THORNTOUN (2008) LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
Company registration number SC337344 (Scotland)
THORNTOUN (2008) LIMITED
COMPANY INFORMATION
Directors
Mr Richard Johnstone
Mr William Johnstone
Mrs Agnes Johnstone
Secretary
Mr David Brown
Company number
SC337344
Registered office
Thorntoun Estate
Crosshouse
Kilmarnock
Ayrshire
KA2 0BH
Auditor
William Duncan + Co (Audit) Ltd
Ellersley House
30 Miller Road
Ayr
Ayrshire
KA7 2AY
Business address
Thorntoun Estate
Crosshouse
Kilmarnock
Ayrshire
KA2 0BH
Bankers
Bank of Scotland
123 High Street
Ayr
Ayrshire
KA7 1QP
Bank of Scotland
167-201 Argyle Street
Glasgow
G2 8BU
Solicitors
Morton Fraser Solicitors
1 West Regent Street
Glasgow
G2 1RW
THORNTOUN (2008) LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2
Directors' responsibilities statement
3
Independent auditor's report
4 - 6
Group statement of comprehensive income
7
Group balance sheet
8
Company balance sheet
9
Group statement of changes in equity
10
Company statement of changes in equity
11
Group statement of cash flows
12
Company statement of cash flows
13
Notes to the financial statements
14 - 26
THORNTOUN (2008) LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 1 -

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

Fair review of the business

The directors continue to monitor and control the key performance indicators of occupancy, average rate per bed, and wages costs.

 

During this year the group has reverted back to the pre covid trading model that has resulted in a period of adjustment with covid support grants having been removed. After the immediate effect on occupancy, it has taken some time to rectify and build this back up. In addition to this, covid still affected the group within staffing and agency costs.

 

In a challenging year for all care homes, the results for the year and the financial position at the year end were considered satisfactory by the directors. The group is in a strong financial position and the directors expect the business to continue to trade successfully and are ready to react to and update plans as necessary.

Principal risks and uncertainties

As a provider of care and respite to the elderly and disabled, the company continues to maintain a focus on high standards and is always trying to ensure that the services provided are relevant to the changes in needs of the community.

 

The company maintains a well established process for identifying and managing business risks. For each risk identified, the directors ensure that controls are in place to either prevent the risk or to mitigate the effect of the risk.

 

With respect to clinical risk, the company is dedicated to ensuring that its residents are treated and cared for with the highest clinical standards. The company is aware that there were specific risks associated with the pandemic, such as maintaining adequate staffing and protecting residents, and the company had plans in place to deal with the impact of such an emergency.

 

With regard to funding risk, the company supports its operations from internally generated profits.

Key performance indicators

The directors are committed to maintaining key financial ratios to ensure that there is appropriate financial headroom.

On behalf of the board

Mr Richard Johnstone
Director
1 November 2023
THORNTOUN (2008) LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2023
- 2 -

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

Principal activities

The principal activities of the group in the year under review were that of a registered nursing home providing accommodation and care for the elderly, together with accommodation providing both respite care and long stay care for adults with learning difficulties.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

Mr Richard Johnstone
Mr William Johnstone
Mrs Agnes Johnstone
Results and dividends

The results for the year are set out on page 7.

No ordinary dividends were paid. The directors do not recommend payment of a further dividend.

Disabled persons

Applications for employment by disabled persons are always fully considered, bearing in mind the aptitudes of the applicant concerned. In the event of members of staff becoming disabled, every effort is made to ensure that their employment within the group continues and that the appropriate training is arranged. It is the policy of the group that the training, career development and promotion of disabled persons should, as far as possible, be identical to that of other employees.

Employee involvement

The group's policy is to consult and discuss with employees, through unions, staff councils and at meetings, matters likely to affect employees' interests.

 

Information about matters of concern to employees is given through information bulletins and reports which seek to achieve a common awareness on the part of all employees of the financial and economic factors affecting the group's performance.

 

There is no employee share scheme at present, but the directors are considering the introduction of such a scheme as a means of further encouraging the involvement of employees in the company's performance.

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 auditor of the company 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 auditor of the company is aware of that information.

On behalf of the board
Mr Richard Johnstone
Director
1 November 2023
THORNTOUN (2008) LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 MARCH 2023
- 3 -

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 group and company, and of the profit or loss of the group 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 group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

THORNTOUN (2008) LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF THORNTOUN (2008) LIMITED
- 4 -
Opinion

We have audited the financial statements of Thorntoun (2008) Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 March 2023 which comprise the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows, the company 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 group and parent 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 group's and parent 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:

THORNTOUN (2008) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF THORNTOUN (2008) LIMITED
- 5 -
Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and the parent company and their 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 parent 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 parent 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.

 

 

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.

THORNTOUN (2008) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF THORNTOUN (2008) LIMITED
- 6 -

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.

Mr Neil Reid FCCA (Senior Statutory Auditor)
For and on behalf of William Duncan + Co (Audit) Ltd
2 November 2023
Chartered Accountants
Statutory Auditor
Ellersley House
30 Miller Road
Ayr
Ayrshire
KA7 2AY
THORNTOUN (2008) LIMITED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2023
- 7 -
2023
2022
Notes
£
£
Turnover
3
8,538,793
7,778,335
Cost of sales
(6,784,959)
(5,902,697)
Gross profit
1,753,834
1,875,638
Administrative expenses
(1,633,242)
(1,656,207)
Other operating income
155,673
751,450
Operating profit
4
276,265
970,881
Interest receivable and similar income
8
40,893
23,649
Profit before taxation
317,158
994,530
Tax on profit
9
(86,025)
(247,058)
Profit for the financial year
231,133
747,472
Profit for the financial year is all attributable to the owners of the parent company.
Total comprehensive income for the year is all attributable to the owners of the parent company.

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

THORNTOUN (2008) LIMITED
GROUP BALANCE SHEET
AS AT
31 MARCH 2023
31 March 2023
- 8 -
2023
2022
Notes
£
£
£
£
Fixed assets
Goodwill
10
480,448
576,536
Tangible assets
11
3,351,950
3,391,998
3,832,398
3,968,534
Current assets
Stocks
14
2,000
2,000
Debtors
15
2,584,043
2,360,803
Cash at bank and in hand
1,424,857
1,588,806
4,010,900
3,951,609
Creditors: amounts falling due within one year
16
(1,124,134)
(1,135,755)
Net current assets
2,886,766
2,815,854
Total assets less current liabilities
6,719,164
6,784,388
Provisions for liabilities
Deferred tax liability
17
148,703
145,060
(148,703)
(145,060)
Net assets
6,570,461
6,639,328
Capital and reserves
Called up share capital
19
7,500
7,500
Share premium account
992,500
992,500
Equity reserve
20
(281,801)
(305,719)
Profit and loss reserves
5,783,152
5,876,635
Equity attributable to owners of the parent company
6,501,351
6,570,916
Non-controlling interests
69,110
68,412
6,570,461
6,639,328
The financial statements were approved by the board of directors and authorised for issue on 1 November 2023 and are signed on its behalf by:
01 November 2023
Mr Richard Johnstone
Director
Company registration number SC337344 (Scotland)
THORNTOUN (2008) LIMITED
COMPANY BALANCE SHEET
AS AT 31 MARCH 2023
31 March 2023
- 9 -
2023
2022
Notes
£
£
£
£
Fixed assets
Investments
12
4,056,000
4,056,000
Current assets
Cash at bank and in hand
1
1
Net current assets
1
1
Net assets
4,056,001
4,056,001
Capital and reserves
Called up share capital
19
7,500
7,500
Share premium account
992,500
992,500
Profit and loss reserves
3,056,001
3,056,001
Total equity
4,056,001
4,056,001

As permitted by s408 Companies Act 2006, the Company has not presented its own profit and loss account and related notes. The Company’s profit for the year was £0 (2022 - £0 profit).

The financial statements were approved by the board of directors and authorised for issue on 1 November 2023 and are signed on its behalf by:
01 November 2023
Mr Richard Johnstone
Director
Company registration number SC337344 (Scotland)
THORNTOUN (2008) LIMITED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
- 10 -
Share capital
Share premium account
Equity reserve
Profit and loss reserves
Total controlling interest
Non-controlling interest
Total
Notes
£
£
£
£
£
£
£
Balance at 1 April 2021
7,500
992,500
(329,368)
5,417,305
6,087,937
63,919
6,151,856
Year ended 31 March 2022:
Profit and total comprehensive income for the year
-
-
-
747,472
747,472
-
747,472
Dividends
-
-
-
(260,000)
(260,000)
-
(260,000)
Transfer of amortised cost movements
19
-
0
-
0
23,649
(23,649)
-
-
-
Minority interest share in year
-
-
-
(4,493)
(4,493)
4,493
-
Balance at 31 March 2022
7,500
992,500
(305,719)
5,876,635
6,570,916
68,412
6,639,328
Year ended 31 March 2023:
Profit and total comprehensive income for the year
-
-
-
231,133
231,133
-
231,133
Dividends
-
-
-
(300,000)
(300,000)
-
(300,000)
Transfer of amortised cost movements
19
-
0
-
0
23,918
(23,918)
-
-
-
Minority interest share in year
-
-
-
(698)
(698)
698
-
Balance at 31 March 2023
7,500
992,500
(281,801)
5,783,152
6,501,351
69,110
6,570,461
THORNTOUN (2008) LIMITED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
- 11 -
Share capital
Share premium account
Profit and loss reserves
Total
£
£
£
£
Balance at 1 April 2021
7,500
992,500
3,056,001
4,056,001
Year ended 31 March 2022:
Profit and total comprehensive income for the year
-
-
-
-
0
Balance at 31 March 2022
7,500
992,500
3,056,001
4,056,001
Year ended 31 March 2023:
Profit and total comprehensive income for the year
-
-
-
-
0
Balance at 31 March 2023
7,500
992,500
3,056,001
4,056,001
THORNTOUN (2008) LIMITED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2023
- 12 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
24
396,060
1,283,212
Corporation tax paid
(216,297)
(165,374)
Net cash inflow from operating activities
179,763
1,117,838
Investing activities
Purchase of tangible fixed assets
(84,605)
(100,975)
Loans advanced
-
1,069
Interest received
40,893
23,649
Net cash used in investing activities
(43,712)
(76,257)
Financing activities
Dividends paid to equity shareholders
(300,000)
(260,000)
Net cash used in financing activities
(300,000)
(260,000)
Net (decrease)/increase in cash and cash equivalents
(163,949)
781,581
Cash and cash equivalents at beginning of year
1,588,806
807,225
Cash and cash equivalents at end of year
1,424,857
1,588,806
THORNTOUN (2008) LIMITED
COMPANY STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2023
- 13 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Net increase in cash and cash equivalents
-
-
Cash and cash equivalents at beginning of year
1
1
Cash and cash equivalents at end of year
1
1
THORNTOUN (2008) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
- 14 -
1
Accounting policies
Company information

Thorntoun (2008) Limited (“the company”) is a private limited company domiciled and incorporated in Scotland. The registered office is 30 Miller Road, Ayr, Ayrshire, KA7 2AY.

 

The group consists of Thorntoun (2008) Limited and all of its subsidiaries.

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.

The group has taken the exemption available under FRS102 Section 33 'Related Party Disclosures' and has not disclosed transactions with any wholly owned subsidiary undertaking of the group.

As permitted by s408 Companies Act 2006, the Company has not presented its own profit and loss account and related notes. The Company’s profit for the year was £0 (2022 - £0 profit).

The consolidated financial statements incorporate those of Thorntoun (2008) Limited and all of its subsidiaries (ie entities that the group controls through its power to govern the financial and operating policies so as to obtain economic benefits). Subsidiaries acquired during the year are consolidated using the purchase method. Their results are incorporated from the date that control passes.

 

All financial statements are made up to 31 March 2023. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

 

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

1.2
Going concern

At the time of approving the financial statements, the directors have a reasonable expectation that the group 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

Fees are recognised at the fair value of the consideration received or receivable for the provision of nursing and residential care provided in the normal course of business. Revenue is recognised at the point in time when services are provided.

1.4
Intangible fixed assets - goodwill

Goodwill represents the excess of the cost of acquisition of a business over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 20 years.

THORNTOUN (2008) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 15 -
1.5
Tangible fixed assets

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

Land and buildings Freehold
2% Reducing Balance
Plant and machinery
20% Reducing Balance
Fixtures, fittings & equipment
20% Reducing Balance
Motor vehicles
25% Reducing Balance

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

1.6
Fixed asset investments

In the parent company financial statements investments in subsidiariesare initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

1.7
Impairment of fixed assets

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

 

1.8
Stocks

Food and consumables are valued at the lower of cost and net realisable value.

1.9
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.

1.10
Financial instruments

The group 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 group's balance sheet when the group becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset and 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.

THORNTOUN (2008) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 16 -
Basic financial assets

Basic financial assets, which include trade and other receivables and cash and bank balances, are measured at transaction price including transaction costs. There are no arrangements that constitutes a financing transaction, where the transaction would be measured at amortised cost.

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 group 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 group 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.

Derecognition of financial liabilities

Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.

1.11
Equity instruments

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

THORNTOUN (2008) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 17 -
1.12
Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’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 is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset if, and only if, there is 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.

1.13
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.

1.14
Retirement benefits

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

1.15
Government grants

Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.

 

A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.

1.16

Other loans

Other loans, which are basic financial instruments are initially recorded at the present value of future receipts discounted at a market rate of interest for similar loans. Subsequently they are measured at amortised cost using the effective interest method. Other loans that are payable within one year are not discounted.

THORNTOUN (2008) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 18 -
2
Judgements and key sources of estimation uncertainty

In the application of the group’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

An analysis of the group's turnover is as follows:

2023
2022
£
£
Turnover
Fees
8,538,793
7,778,335
Other significant revenue
Interest income
40,893
23,649
Grants received
150,053
751,450
4
Operating profit
2023
2022
£
£
Operating profit for the year is stated after charging/(crediting):
Government grants
(150,053)
(751,450)
Depreciation of owned tangible fixed assets
124,653
177,505
Amortisation of intangible assets
96,088
96,088
THORNTOUN (2008) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 19 -
5
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
2,000
2,000
Audit of the financial statements of the company's subsidiaries
12,468
13,500
14,468
15,500
6
Employees

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

Group
Company
2023
2022
2023
2022
Number
Number
Number
Number
Care and other staff
300
309
-
-
Administration
3
3
-
-
1
1
-
-
Total
304
313
-
0
-
0

Their aggregate remuneration comprised:

Group
Company
2023
2022
2023
2022
£
£
£
£
Wages and salaries
5,310,343
4,907,980
-
0
-
0
Social security costs
395,534
358,725
-
-
Pension costs
109,593
126,442
-
0
-
0
5,815,470
5,393,147
-
0
-
0
7
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
39,330
38,119
Company pension contributions to defined contribution schemes
20,000
28,450
59,330
66,569
THORNTOUN (2008) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 20 -
8
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on related party loans
16,975
-
0
Interest receivable from group companies
23,918
23,649
Total income
40,893
23,649

Investment income includes the following:

Interest on financial assets not measured at fair value through profit or loss
40,893
23,649
9
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
82,382
216,297
Deferred tax
Origination and reversal of timing differences
3,643
30,761
Total tax charge
86,025
247,058

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
317,158
994,530
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2022: 19.00%)
60,260
188,961
Tax effect of expenses that are not deductible in determining taxable profit
3,821
(220)
Depreciation on assets not qualifying for tax allowances
10,050
10,596
Amortisation on assets not qualifying for tax allowances
18,257
18,475
Adjustments in respect of financial assets
(4,544)
(4,493)
Other permanent differences
(2,694)
(1,074)
Effect of change in deferred tax rate
875
34,813
Taxation charge
86,025
247,058
THORNTOUN (2008) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 21 -
10
Intangible fixed assets
Group
Goodwill
£
Cost
At 1 April 2022 and 31 March 2023
1,921,768
Amortisation and impairment
At 1 April 2022
1,345,232
Amortisation charged for the year
96,088
At 31 March 2023
1,441,320
Carrying amount
At 31 March 2023
480,448
At 31 March 2022
576,536
The company had no intangible fixed assets at 31 March 2023 or 31 March 2022.
11
Tangible fixed assets
Group
Land and buildings Freehold
Plant and machinery
Fixtures, fittings & equipment
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 April 2022
4,101,301
7,278
2,066,524
106,841
6,281,944
Additions
3,816
-
0
80,789
-
0
84,605
At 31 March 2023
4,105,117
7,278
2,147,313
106,841
6,366,549
Depreciation and impairment
At 1 April 2022
1,170,566
2,827
1,618,936
97,617
2,889,946
Depreciation charged in the year
55,940
1,068
65,339
2,306
124,653
At 31 March 2023
1,226,506
3,895
1,684,275
99,923
3,014,599
Carrying amount
At 31 March 2023
2,878,611
3,383
463,038
6,918
3,351,950
At 31 March 2022
2,930,735
4,451
447,588
9,224
3,391,998
The company had no tangible fixed assets at 31 March 2023 or 31 March 2022.
THORNTOUN (2008) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 22 -
12
Fixed asset investments
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Investments in subsidiaries
13
-
0
-
0
4,056,000
4,056,000
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 April 2022 and 31 March 2023
4,056,000
Carrying amount
At 31 March 2023
4,056,000
At 31 March 2022
4,056,000
13
Subsidiaries

Details of the company's subsidiaries at 31 March 2023 are as follows:

Name of undertaking
Registered office
Class of
% Held
shares held
Direct
Indirect
Thorntoun (Ayrshire) Limited
Scotland
Ordinary
-
100.00
Thorntoun Estate Limited
Scotland
Ordinary
100.00
-
Thorntoun Limited
Scotland
Ordinary
-
99.00
14
Stocks
Group
Company
2023
2022
2023
2022
£
£
£
£
Food consumables
2,000
2,000
-
0
-
0
THORNTOUN (2008) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 23 -
15
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade debtors
483,955
218,756
-
0
-
0
Other debtors
214,753
223,564
-
0
-
0
Prepayments and accrued income
74,335
139,389
-
0
-
0
773,043
581,709
-
-
Amounts falling due after more than one year:
Amount owed by related parties
1,811,000
1,779,094
-
0
-
0
Total debtors
2,584,043
2,360,803
-
-

Loans to related parties have not incurred a market rate of interest in the year ended 31 March 2023 and in the year ended 31 March 2022 and as such have been discounted to fair value to account for the below market rate of interest, with the difference between book value and fair value being recognised in equity. The subsequent unwinding of the discount is recognised as interest income through the Profit and Loss.

16
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
£
£
£
£
Trade creditors
225,393
256,871
-
0
-
0
Corporation tax payable
82,382
216,297
-
0
-
0
Other taxation and social security
84,606
86,228
-
-
Other creditors
74,675
150,482
-
0
-
0
Accruals and deferred income
657,078
425,877
-
0
-
0
1,124,134
1,135,755
-
0
-
0
17
Deferred taxation

Deferred tax assets and liabilities are offset where the group or company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:

Liabilities
Liabilities
2023
2022
Group
£
£
ACAs
148,703
145,060
The company has no deferred tax assets or liabilities.
THORNTOUN (2008) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
17
Deferred taxation
(Continued)
- 24 -
Group
Company
2023
2023
Movements in the year:
£
£
Liability at 1 April 2022
145,060
-
Charge to profit or loss
3,643
-
Liability at 31 March 2023
148,703
-
18
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
109,593
126,442

A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

19
Share capital
Group and company
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
7,500
7,500
7,500
7,500
20
Equity reserve

The equity reserve reflects the discounting of the loans from related parties to fair value and the movement in the year is in relation to the unwinding of the discount. These reserves are not distributable.

21
Operating lease commitments

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

Group
Company
2023
2022
2023
2022
£
£
£
£
Within one year
12,340
11,849
-
-
Between two and five years
-
12,340
-
-
12,340
24,189
-
-
THORNTOUN (2008) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 25 -
22
Capital commitments

Amounts contracted for but not provided in the financial statements:

Group
Company
2023
2022
2023
2022
£
£
£
£
Acquisition of tangible fixed assets
36,000
-
-
-
23
Related party transactions
Remuneration of key management personnel

The remuneration of key management personnel is as follows.

2023
2022
£
£
Aggregate compensation
39,330
38,495
Other information

Included within amounts due from related parties (after more than one year) is a loan to an entity related by virtue of common directorships. This loan is repayable over 12 years with a rate of interest of 1.36%. Repayments of £Nil (2022: £120,000) were made in the year and £16,975 (2022: nil) was charged in the year. The amount outstanding at the balance sheet date was £2,019,000 (£1,978,106).

Included within other creditors (within one year) last year was an amount due to a related party through common directorship. This balance was repaid within the current year and a net amount due from them at 31 March 2023 of £6,578. This balance is interest free and repayable on demand.

24
Cash generated from group operations
2023
2022
£
£
Profit for the year after tax
231,133
747,472
Adjustments for:
Taxation charged
86,025
247,058
Investment income
(40,893)
(23,649)
Amortisation and impairment of intangible assets
96,088
96,088
Depreciation and impairment of tangible fixed assets
124,653
177,504
Movements in working capital:
Increase in debtors
(223,240)
(9,649)
Increase in creditors
122,294
48,388
Cash generated from operations
396,060
1,283,212
THORNTOUN (2008) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 26 -
25
Cash absorbed by operations - company
2023
2022
£
£
Profit for the year after tax
-
-
Cash absorbed by operations
-
-
26
Analysis of changes in net funds - group
1 April 2022
Cash flows
31 March 2023
£
£
£
Cash at bank and in hand
1,588,806
(163,949)
1,424,857
27
Analysis of changes in net funds - company
1 April 2022
31 March 2023
£
£
Cash at bank and in hand
1
1
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