in, first-out (FIFO) method.

The cost of finished goods and work in progress comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the inventories to their present location and condition. At each reporting date, stocks are assessed for impairment. If stocks are impaired, the carrying amount is reduced to its selling price less costs to complete and sell; the impairment loss is recognised immediately in profit or loss.

Trade creditors

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the company does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.

Trade creditors are recognised initially at the transaction price and subsequently measured at amortised cost using the effective interest method.

Borrowings

Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale.

Provisions

Provisions are recognised when the entity has an obligation at the reporting date as a result of a past event, it is probable that the entity will be required to transfer economic benefits in settlement and the amount of the obligation can be estimated reliably. Provisions are recognised as a liability in the statement of financial position and the amount of the provision as an expense.

Provisions are initially measured at the best estimate of the amount required to settle the obligation at the reporting date and subsequently reviewed at each reporting date and adjusted to reflect the current best estimate of the amount that would be required to settle the obligation. Any adjustments to the amounts previously recognised are recognised in profit or loss unless the provision was originally recognised as part of the cost of an asset. When a provision is measured at the present value of the amount expected to be required to settle the obligation, the unwinding of the discount is recognised as a finance cost in profit or loss in the period it arises.

Leases

Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease.

 

Rivergreen Developments PLC

Notes to the Financial Statements for the Year Ended 31 October 2022 (continued)

2

Accounting policies (continued)

Share capital

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

Defined contribution pension obligation

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

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

3

Turnover

The analysis of the company's Turnover for the year from continuing operations is as follows:

1 November 2021 to
31 October
2022
£

1 May 2020 to
31 October
2021
£

Sale of goods

-

1,564,010

Rendering of services

1,232

2,173

Rental income from investment property

98,821

124,298

Other revenue

192

122,229

100,245

1,812,710

The analysis of the company's Turnover for the year by market is as follows:

1 November 2021 to
31 October
2022
£

1 May 2020 to
31 October
2021
£

UK

100,245

1,812,710

 

Rivergreen Developments PLC

Notes to the Financial Statements for the Year Ended 31 October 2022 (continued)

4

Other operating income

The analysis of the company's other operating income for the year is as follows:

Year ended 31 October 2022
 £

1 May 2020 to 31 October 2021
 £

Government grants

-

90,665

5

Operating loss

Arrived at after charging/(crediting)

1 November 2021 to
31 October
2022
£

1 May 2020 to
31 October
2021
£

Depreciation expense

5,056

6,486

Operating lease expense - plant and machinery

40

-

Profit on disposal of property, plant and equipment

-

(51)

6

Exceptional items

Year ended 31 October 2022
 £

1 May 2020 to
31 October
2021
£

Exceptional administrative expenses

168,273

108,745

The exceptional administrative expenses relate to doubtful debt provisions made against related party and fellow subsidiary loan balances following an assessment of recoverability by management.

7

Other interest receivable and similar income

1 November 2021 to
31 October
2022
£

1 May 2020 to
31 October
2021
£

Other finance income

96,753

108,745

Other interest receivable relates to interest on a loan with a related party, Hotel Operations Limited. This interest is not considered to be recoverable and as such has been included within bad debts provided for in the current and prior year respectively.

 

Rivergreen Developments PLC

Notes to the Financial Statements for the Year Ended 31 October 2022 (continued)

8

Interest payable and similar expenses

1 November 2021 to
31 October
2022
£

1 May 2020 to
31 October
2021
£

Interest on bank overdrafts and borrowings

29,210

29,083

Interest expense on other finance liabilities

289

-

29,499

29,083

9

Staff costs

The aggregate payroll costs (including directors' remuneration) were as follows:

Year ended 31 October 2022
 £

1 May 2020 to 31 October 2021
 £

Wages and salaries

228,973

478,982

Social security costs

45,947

65,804

Other short-term employee benefits

4,502

-

Pension costs, defined contribution scheme

3,605

8,943

283,027

553,729

The average number of persons employed by the company (including directors) during the year, analysed by category was as follows:

1 November 2021 to
31 October
2022
No.

1 May 2020 to
31 October
2021
No.

Administration and support

4

7

Other departments

-

3

4

10

10

Directors' remuneration

The directors' remuneration for the year was as follows:

Year ended 31 October 2022
 £

1 May 2020 to 31 October 2021
 £

Remuneration

143,961

301,689

Contributions paid to money purchase schemes

1,761

3,948

145,722

305,637

 

Rivergreen Developments PLC

Notes to the Financial Statements for the Year Ended 31 October 2022 (continued)

10

Directors' remuneration (continued)

During the year the number of directors who were receiving benefits and share incentives was as follows:

Year ended 31 October 2022
 No.

1 May 2020 to 31 October 2021
 No.

Accruing benefits under money purchase pension scheme

2

2

In respect of the highest paid director:

Year ended 31 October 2022
 £

1 May 2020 to 31 October 2021
 £

Remuneration

80,000

159,167

Company contributions to money purchase pension schemes

881

1,974

11

Auditor's remuneration

1 November 2021 to
31 October
2022
£

1 May 2020 to
31 October
2021
£

Audit of the financial statements

7,750

3,495


 

12

Taxation

Tax charged/(credited) in the income statement

1 November 2021 to
31 October
2022
£

1 May 2020 to
31 October
2021
£

Deferred taxation

Arising from origination and reversal of timing differences

(259,458)

91,157

Arising from changes in tax rates and laws

(81,935)

-

Arising from previously unrecognised tax loss, tax credit or temporary difference of prior periods

-

(360,018)

Total deferred taxation

(341,393)

(268,861)

 

Rivergreen Developments PLC

Notes to the Financial Statements for the Year Ended 31 October 2022 (continued)

12

Taxation (continued)

The tax on profit before tax for the year is lower than the standard rate of corporation tax in the UK (2021 - lower than the standard rate of corporation tax in the UK) of 19% (2021 - 19%).

The differences are reconciled below:

1 November 2021 to
31 October
2022
£

1 May 2020 to
31 October
2021
£

Loss before tax

(257,280)

(285,927)

Corporation tax at standard rate

(48,883)

(54,326)

Effect of expense not deductible in determining taxable profit (tax loss)

1,058

34,607

Deferred tax credit relating to changes in tax rates or laws

(81,935)

-

Decrease from tax losses for which no deferred tax asset was recognised

(211,633)

-

Deferred tax credit from unrecognised temporary difference from a prior period

-

(360,018)

Tax increase from effect of capital allowances and depreciation

-

16,592

Tax increase arising from group relief

-

94,284

Total tax credit

(341,393)

(268,861)

In the Spring Budget 2020, the Government announced that from 1 April 2020 the corporation tax rate would remain at 19% (rather than reducing to 17% as previously enacted). This new law was deemed substantively enacted on 17 March 2020. In the Spring Budget 2021, the Government announced that from 1 April 2023 the corporation tax rate will increase from 19% to 25%. This new law was deemed substantively enacted on 24 May 2021 and the deferred tax balances at the year end have been calculated based on this rate.

Deferred tax

Deferred tax assets and liabilities

1 November 2021 to
31 October
2022

Asset
£

Accelerated capital allowances

(46,427)

Losses

656,681

 

610,254

 

Rivergreen Developments PLC

Notes to the Financial Statements for the Year Ended 31 October 2022 (continued)

12

Taxation (continued)

1 May 2020 to
31 October
2021

Asset
£

Accelerated capital allowances

(47,464)

Losses

316,325

 

268,861

There are £Nil of unused tax losses (2021 - £1,262,063) for which no deferred tax asset is recognised in the statement of financial position.

13

Tangible assets

Fixtures and fittings
£

Plant and machinery
£

Total
£

Cost or valuation

At 1 November 2021

78,803

100,369

179,172

At 31 October 2022

78,803

100,369

179,172

Depreciation

At 1 November 2021

64,051

94,054

158,105

Charge for the year

3,635

1,421

5,056

At 31 October 2022

67,686

95,475

163,161

Carrying amount

At 31 October 2022

11,117

4,894

16,011

At 31 October 2021

14,752

6,315

21,067

14

Investment properties

£

At 1 November 2021

1,214,405

At 31 October 2022

1,214,405

 

Rivergreen Developments PLC

Notes to the Financial Statements for the Year Ended 31 October 2022 (continued)

14

Investment properties (continued)

Included within Investment properties at the year end is a commercial property.

The commercial property was valued at an open market basis by Storeys Edward Symmons LLP on 29 February 2012. Since the date of the external valuation the company has sold commercial units within the property and the valuation has been reduced accordingly for their disposal.

Taking the disposal values into consideration, the directors are of the opinion that there has been no significant change in the market value since the last external valuation.

There has been no valuation of investment property by an independent valuer during the current period.

Had investment properties been measured on a historical cost basis, the carrying value would have been £984,770 (2021 - £984,770).

15

Debtors

Note

31 October
2022
£

31 October
2021
£

Trade debtors

 

243

216

Amounts owed by group undertakings

 

-

669,854

Other debtors

 

28,500

28,730

Deferred tax assets

12

610,254

268,861

 

638,997

967,661

16

Creditors

Note

31 October 2022
 £

31 October 2021
 £

Due within one year

 

Loans and borrowings

17

550,261

-

Trade creditors

 

116,789

171,095

Amounts owed to group undertakings

23

1,453,630

2,107,661

Social security and other taxes

 

-

35,301

Other creditors

 

17,504

67,941

Accrued expenses

 

8,845

4,090

 

2,147,029

2,386,088

Due after one year

 

Loans and borrowings

17

-

550,085

 

Rivergreen Developments PLC

Notes to the Financial Statements for the Year Ended 31 October 2022 (continued)

17

Loans and borrowings

31 October 2022
 £

31 October 2021
 £

Current loans and borrowings

Bank borrowings

550,261

-

31 October 2022
 £

31 October 2021
 £

Non-current loans and borrowings

Bank borrowings

-

550,085

Bank borrowings

The Atom Bank loan is denominated in Sterling with a nominal interest rate of 4.20%, and the final instalment is due on 22 May 2023. The carrying amount at year end is £550,261 (2021 - £550,085).

The loan is secured against all that leasehold property known as phase 1 NE3838/3 Queens Meadow Business Park, Hartlepool as registered at the land registry with title number ce194278.

Subsequent to the balance sheet date, the loan was partially redeemed and the remaining balance was refinanced for an additional five years. As a result, the final repayment date is now 22 August 2028.

18

Pension and other schemes

Defined contribution pension scheme

The company operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the company to the scheme and amounted to £3,605 (2021 - £8,943).

19

Share capital

Allotted, called up and fully paid shares

 

31 October
2022

31 October
2021

 

No.

£

No.

£

Ordinary shares of £1 each

50,000

50,000

50,000

50,000

         
 

Rivergreen Developments PLC

Notes to the Financial Statements for the Year Ended 31 October 2022 (continued)

20

Reserves

Profit and loss account

This reserve records retained earnings, gains and losses on asset revaluations and accumulated losses.

21

Obligations under leases and hire purchase contracts

Operating leases

The total of future minimum lease payments is as follows:

31 October
2022
£

31 October
2021
£

Not later than one year

-

2,268

The amount of non-cancellable operating lease payments recognised as an expense during the year was £2,268 (2021 - £10,208).

22

Contingent liabilities

In respect of one of its development projects the company has received grants from the following organisation which may be repayable in full or in part under certain conditions. Grants in the sum of £1,121,148 from the Secretary of State for the Environment under Section 5(2) of the Regional Development Agencies Act 1998. The company has given an unlimited multilateral guarantee to its bankers in respect of the facilities of its parent company Rivergreen Limited. No liability is expected to arise as a result of this guarantee.

23

Related party transactions

Hotel Operations Limited is a related party by virtue of common directorship and shareholders of P H Candler and P A Ganley. Net loan movements during the period, excluding interest, totalled £nil (2021 - £nil). At the period end, included within debtors before provision is an amount of £1,427,829 (2021 - £1,427,829) due to the company. The loan balance is subject to an interest charge of 2.0% above the bank base rate on a cumulative basis. During the period the company charged loan interest of £96,753 (2021 - £108,745), all of which along with the entire amount due of £1,427,829 was provided against as a bad debt provision as the directors do not consider the amounts to be recoverable. Subsequent to the balance sheet date these debts were formally written off in full with no recovery.

Jesmond Dene House Limited is a 100% subsidiary of Hotel Operations Limited. During the period the company made net purchases totalling £(71,520) (2021 - £23,800). At the period end the balance owed from Jesmond Dene House Limited, was £(71,520) (2021 - £52,058). At the period end, included within debtors before any provision is an amount of £1,287,699 (2021 - £1,287,699) due to the company. A net provision of £1,216,179 has been made against this debtor as the directors do not consider the amounts to be recoverable. Subsequent to the balance sheet date these debts were formally written off in full with no recovery.

 

Rivergreen Developments PLC

Notes to the Financial Statements for the Year Ended 31 October 2022 (continued)

23

Related party transactions (continued)

St Mary’s Inn Limited was a 100% subsidiary of Hotel Operations Limited. During the period the company made advances to St Mary’s Inn Limited totalling £nil (2021 - £nil). At the period end, included within debtors before any provision is an amount of £nil (2021 - £14) due to the company. A provision of £14 has been made against this debtor as the directors do not consider the amounts to be recoverable following the administration of the company.

B W Sipp Trustee Ltd is a related party by virtue of common directorships of P H Candler and P A Ganley. At the period end, included within trade creditors is an amount of £93,700 (2021 - £93,700) due to the company in respect of guaranteed rental income.

24

Parent and ultimate parent undertaking

The company's immediate parent is Rivergreen Limited, incorporated in England and Wales.

 The most senior parent entity producing publicly available financial statements is Rivergreen Limited. These financial statements are available upon request from The Farm House & Byre, Aykley Heads Farm, Aykley Heads, Durham, DH1 5AN

 The ultimate controlling party is considered to be P H Candler and P A Ganley.

25

Non adjusting events after the financial period

Subsequent to the balance sheet date an Atom Bank loan was partially redeemed and the remaining balance was refinanced for an additional five years. As a result the final repayment date is now 22 August 2028.

Subsequent to the balance sheet date the fully provided for debts due from Hotel Operations Limited and Jesmond Dene House Limited were formally written off in full with no recovery.