Company registration number 13889629 (England and Wales)
CAREY CARE LTD
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2023
CAREY CARE LTD
COMPANY INFORMATION
Directors
A. Robshaw
(Appointed 2 February 2022)
J. Albon
(Appointed 2 February 2022)
Company number
13889629
Registered office
48-50 Park Road
Kenley
Surrey
CR8 5AR
Auditor
Clarkson Hyde LLP
3rd Floor
Chancery House
St Nicholas Way
Sutton
Surrey
SM1 1JB
CAREY CARE LTD
CONTENTS
Page
Strategic report
1
Directors' report
2
Directors' responsibilities statement
3
Independent auditor's report
4 - 6
Profit and loss account
7
Group statement of comprehensive income
8
Group balance sheet
9
Company balance sheet
10
Group statement of changes in equity
11
Company statement of changes in equity
12
Group statement of cash flows
13
Company statement of cash flows
14
Notes to the financial statements
15 - 28
CAREY CARE LTD
STRATEGIC REPORT
FOR THE PERIOD ENDED 31 MARCH 2023
- 1 -

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

 

Carey Care Ltd is a group whose primary activities are the provision and operation of Nursing Care Homes. The performance of the business throughout the 2022-23 financial year has been positive, and the profit generated slightly exceeded expectations.

 

Since the MBO of Hill House Nursing Home Ltd, we have worked to identify areas of improvement to the business, particularly through the use of technology. As was expected and due to the nature of the buildings, there will continue to be expenditure required on maintenance and upgrades to the Homes, which will in turn enable the Group to stay competitive and run efficiently.

 

In general market conditions remain stable and we expect continued growing demand for Nursing Care as people live longer and levels of dependency increase. However, a principal risk is the affordability of the service. As an operator we work to maintain competitive fees whilst providing a high level of care for Service Users but must continue to identify efficiencies in order to maintain positive margins. The use of new technologies and upgrades to Company systems will help to future proof the operations of the business, although increasing the reliance on suppliers of these services. Going into the next financial year it has been reassuring to see utility costs settle after an extended period of extremely high rates, which were felt in H2 of 2022-23, and H1 of 2023-24.

 

Going forward, Carey Care Ltd is now beginning to identify opportunities for expansion of the group over the next few years.

 

Review of the business

On behalf of the board

A. Robshaw
Director
1 February 2024
CAREY CARE LTD
DIRECTORS' REPORT
FOR THE PERIOD ENDED 31 MARCH 2023
- 2 -

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

Principal activities

The principal activity of the company and group continued to be that of nursing and residential care services.

Results and dividends

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

Ordinary dividends were paid amounting to £40,000. The directors do not recommend payment of a further dividend.

Directors

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

A. Robshaw
(Appointed 2 February 2022)
J. Albon
(Appointed 2 February 2022)
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.

Medium-sized companies exemption

This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.

On behalf of the board
A. Robshaw
Director
1 February 2024
CAREY CARE LTD
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE PERIOD 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.

CAREY CARE LTD
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF CAREY CARE LTD
- 4 -
Opinion

We have audited the financial statements of Carey Care Limited (the 'parent company') and its subsidiaries (the 'group') for the period ended 31 March 2023 which comprise the group profit and loss account, 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:

CAREY CARE LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF CAREY CARE LTD
- 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.

We gained an understanding of the legal and regulatory framework applicable to the company and the industry in which it

operates, and considered the risk of acts by the company that were contrary to applicable laws and regulations, including

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

We focussed on laws and regulations which could give rise to material misstatement in the financial statements, including, but not limited to, the Companies Act 2006 and UK tax legislation. Our tests included agreeing the financial statement disclosures to underlying supporting documentation and enquiries with management. There are inherent limitations in the audit procedures described above, and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it. We did not identify any key audit matters relation to irregularities, including fraud. As in all of our audits, we also addressed the risk of management override of internal controls, including testing journals and evaluating whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud.

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

Use of our report

This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

CAREY CARE LTD
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF CAREY CARE LTD
- 6 -
Graham Speck (Senior Statutory Auditor)
For and on behalf of Clarkson Hyde LLP
1 February 2024
Chartered Accountants
Statutory Auditor
3rd Floor
Chancery House
St Nicholas Way
Sutton
Surrey
SM1 1JB
CAREY CARE LTD
GROUP PROFIT AND LOSS ACCOUNT
FOR THE PERIOD ENDED 31 MARCH 2023
- 7 -
Period
ended
31 March
2023
Notes
£
Turnover
3
3,714,855
Cost of sales
(2,254,492)
Gross profit
1,460,363
Administrative expenses
(744,677)
Other operating income
16,935
Operating profit
4
732,621
Interest receivable and similar income
7
17,066
Interest payable and similar expenses
8
(129,238)
Profit before taxation
620,449
Tax on profit
9
(150,608)
Profit for the financial period
469,841
Profit for the financial period is all attributable to the owners of the parent company.
CAREY CARE LTD
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED 31 MARCH 2023
- 8 -
Period
ended
31 March
2023
£
Profit for the period
469,841
Other comprehensive income
-
Total comprehensive income for the period
469,841
Total comprehensive income for the period is all attributable to the owners of the parent company.
CAREY CARE LTD
GROUP BALANCE SHEET
AS AT
31 MARCH 2023
31 March 2023
- 9 -
2023
Notes
£
£
Fixed assets
Goodwill
11
3,234,803
Tangible assets
12
1,919,748
5,154,551
Current assets
Debtors
15
221,297
Cash at bank and in hand
1,522,104
1,743,401
Creditors: amounts falling due within one year
16
(913,538)
Net current assets
829,863
Total assets less current liabilities
5,984,414
Creditors: amounts falling due after more than one year
17
(4,403,573)
Net assets
1,580,841
Capital and reserves
Called up share capital
20
1,000
Share premium account
1,150,000
Profit and loss reserves
429,841
Total equity
1,580,841

These financial statements have been prepared in accordance with the provisions relating to medium-sized groups.

The financial statements were approved by the board of directors and authorised for issue on 1 February 2024 and are signed on its behalf by:
01 February 2024
A. Robshaw
Director
Company registration number 13889629 (England and Wales)
CAREY CARE LTD
COMPANY BALANCE SHEET
AS AT 31 MARCH 2023
31 March 2023
- 10 -
2023
Notes
£
£
Fixed assets
Investments
13
6,205,904
Current assets
Debtors
15
370
Cash at bank and in hand
19,212
19,582
Creditors: amounts falling due within one year
16
(670,148)
Net current liabilities
(650,566)
Total assets less current liabilities
5,555,338
Creditors: amounts falling due after more than one year
17
(4,403,573)
Net assets
1,151,765
Capital and reserves
Called up share capital
20
1,000
Share premium account
1,150,000
Profit and loss reserves
765
Total equity
1,151,765

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 £40,765.

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

The financial statements were approved by the board of directors and authorised for issue on 1 February 2024 and are signed on its behalf by:
01 February 2024
A. Robshaw
Director
Company registration number 13889629 (England and Wales)
CAREY CARE LTD
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 31 MARCH 2023
- 11 -
Share capital
Share premium account
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 2 February 2022
-
0
-
0
-
0
-
Period ended 31 March 2023:
Profit and total comprehensive income
-
-
469,841
469,841
Issue of share capital
20
1,000
1,150,000
-
1,151,000
Dividends
10
-
-
(40,000)
(40,000)
Balance at 31 March 2023
1,000
1,150,000
429,841
1,580,841
CAREY CARE LTD
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 31 MARCH 2023
- 12 -
Share capital
Share premium account
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 2 February 2022
-
0
-
0
-
0
-
Period ended 31 March 2023:
Profit and total comprehensive income
-
-
40,765
40,765
Issue of share capital
20
1,000
1,150,000
-
1,151,000
Dividends
10
-
-
(40,000)
(40,000)
Balance at 31 March 2023
1,000
1,150,000
765
1,151,765
CAREY CARE LTD
GROUP STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED 31 MARCH 2023
- 13 -
2023
Notes
£
£
Cash flows from operating activities
Cash generated from/(absorbed by) operations
22
1,014,446
Interest paid
(129,238)
Income taxes paid
(120,440)
Net cash inflow/(outflow) from operating activities
764,768
Investing activities
Purchase of business
(2,138,587)
Loans made to other entities
(445)
Interest received
17,066
Net cash used in investing activities
(2,121,966)
Financing activities
Proceeds from issue of shares
800
Proceeds from new bank loans
3,000,000
Repayment of bank loans
(81,498)
Dividends paid to equity shareholders
(40,000)
Net cash generated from/(used in) financing activities
2,879,302
Net increase in cash and cash equivalents
1,522,104
Cash and cash equivalents at beginning of period
-
0
Cash and cash equivalents at end of period
1,522,104
CAREY CARE LTD
COMPANY STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED 31 MARCH 2023
- 14 -
2023
Notes
£
£
Cash flows from operating activities
Cash generated from/(absorbed by) operations
23
528,164
Interest paid
(129,218)
Net cash inflow/(outflow) from operating activities
398,946
Investing activities
Purchase of business
(3,455,904)
Loans made
(170)
Interest received
38
Dividends received
197,000
Net cash used in investing activities
(3,259,036)
Financing activities
Proceeds from issue of shares
800
Proceeds from new bank loans
3,000,000
Repayment of bank loans
(81,498)
Dividends paid to equity shareholders
(40,000)
Net cash generated from/(used in) financing activities
2,879,302
Net increase in cash and cash equivalents
19,212
Cash and cash equivalents at beginning of period
-
0
Cash and cash equivalents at end of period
19,212
CAREY CARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2023
- 15 -
1
Accounting policies
Company information

Carey Care Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is 48-50 Park Road, Kenley, Surrey, CR8 5AR.

 

The group consists of Carey Care Limited and all of its subsidiaries.

1.1
Reporting period

The financial statements are presented for the period ended 31 March 2023, a period longer than 12 months. This is due to the parent bringing their accounting period in-line with their subsidiary.

1.2
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.

1.3
Business combinations

In the parent company financial statements, the cost of a business combination is the fair value at the acquisition date of the assets given, equity instruments issued and liabilities incurred or assumed, plus costs directly attributable to the business combination. The excess of the cost of a business combination over the fair value of the identifiable assets, liabilities and contingent liabilities acquired is recognised as goodwill. The cost of the combination includes the estimated amount of contingent consideration that is probable and can be measured reliably, and is adjusted for changes in contingent consideration after the acquisition date. Provisional fair values recognised for business combinations in previous periods are adjusted retrospectively for final fair values determined in the 12 months following the acquisition date. Investments in subsidiaries, joint ventures and associates are accounted for at cost less impairment.

 

Deferred tax is recognised on differences between the value of assets (other than goodwill) and liabilities recognised in a business combination accounted for using the purchase method and the amounts that can be deducted or assessed for tax, considering the manner in which the carrying amount of the asset or liability is expected to be recovered or settled. The deferred tax recognised is adjusted against goodwill or negative goodwill.

1.4
Basis of consolidation

The consolidated group financial statements consist of the financial statements of the parent company Carey Care Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.

 

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.

Subsidiaries are consolidated in the group’s financial statements from the date that control commences until the date that control ceases.

1.5
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.

CAREY CARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 16 -
1.6
Turnover

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.

1.7
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 10 years.

 

For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.

1.8
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:

Freehold land and buildings
2% Straight line
Plant and equipment
20% Straight line
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.

1.9
Fixed asset investments

Equity investments are measured at fair value through profit or loss, except for those equity investments that are not publicly traded and whose fair value cannot otherwise be measured reliably, which are recognised at cost less impairment until a reliable measure of fair value becomes available.

 

In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are 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.

CAREY CARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 17 -
1.10
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.

 

The carrying amount of the investments accounted for using the equity method is tested for impairment as a single asset. Any goodwill included in the carrying amount of the investment is not tested separately for impairment.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

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

1.11
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.

1.12
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.

Basic financial assets

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Other financial assets

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

CAREY CARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 18 -
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.

Other financial liabilities

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

 

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

Derecognition of financial liabilities

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

1.13
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.

CAREY CARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 19 -
1.14
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 liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset 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.

1.15
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.

1.16
Retirement benefits

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

1.17
Leases

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

1.18
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.

CAREY CARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 MARCH 2023
- 20 -
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
2023
£
Turnover analysed by class of business
Nursing and care servicies
3,714,855
2023
£
Turnover analysed by geographical market
United Kingdom
3,714,855
2023
£
Other revenue
Interest income
17,066
Grants received
16,935
4
Operating profit
2023
£
Operating profit for the period is stated after charging/(crediting):
Government grants
(16,935)
Depreciation of owned tangible fixed assets
30,511
Amortisation of intangible assets
231,057
Operating lease charges
1,872
5
Auditor's remuneration
2023
Fees payable to the company's auditor and associates:
£
For audit services
Audit of the financial statements of the group and company
1,800
Audit of the financial statements of the company's subsidiaries
6,000
7,800
CAREY CARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 MARCH 2023
- 21 -
6
Employees

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

Group
Company
2023
2023
Number
Number
113
-
0

Their aggregate remuneration comprised:

Group
Company
2023
2023
£
£
Wages and salaries
2,084,528
-
0
Social security costs
154,818
-
Pension costs
30,952
-
0
2,270,298
-
0
7
Interest receivable and similar income
2023
£
Interest income
Interest on bank deposits
17,035
Other interest income
31
Total income
17,066
2023
Investment income includes the following:
£
Interest on financial assets not measured at fair value through profit or loss
17,035
8
Interest payable and similar expenses
2023
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
105,218
Other finance costs:
Other interest
24,020
Total finance costs
129,238
CAREY CARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 MARCH 2023
- 22 -
9
Taxation
2023
£
Current tax
UK corporation tax on profits for the current period
150,608

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

2023
£
Profit before taxation
620,449
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00%
117,885
Tax effect of expenses that are not deductible in determining taxable profit
6,255
Amortisation on assets not qualifying for tax allowances
43,901
Capital allowances
(237)
Other timing differences
(17,196)
Taxation charge
150,608
10
Dividends
2023
Recognised as distributions to equity holders:
£
Final paid
40,000
11
Intangible fixed assets
Group
Goodwill
£
Cost
At 2 February 2022
-
0
Additions - business combinations
3,465,860
At 31 March 2023
3,465,860
Amortisation and impairment
At 2 February 2022
-
0
Amortisation charged for the period
231,057
At 31 March 2023
231,057
Carrying amount
At 31 March 2023
3,234,803
The company had no intangible fixed assets at 31 March 2023.
CAREY CARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 MARCH 2023
- 23 -
12
Tangible fixed assets
Group
Freehold land and buildings
Plant and equipment
Motor vehicles
Total
£
£
£
£
Cost
At 2 February 2022
-
0
-
0
-
0
-
0
Business combinations
1,932,992
11,083
6,184
1,950,259
At 31 March 2023
1,932,992
11,083
6,184
1,950,259
Depreciation and impairment
At 2 February 2022
-
0
-
0
-
0
-
0
Depreciation charged in the period
26,615
2,771
1,125
30,511
At 31 March 2023
26,615
2,771
1,125
30,511
Carrying amount
At 31 March 2023
1,906,377
8,312
5,059
1,919,748
The company had no tangible fixed assets at 31 March 2023.
13
Fixed asset investments
Group
Company
2023
2023
Notes
£
£
Investments in subsidiaries
14
-
0
6,205,904
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 2 February 2022
-
Additions
6,205,904
At 31 March 2023
6,205,904
Carrying amount
At 31 March 2023
6,205,904
14
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
Hill House Nursing Home Limited
48-50 Park Road, Kenley, England, CR8 5AR
Ordinary
100.00
CAREY CARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 MARCH 2023
- 24 -
15
Debtors
Group
Company
2023
2023
Amounts falling due within one year:
£
£
Trade debtors
198,899
-
0
Unpaid share capital
200
200
Other debtors
3,757
170
Prepayments and accrued income
18,441
-
0
221,297
370
16
Creditors: amounts falling due within one year
Group
Company
2023
2023
Notes
£
£
Bank loans
18
114,929
114,929
Trade creditors
299,299
26
Amounts owed to group undertakings
-
0
510,513
Corporation tax payable
203,320
-
0
Other taxation and social security
53,469
-
Other creditors
51,927
17,200
Accruals and deferred income
190,594
27,480
913,538
670,148
17
Creditors: amounts falling due after more than one year
Group
Company
2023
2023
Notes
£
£
Bank loans and overdrafts
18
2,803,573
2,803,573
Other borrowings
18
1,600,000
1,600,000
4,403,573
4,403,573
CAREY CARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 MARCH 2023
- 25 -
18
Loans and overdrafts
Group
Company
2023
2023
£
£
Bank loans
2,918,502
2,918,502
Other loans
1,600,000
1,600,000
4,518,502
4,518,502
Payable within one year
114,929
114,929
Payable after one year
4,403,573
4,403,573

The long-term bank loan is secured by a fixed charge over the freehold property owned by the subsidiary.

The initial bank loan of £3,000,000 was taken out for 15 years attracting an interest rate charge of 2.44% per annum over the Bank of England Base Rate. As at the year end, the bank loan had approximately 172 months left to run.

 

The other loan of £1,600,00 relates to loan notes that are due for repayment on 31 July 2037. The loan notes attract an interest rate charge of 2.25%.

19
Retirement benefit schemes
2023
Defined contribution schemes
£
Charge to profit or loss in respect of defined contribution schemes
30,952

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.

20
Share capital
Group and company
2023
2023
Ordinary share capital
Number
£
Issued and not fully paid
Ordinary of £1 each
800
800
B Ordinary of £1 each
200
200
1,000
1,000

The 'B' Ordinary shares are issued, called up but not yet fully paid.

CAREY CARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 MARCH 2023
- 26 -
21
Acquisition of a business

On 31 July 2022 the group acquired 100 percent of the issued capital of Hill House Nursing Home Limited.

Book Value
Adjustments
Fair Value
Net assets acquired
£
£
£
Property, plant and equipment
1,950,259
-
1,950,259
Trade and other receivables
261,689
-
261,689
Cash and cash equivalents
1,317,317
-
1,317,317
Trade and other payables
(616,069)
-
(616,069)
Tax liabilities
(173,152)
-
(173,152)
Total identifiable net assets
2,740,044
-
2,740,044
Goodwill
3,465,860
Total consideration
6,205,904
The consideration was satisfied by:
£
Cash
3,455,904
Issue of shares
1,150,000
Issue of loan notes
1,600,000
6,205,904
Contribution by the acquired business for the reporting period included in the group statement of comprehensive income since acquisition:
£
Turnover
3,714,855
Profit after tax
915,580
CAREY CARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 MARCH 2023
- 27 -
22
Cash generated from/(absorbed by) group operations
2023
£
Profit for the period after tax
469,841
Adjustments for:
Taxation charged
150,608
Finance costs
129,238
Investment income
(17,066)
Amortisation and impairment of intangible assets
231,057
Depreciation and impairment of tangible fixed assets
30,511
Movements in working capital:
Decrease in debtors
41,037
Decrease in creditors
(20,780)
Cash generated from/(absorbed by) operations
1,014,446
23
Cash generated from/(absorbed by) operations - company
2023
£
Profit for the period after tax
40,765
Adjustments for:
Finance costs
129,218
Investment income
(197,038)
Movements in working capital:
Increase in creditors
555,219
Cash generated from/(absorbed by) operations
528,164
24
Analysis of changes in net debt - group
2 February 2022
Cash flows
31 March 2023
£
£
£
Cash at bank and in hand
-
1,522,104
1,522,104
Borrowings excluding overdrafts
-
(4,518,502)
(4,518,502)
-
(2,996,398)
(2,996,398)
CAREY CARE LTD
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 MARCH 2023
- 28 -
25
Analysis of changes in net debt - company
2 February 2022
Cash flows
31 March 2023
£
£
£
Cash at bank and in hand
-
19,212
19,212
Borrowings excluding overdrafts
-
(4,518,502)
(4,518,502)
-
(4,499,290)
(4,499,290)
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