Company Registration No. 01099533 (England and Wales)
HAVENCARE MANAGEMENT LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
PM+M Solutions for Business LLP
Chartered Accountants
New Century House
Greenbank Technology Park
Challenge Way
Blackburn
Lancashire
BB1 5QB
HAVENCARE MANAGEMENT LIMITED
COMPANY INFORMATION
Director
J Winfield
Secretary
J Winfield
Company number
01099533
Registered office
227 Bury Road
Rawtenstall
Rossendale
BB4 6DJ
Auditor
PM+M Solutions for Business LLP
New Century House
Greenbank Technology Park
Challenge Way
Blackburn
Lancashire
BB1 5QB
HAVENCARE MANAGEMENT LIMITED
CONTENTS
Page
Strategic report
1
Director's report
2 - 3
Independent auditor's report
4 - 7
Statement of comprehensive income
8
Balance sheet
9
Statement of changes in equity
10
Notes to the financial statements
11 - 21
HAVENCARE MANAGEMENT LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 30 JUNE 2023
- 1 -
The director presents the strategic report for the year ended 30 June 2023.
Position at the end of the year
In delivering funeral services in the local communities where the business is based across Lancashire, Havencare has a strong, local brand which is recognised for providing high levels of care to individuals and families that seek to use its services.
As a result of the continued focus on high quality services and care, together with the very unfortunate impact of Covid-19 on our population, the business has continued to grow.
At the year end, shareholders' funds amounted to £10,775,856 (2022: £10,372,260).
The directors believe the company's position to be financially robust particularly given that current assets exceed current liabilities to the extent of £4,469,979 (2022: £4,303,583).
Having assessed the main risks facing the company, the directors believe that the high levels of customer service provided are such as to give a realistic expectation of growth and satisfactory trading results in the coming year.
Financial risk management objectives and policies
The company makes little use of financial instruments other than an operational bank account, fixed rate bank loan and the use of finance leases; its exposure to price risk, credit risk and liquidity risk is not material for the assessment of the financial position and profit of the company.
Management's objectives are to:
- retain sufficient liquid funds to enable the company to meet its day to day obligations as they fall due whilst maximising returns on liquid funds; and
- match the repayment schedule of any external borrowings or overdrafts with the expected future cash flows expected to arise from the company's trading activities.
The directors consider there to be no matters of concern.
Key performance indicators
The directors consider the following key performance indicators when reviewing the performance and growth of the business:
2023
2022
Turnover
£6,567,546
£6,431,331
Gross Profit
31.79%
36.81%
Operating Profit
£652,601
£1,142,325
J Winfield
Director
12 February 2024
HAVENCARE MANAGEMENT LIMITED
DIRECTOR'S REPORT
FOR THE YEAR ENDED 30 JUNE 2023
- 2 -
The director presents his annual report and financial statements for the year ended 30 June 2023.
Principal activities
The principal activity of the company continued to be that of a funeral directors.
Results and dividends
The results for the year are set out on page 8.
Ordinary dividends were paid amounting to £188,821. The director does not recommend payment of a further dividend.
Director
The director who held office during the year and up to the date of signature of the financial statements was as follows:
J Winfield
Auditor
The auditor, PM+M Solutions for Business LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
Statement of director's responsibilities
The director is responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the director to prepare financial statements for each financial year. Under that law the director has 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 director must not approve the financial statements unless he is satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the director is required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.
The director is responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. He is also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.
Medium-sized companies exemption
This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.
HAVENCARE MANAGEMENT LIMITED
DIRECTOR'S REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 3 -
On behalf of the board
J Winfield
Director
12 February 2024
HAVENCARE MANAGEMENT LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF HAVENCARE MANAGEMENT LIMITED
- 4 -
Opinion
We have audited the financial statements of Havencare Management Limited (the 'company') for the year ended 30 June 2023 which comprise , the balance sheet, the statement of changes in equity and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
give a true and fair view of the state of the company's affairs as at 30 June 2023 and of its profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the director's use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the director with respect to going concern are described in the relevant sections of this report.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The director is 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:
the information given in the strategic report and the director's report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the director's report have been prepared in accordance with applicable legal requirements.
HAVENCARE MANAGEMENT LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF HAVENCARE MANAGEMENT LIMITED
- 5 -
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the director's report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of director
As explained more fully in the director's responsibilities statement, the director is 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 director determines 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 director is responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the director either intends to liquidate the company or to cease operations, or has 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.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
We identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and then design and perform audit procedures responsive to those risks, including obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion.
HAVENCARE MANAGEMENT LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF HAVENCARE MANAGEMENT LIMITED
- 6 -
Identifying and assessing potential risks related to irregularities In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, we have considered the following: the nature of the industry and sector, control environment and business performance including the design of the Company's remuneration policies, key drivers for directors’ remuneration, bonus levels and performance targets;
As a result of these procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and identified the greatest potential for fraud in the following areas: timing of recognition of commercial income, posting of unusual journals and complex transactions; and manipulating the Company's performance profit measures and other key performance indicators to meet remuneration targets and externally communicated targets. In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of management override. We also obtained an understanding of the legal and regulatory frameworks that the Company operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included UK Companies Act, employment law, health and safety regulations, pensions legislation and tax legislation. |
Audit responses to risk identified
Our procedures to respond to risks identified included the following:
in addressing the identified risks of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.
Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. In addition, as with any audit, there remained a higher risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.
HAVENCARE MANAGEMENT LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF HAVENCARE MANAGEMENT LIMITED
- 7 -
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.
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.
Ceri Dixon BSc (Hons) ACA
Senior Statutory Auditor
For and on behalf of PM+M Solutions for Business LLP
12 February 2024
Chartered Accountants
Statutory Auditor
New Century House
Greenbank Technology Park
Challenge Way
Blackburn
Lancashire
BB1 5QB
HAVENCARE MANAGEMENT LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2023
- 8 -
2023
2022
Notes
£
£
Turnover
3
6,567,546
6,431,331
Cost of sales
(4,479,834)
(4,063,682)
Gross profit
2,087,712
2,367,649
Administrative expenses
(1,435,111)
(1,225,324)
Operating profit
4
652,601
1,142,325
Interest payable and similar expenses
7
(17,253)
(18,987)
Change in fair value of investment property
8
118,000
120,544
Profit before taxation
753,348
1,243,882
Tax on profit
9
(161,146)
(238,594)
Profit for the financial year
592,202
1,005,288
The statement of income and retained earnings has been prepared on the basis that all operations are continuing operations.
HAVENCARE MANAGEMENT LIMITED
BALANCE SHEET
- 9 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
12
6,395,152
6,464,397
Investment property
13
703,000
585,000
Investments
14
10,986
10,986
7,109,138
7,060,383
Current assets
Stocks
16
93,652
107,650
Debtors
17
3,554,183
3,233,566
Cash at bank and in hand
1,590,059
1,924,260
5,237,894
5,265,476
Creditors: amounts falling due within one year
18
(768,130)
(961,893)
Net current assets
4,469,764
4,303,583
Total assets less current liabilities
11,578,902
11,363,966
Creditors: amounts falling due after more than one year
19
(380,486)
(578,996)
Provisions for liabilities
Deferred tax liability
21
422,775
412,710
(422,775)
(412,710)
Net assets
10,775,641
10,372,260
Capital and reserves
Called up share capital
23
100
100
Share premium account
918
918
Revaluation reserve
485,544
64,500
Profit and loss reserves
10,289,079
10,306,742
Total equity
10,775,641
10,372,260
These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.true
The financial statements were approved and signed by the director and authorised for issue on 12 February 2024
J Winfield
Director
Company registration number 01099533 (England and Wales)
HAVENCARE MANAGEMENT LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2023
- 10 -
Share capital
Share premium account
Revaluation reserve
Profit and loss reserves
Total
Notes
£
£
£
£
£
Balance at 1 July 2021
100
918
64,500
9,343,054
9,408,572
Year ended 30 June 2022:
Profit and total comprehensive income
-
-
-
1,005,288
1,005,288
Dividends
10
-
-
-
(41,600)
(41,600)
Balance at 30 June 2022
100
918
64,500
10,306,742
10,372,260
Year ended 30 June 2023:
Profit and total comprehensive income
-
-
-
592,202
592,202
Dividends
10
-
-
-
(188,821)
(188,821)
Transfers
-
-
421,044
(421,044)
-
Balance at 30 June 2023
100
918
485,544
10,289,079
10,775,641
HAVENCARE MANAGEMENT LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
- 11 -
1
Accounting policies
Company information
Havencare Management Limited is a private company limited by shares incorporated in England and Wales. The registered office is 227 Bury Road, Rawtenstall, Rossendale, BB4 6DJ.
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, modified to include the revaluation of investment properties. The principal accounting policies adopted are set out below.
This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:
The company has taken advantage of the exemption under section 400 of the Companies Act 2006 not to prepare consolidated accounts. The financial statements present information about the company as an individual entity and not about its group.
Havencare Management Limited is a wholly owned subsidiary of Havencare Management Holdings Ltd and the results of Havencare Management Limited are included in the consolidated financial statements of Havencare Management Holdings Ltd which are available from 227 Bury Road, Rawtenstall, Rossendale, BB4 6DJ.
1.2
Going concern
Atruet the time of approving the financial statements, the director has a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus the director continues to adopt the going concern basis of accounting in preparing the financial statements.
1.3
Turnover
Turnover is recognised net of VAT and other sales related taxes.
Revenue from the sale of goods and services are recognised when the significant risks and rewards of ownership of the goods and services have passed to the buyer, the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
HAVENCARE MANAGEMENT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 12 -
1.4
Intangible fixed assets - goodwill
Goodwill represents the excess of the cost of acquisition of unincorporated businesses 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 five 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.
1.5
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:
Freehold buildings
2%
Leasehold buildings
2%
Plant and machinery
10 - 20%
Motor vehicles
20 - 33.3%
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.6
Investment properties
Investment property, which is property held to earn rentals and/or for capital appreciation, is initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Subsequently it is measured at fair value at the reporting end date. The surplus or deficit on revaluation is recognised in profit or loss.
1.7
Fixed asset investments
Interests in subsidiaries and associates are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
1.8
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.
HAVENCARE MANAGEMENT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 13 -
1.9
Cash at bank and in hand
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 company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans and loans from fellow group companies 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.
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.
1.11
Equity instruments
Equity instruments issued by the company 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 company.
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 company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
HAVENCARE MANAGEMENT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 14 -
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 when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.13
Employee benefits
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
1.14
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.15
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.
2
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the director is 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.
The investment properties are shown at their fair value at the balance sheet date. These valuations are based on the market data available to the directors.
A provision for impairment of trade debtors is established when there is no objective evidence that the amounts due will not be collected according to the original terms and conditions.
HAVENCARE MANAGEMENT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 15 -
3
Turnover
2023
2022
£
£
Turnover analysed by class of business
Funeral Services
6,567,546
6,431,331
All turnover arose within the United Kingdom.
4
Operating profit
2023
2022
Operating profit for the year is stated after charging:
£
£
Fees payable to the company's auditor for the audit of the company's financial statements
27,795
33,720
Depreciation of owned tangible fixed assets
72,278
65,622
Depreciation of tangible fixed assets held under finance leases
133,309
148,505
(Profit)/loss on disposal of tangible fixed assets
3,895
Operating lease charges
35,698
34,447
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Employees
91
83
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
1,819,764
1,578,555
Social security costs
149,226
127,462
Pension costs
31,758
27,864
2,000,748
1,733,881
6
Director's remuneration
2023
2022
£
£
Remuneration for qualifying services
9,096
17,835
HAVENCARE MANAGEMENT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 16 -
7
Interest payable and similar expenses
2023
2022
£
£
Interest on finance leases and hire purchase contracts
17,253
18,987
8
Fair value movement of investment properties
2023
2022
£
£
Changes in the fair value of investment properties
118,000
120,544
9
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
151,089
226,952
Adjustments in respect of prior periods
(8)
Total current tax
151,081
226,952
Deferred tax
Origination and reversal of timing differences
10,065
11,642
Total tax charge
161,146
238,594
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
753,348
1,243,882
Expected tax charge based on the standard rate of corporation tax in the UK of 20.50% (2022: 19.00%)
154,436
236,338
Tax effect of expenses that are not deductible in determining taxable profit
65
Adjustments in respect of prior years
(8)
Permanent capital allowances in excess of depreciation
4,936
(603)
Remeasurement of deferred tax for changes in tax rates
1,782
2,794
Taxation charge for the year
161,146
238,594
HAVENCARE MANAGEMENT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 17 -
10
Dividends
2023
2022
£
£
Final paid
188,821
41,600
11
Intangible fixed assets
Goodwill
£
Cost
At 1 July 2022 and 30 June 2023
668,001
Amortisation and impairment
At 1 July 2022 and 30 June 2023
668,001
Carrying amount
At 30 June 2023
At 30 June 2022
12
Tangible fixed assets
Freehold buildings
Leasehold buildings
Plant and machinery
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 July 2022
3,593,459
1,859,665
548,397
2,434,396
8,435,917
Additions
35,462
8,696
11,090
81,094
136,342
At 30 June 2023
3,628,921
1,868,361
559,487
2,515,490
8,572,259
Depreciation and impairment
At 1 July 2022
193,186
108,659
422,727
1,246,948
1,971,520
Depreciation charged in the year
17,723
7,643
28,609
151,612
205,587
At 30 June 2023
210,909
116,302
451,336
1,398,560
2,177,107
Carrying amount
At 30 June 2023
3,418,012
1,752,059
108,151
1,116,930
6,395,152
At 30 June 2022
3,400,273
1,751,006
125,670
1,187,448
6,464,397
The net carrying value of tangible fixed assets includes the following in respect of assets held under finance leases or hire purchase contracts.
2023
2022
£
£
Motor vehicles
622,723
726,076
HAVENCARE MANAGEMENT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 18 -
13
Investment property
2023
£
Fair value
At 1 July 2022
585,000
Net gains through fair value adjustments
118,000
At 30 June 2023
703,000
The 2023 valuations were made by the directors, on an open market value for existing use basis.
14
Fixed asset investments
2023
2022
Notes
£
£
Investments in subsidiaries
15
10,986
10,986
15
Subsidiaries
Details of the company's subsidiaries at 30 June 2023 are as follows:
Name of undertaking
Registered office
Class of
% Held
shares held
Direct
R H Ormerod Limited
227 Bury Road Rawtenstall, Rossendale, Lancashire, England, BB4 6DJ
Ordinary
100.00
Todmorden Funeral Services Limited
227 Bury Road Rawtenstall, Rossendale, Lancashire, England, BB4 6DJ
Ordinary
51.00
16
Stocks
2023
2022
£
£
Finished goods and goods for resale
93,652
107,650
17
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
510,944
836,011
Corporation tax recoverable
70,950
Amounts owed by group undertakings
2,144,416
2,130,940
Other debtors
696,973
127,327
Prepayments and accrued income
130,900
139,288
3,554,183
3,233,566
Amounts owed by group undertakings are unsecured, interest free and repayable on demand.
HAVENCARE MANAGEMENT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
17
Debtors
(Continued)
- 19 -
18
Creditors: amounts falling due within one year
2023
2022
Notes
£
£
Bank loans
83,301
90,563
Obligations under finance leases
20
121,482
158,587
Trade creditors
301,303
376,465
Amounts owed to group undertakings
10,935
10,935
Corporation tax
215
94,159
Other taxation and social security
82,680
76,066
Other creditors
53,286
51,505
Accruals and deferred income
114,928
103,613
768,130
961,893
Amounts owed to group undertakings are unsecured, interest free and repayable on demand.
Obligations due under finance leases are secured on the assets to which the agreement relates.
19
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Bank loans and overdrafts
248,035
327,356
Obligations under finance leases
20
132,451
251,640
380,486
578,996
Obligations due under finance leases are secured on the assets to which the agreement relates.
The bank loans are secured on the company's freehold and leasehold land and buildings and a related party guarantee of £100,000. They are repayable by the contractual repayment terms of each loan and incur interest of 3.5% (2022: 3.5%)
20
Finance lease obligations
2023
2022
Future minimum lease payments due under finance leases:
£
£
Within one year
121,482
158,587
In two to five years
132,451
251,640
253,933
410,227
HAVENCARE MANAGEMENT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 20 -
21
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2023
2022
Balances:
£
£
Fixed asset timing differences
314,064
333,302
Short term timing differences
(1,853)
(1,656)
Capital gains/(losses)
110,564
81,064
422,775
412,710
2023
Movements in the year:
£
Liability at 1 July 2022
412,710
Charge to profit or loss
10,065
Liability at 30 June 2023
422,775
22
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
31,758
27,864
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
23
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
100
100
100
100
HAVENCARE MANAGEMENT LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 21 -
24
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2023
2022
£
£
Within one year
38,929
33,629
Between two and five years
1,362
4,631
40,291
38,260
25
Events after the reporting date
Post year end, Havencare Management Limited purchased Darwen Funeral Service for £627,000 on 8th September 2023.
26
Related party transactions
As permitted by FRS102, the company has chosen not to disclose transactions and balances between fellow group companies.
At the year end an amount of £31,293 (2022: £178) was owed to the company associated through common control. The company made sales and purchases of goods and services amounting to £3,416 (2022: £6,037) and £nil (2022: £15,750) respectively.
At the year end an amount of £672,003 (2022: £289,686) was owed by the company to a company associated through common control. The company made sales of goods and services amounting to £645,245 (2022: £793,151).
27
Directors' transactions
Description
% Rate
Opening balance
Amounts advanced
Amounts repaid
Closing balance
£
£
£
£
Director Loan Account
-
31,711
101,479
(133,190)
-
31,711
101,479
(133,190)
-
The maximum amount outstanding during the year was £101,479 (2022: £76,386).
28
Ultimate controlling party
The parent company is Havencare Management Holdings Limited. The ultimate joint controlling parties of the parent company are Mr and Mrs Winfield.
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