Year Ended
Registration number:
Budock Vean Holdings Limited
Contents
Company Information |
|
Strategic Report |
|
Director's Report |
|
Statement of Director's Responsibilities |
|
Independent Auditor's Report |
|
Consolidated Statement of Income and Retained Earnings |
|
Consolidated Balance Sheet |
|
Balance Sheet |
|
Consolidated Statement of Cash Flows |
|
Notes to the Financial Statements |
Budock Vean Holdings Limited
Company Information
Registered office |
|
Auditors |
|
Director |
M E Barlow |
Budock Vean Holdings Limited
Strategic Report
Year Ended 31 December 2022
The director presents his strategic report for the year ended 31 December 2022.
Principal activity
The principal activity of the group is that of hoteliers and providers of self catering accommodation, operating the Budock Vean Hotel and Budock Vean Holidays, and the development of lodges for sale to third parties through Budock Vean Developments.
Fair review of the business
The Directors announce a loss before tax for the year of £278,718 (2021 profit - £673,631).
Revenue in the period has risen to £3.48m (2021 - £3.10m), largely due to lifting of Covid restrictions. Inflationary pressures have adversely impacted on margin leading to the gross profit margin decreasing to 59.36% (2021 - 62.59%). The prior year results were impacted by Covid 19 restrictions, coupled with government support measures through government grant schemes, reduced rates costs and reduced rates of VAT, which returned to pre Covid 19 levels during the period. The removal of restrictions has meant that the hotel has been able to trade for the full year to 31 December 2022, however inflationary pressures in areas such as wages and light and heat have impacted profitability. In addition the company received £nil (2021 - 276k) in respect of the government's Coronavirus Job Retention Scheme. The company reports an operating profit of 47k (2021 - profit of £793k).
The group's key financial and other performance indicators during the year were as follows:
Financial KPIs |
Unit |
2022 |
2021 |
Revenue |
£000 |
3,481 |
3,104 |
Operating (loss)/profit |
£000 |
47 |
793 |
EBITDA |
£000 |
277 |
963 |
Staff numbers |
No. |
83 |
79 |
Net debt |
£000 |
5,022 |
3,997 |
Budock Vean Holdings Limited
Strategic Report
Year Ended 31 December 2022
Principal risks and uncertainties
The group is exposed to the same risks as other companies within the leisure industry, however the Directors feel that through a robust assessment of the market that the group is well positioned to deal with any risks and uncertainties, whilst being able to capitalise on any opportunities, as they arise.
The group operates in a competitive marketplace however the directors believe that the ongoing investment in the hotel facilities, coupled with its reputation for standards of service, mitigates this risk and supports retained customers.
Environmental matters
Since 2004 the Budock Vean has been one of the most proactive hotels in Cornwall in terms of instigating a suitable environmentally friendly policy. We are an ambassador for COAST; a member of the International Tree Foundation and a corporate member of Cornwall Wildlife Trust. We are totally committed to purchasing as many products and services as possible from Cornwall and particularly local based suppliers, on the basis that they meet our requirements of value, quality and reliability of supply. Menus clearly show items that have been purchased locally.
We believe that one of the greatest assets of the hotel is its grounds and location nestled on the banks of the Helford River. This is an Area of Outstanding Natural Beauty (AONB) and a Special Area of Conservation (SAC) which is rich in natural beauty and high biodiversity.
We see our role as custodians of this wonderful natural asset and are committed to its long term sustainability. We take all reasonable measures to preserve and maintain the immediate and wider environment for the enjoyment of future generations. The continued commercial success of the hotel will further ensure the long term preservation and sustainability of the Budock Vean Hotel Estate and its surrounds.
Approved by the
......................................... |
Budock Vean Holdings Limited
Director's Report
Year Ended 31 December 2022
The director presents his report and the for the year ended 31 December 2022.
Directors of the group
The directors who held office during the year were as follows:
Financial instruments
Objectives and policies
The groups principal financial instruments comprise of bank balances, trade creditors, deposits in advance from customers and bank loans. The main purpose of these instruments is to raise funds for the groups main operations. The Directors believe that the group is dealing proactively with the risks and uncertainties which it faces.
Price risk, credit risk, liquidity risk and cash flow risk
The risks applicable to financial instruments are illustrated below:
Liquidity risk
The group manages this particular risk through a combination of compiling projections and regular review of the available management information by the Directors.
Price risk
The group operates a set tariff for customers staying at the hotel. The tariff is set by the Directors and regularly reviewed in order to ensure that the price is appropriate. Tariff changes are also factored into projections that enable the group to ensure that sufficient funds are available.
Deposits received in advance help fund the group and therefore setting tariffs to ensure that they encourage payments in advance is an important element in assisting cash flow.
Operational risk
The Directors are aware of the continual changes in laws and regulations and the associated compliance costs and plan ahead accordingly.
Credit risk
Given that customers are required to pay a deposit to reserve a room, and that all accounts are liable for settlement upon arrival the Directors do not believe that the group is adversely affected by credit risk.
Budock Vean Holdings Limited
Director's Report
Year Ended 31 December 2022
Going concern
The Director intends to sell the trade and assets of the group and therefore does not consider it appropriate to adopt the going concern basis of accounting.
Further commentary in this area is provided within note 2 to the financial statements.
Director's liabilities
Appropriate directors' and officers' liability cover is in place in respect of all the Directors of the group.
Disclosure of information to the auditor
The director has taken steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditor is aware of that information. The director confirms that there is no relevant information that he knows of and of which he knows the auditor is unaware.
Approved and authorised by the
......................................... |
Budock Vean Holdings Limited
Statement of Director's Responsibilities
The director acknowledges his responsibilities 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 group and the company and of the profit or loss of the group for that period. In preparing these financial statements, the director is required to:
• |
select suitable accounting policies and apply them consistently; |
• |
make judgements and accounting estimates that are reasonable and prudent; |
• |
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and |
• |
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business. |
The director is responsible for keeping adequate accounting records that are sufficient to show and explain the Group's and the company's transactions and disclose with reasonable accuracy at any time the financial position of the Group and the company and enable him to ensure that the financial statements comply with the Companies Act 2006. He is also responsible for safeguarding the assets of the of the Group and the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Budock Vean Holdings Limited
Independent Auditor's Report to the Members of Budock Vean Holdings Limited
Opinion
We have audited the financial statements of Budock Vean Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 December 2022, which comprise the Consolidated Statement of Income and Retained Earnings, Consolidated Balance Sheet, Balance Sheet, Consolidated Statement of Cash Flows, and Notes to the Financial Statements, including a summary of 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 group's and the parent company's affairs as at 31 December 2022 and of the group's loss for the year then ended; |
• | have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and |
• | have been prepared in accordance with the requirements of the Companies Act 2006. |
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the auditor responsibilities for the audit of the financial statements section of our report. We are independent of the group 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.
Emphasis of matter - financial statements prepared on a basis other than going concern
We draw your attention to Note 2 to the financial statements which explains that the director intends to sell the trade and assets of the group and therefore does not consider it to be appropriate to adopt the going concern basis of accounting in preparing the financial statements. Accordingly the financial statements have been prepared on a basis other than going concern as described in Note 2. Our opinion is not modified in respect of this matter.
Other information
The directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. 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.
In connection with our audit of the financial statements, 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 audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. 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.
Budock Vean Holdings Limited
Independent Auditor's Report to the Members of Budock Vean Holdings Limited
Opinion on other matter prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
• |
the information given in the Strategic Report and 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 Director's Report have been prepared in accordance with applicable legal requirements. |
Matters on which we are required to report by exception
In the light of our knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report and the Director's Report.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
• | adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or |
• | the parent company financial statements are not in agreement with the accounting records and returns; or |
• | certain disclosures of directors' remuneration specified by law are not made; or |
• | we have not received all the information and explanations we require for our audit. |
Responsibilities of the director
As explained more fully in the Statement of Director's Responsibilities set out on page 6, 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 group’s and 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 director either intends to liquidate the group or 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.
Budock Vean Holdings Limited
Independent Auditor's Report to the Members of Budock Vean Holdings Limited
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:
As part of our audit planning we obtained an understanding of the legal and regulatory framework that is applicable to the entity and industry/sector in which it operates to identify the key laws and regulations affecting the entity. As part of this assessment process we have identified key laws and regulations of the entity and investigated whether any of these have breached in the year.
The key laws and regulations we identified were:
- The Health and Safety at Work Act 1974
- Credit Card Order 1990
- Employer's Liability (Compulsory Insurance) Act 1969
- Licensing Act 1964
- GDPR
We also considered those laws and regulations that have a direct impact on the preparation of the financial statements, primarily the Companies Act 2006.
We discussed with management how the compliance of these laws and regulations is monitored and discussed policies and procedures in place. We also identified the individuals who have responsibility for ensuring that the entity complies with laws and regulations and deals with reporting any issues if they arise.
As part of our planning procedures, we assessed the risk of any non-compliance with laws and regulations. Our procedures involved the following:
- Enquiries of management and those charged with governance regarding their knowledge of any non-compliance with laws and regulations that could affect the financial statements;
- Reviewed legal and professional costs to identify any possible non-compliance or legal costs in respect of any potential non-compliance; and
- Obtained copies of documentation proving compliance with relevant laws and regulations where possible.
As part of our enquiries we discussed with management whether there have been any known instances, allegations or suspicions of fraud, of which there were none.
We also evaluated the risk of fraud through management override including that arising from management's incentives. The key risk we identified was financial covenant compliance and we determined that the principal risks were related to the overstatement of EBITDA, either through overstating revenue, understating expenditure, or management bias in relation to accounting estimates.
In response to the identified risk, as part of our audit work, we:
- Used data analytics to test journal entries throughout the year, for appropriateness;
- Reviewed estimates and judgements made in the financial statements for any indication of bias and challenged assumptions used by management in making the estimates.
Budock Vean Holdings Limited
Independent Auditor's Report to the Members of Budock Vean Holdings Limited
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. This risk increases the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements as we are less likely to become aware of instances of non-compliance. 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, collusion, omission or misrepresentation.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
Use of our report
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
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Lowin House
Tregolls Road
Cornwall
TR1 2NA
Budock Vean Holdings Limited
Consolidated Statement of Income and Retained Earnings for the Year Ended 31 December 2022
Note |
2022 |
2021 |
|
Turnover |
|
|
|
Cost of sales |
( |
( |
|
Gross profit |
|
|
|
Establishment costs |
( |
( |
|
Administrative expenses |
( |
( |
|
Other operating income |
- |
|
|
Operating profit |
|
|
|
Interest payable and similar charges |
( |
( |
|
Impairment |
(158,383) |
- |
|
(Loss)/profit before tax |
( |
|
|
Taxation |
|
( |
|
(Loss)/profit for the financial year |
( |
|
|
Profit/(loss) attributable to: |
|||
Owners of the company |
( |
|
|
Retained earnings brought forward |
460,627 |
85,248 |
|
Retained earnings carried forward |
319,332 |
460,627 |
Budock Vean Holdings Limited
Consolidated Balance Sheet
31 December 2022
Note |
2022 |
2021 |
|
Fixed assets |
|||
Intangible assets |
- |
( |
|
Tangible assets |
|
|
|
|
|
||
Current assets |
|||
Stocks |
|
|
|
Debtors |
|
|
|
Cash at bank and in hand |
|
|
|
|
|
||
Creditors: Amounts falling due within one year |
( |
( |
|
Net current liabilities |
( |
( |
|
Total assets less current liabilities |
|
|
|
Creditors: Amounts falling due after more than one year |
( |
( |
|
Provisions for liabilities |
( |
( |
|
Net assets |
|
|
|
Capital and reserves |
|||
Called up share capital |
|
|
|
Share premium reserve |
|
|
|
Profit and loss account |
|
|
|
Equity attributable to owners of the company |
|
|
|
Total equity |
|
|
Approved and authorised by the
......................................... |
Company Registration Number: 00863550
Budock Vean Holdings Limited
Balance Sheet
31 December 2022
Note |
2022 |
2021 |
|
Fixed assets |
|||
Investments |
|
|
|
Current assets |
|||
Debtors |
|
|
|
Creditors: Amounts falling due within one year |
( |
( |
|
Net current assets |
|
|
|
Total assets less current liabilities |
|
|
|
Creditors: Amounts falling due after more than one year |
( |
( |
|
Net assets |
|
|
|
Capital and reserves |
|||
Called up share capital |
|
|
|
Share premium reserve |
|
|
|
Profit and loss account |
|
|
|
Total equity |
|
|
Approved and authorised by the
......................................... |
Company Registration Number: 00863550
Budock Vean Holdings Limited
Consolidated Statement of Cash Flows
Year Ended 31 December 2022
Note |
2022 |
2021 |
|
Cash flows from operating activities |
|||
(Loss)/profit for the year |
( |
|
|
Adjustments to cash flows from non-cash items |
|||
Depreciation and amortisation |
|
|
|
Loss on disposal of tangible assets |
|
- |
|
Impairment of fixed assets |
|
- |
|
Finance costs |
|
|
|
Income tax expense |
( |
|
|
|
|
||
Working capital adjustments |
|||
Decrease/(increase) in stocks |
|
( |
|
Decrease/(increase) in trade debtors and other debtors |
|
( |
|
(Decrease)/increase in trade creditors and other creditors |
( |
|
|
Cash generated from operations |
|
|
|
Income taxes paid |
( |
( |
|
Net cash flow from operating activities |
|
|
|
Cash flows from investing activities |
|||
Acquisitions of tangible assets |
( |
( |
|
Cash flows from financing activities |
|||
Interest paid |
( |
( |
|
Repayment of bank borrowing |
(205,000) |
(181,667) |
|
Proceeds from issue of shares classified as liabilities |
645,100 |
- |
|
Payments to finance lease creditors |
( |
( |
|
Net cash flows from financing activities |
|
( |
|
Net (decrease)/increase in cash and cash equivalents |
( |
|
|
Cash and cash equivalents at 1 January |
|
|
|
Cash and cash equivalents at 31 December |
408,459 |
1,015,444 |
Budock Vean Holdings Limited
Notes to the Financial Statements
Year Ended 31 December 2022
General information |
The company is a private company limited by share capital, incorporated in England and Wales.
The principal place of trade for the group is the same as its registered office.
The address of its registered office is:
Accounting policies |
Summary of significant accounting policies and key accounting estimates
The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.
Statement of compliance
The group's financial statements have been prepared in accordance with FRS102 - the Financial Reporting Standard applicable in the UK and Republic of Ireland.
The preparation of financial statements in conformity with FRS102 requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the group's accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in note 2.
Basis of preparation
These financial statements have been prepared using the historical cost convention.
The presentational currency of the financial statements is Pound Sterling, being the functional currency of the primary economic environment in which the company operates.
Monetary amounts in these financial statements are rounded to the nearest pound.
Budock Vean Holdings Limited
Notes to the Financial Statements
Year Ended 31 December 2022
Basis of consolidation
The group financial statements consolidate the financial statements of the company and its subsidiary undertakings drawn up to 31 December 2022.
No income statement is presented for the company as permitted by section 408 of the Companies Act 2006. The company made a loss after tax for the financial year of £15,003 (2021 - loss of £122).
A subsidiary is an entity controlled by the Company. Control is achieved where the Company has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities.
The purchase method of accounting is used to account for business combinations that result in the acquisition of subsidiaries by the Group. The cost of a business combination is measured as the fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the business combination. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. Any excess of the cost of the business combination over the acquirer’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities recognised is recorded as goodwill.
Inter-company transactions, balances and unrealised gains on transactions between the Company and its subsidiaries, which are related parties, are eliminated in full.
Intra-group losses are also eliminated but may indicate an impairment that requires recognition in the consolidated financial statements.
Summary of disclosure exemptions
FRS102 allows a qualifying entity certain disclosure exemptions subject to certain conditions which the company has complied with. On this basis the company has taken advantage of the following exemptions:
i) From preparing a statement of cash flows, on the basis that it is a qualifying entity and the consolidated statement of cash flows included in these financial statements includes the Company's cash flows;
ii) From the financial instrument disclosures, required under FRS102 paragraphs 11.39 to 11.48A as the information is provided in the consolidated financial statement disclosures.
The group and company has also taken advantage of the exemption under FRS102 paragraph 33.1A in respect of transactions between members of the group, on the basis that the group companies are 100% owned.
Going concern
The financial statements have been prepared on a basis other than that of going concern as it is the intention of the director that the assets of the group will be sold after the balance sheet date. The hotel within the group is being marketed for sale to a third party and the outstanding loans will be repaid. Future costs of terminating the business that were not committed to at the balance sheet date are not included.
Budock Vean Holdings Limited
Notes to the Financial Statements
Year Ended 31 December 2022
Revenue recognition
Revenue comprises the fair value of the consideration received, or receivable for the provision of services in the ordinary course of the Group's activities. Revenue is shown net of sales/value added tax, returns, rebates and discounts and after eliminating sales within the company.
Revenue represents the core operations of the group, which includes:
- The provision of services associated with the running of a hotel, with ancillary facilities including a restaurant, bar, golf course and spa.
- The construction of lodges on the hotel premises for resale, and subsequent lettings management services.
In respect of accommodation income, revenue is recognised at the point of a customer staying in a room. Deposits are received in advance of customer stays in accordance with the group booking policies, and these are treated as payments on account and recognised within creditors due in less than one year.
Food, beverage, golf and other hotel income are recognised at the point of sale.
Turnover arising from the sale of lodges is recognised at the point of practical completion. Instalment payments received from purchasers prior to completion have been deferred and are recognised within accruals and deferred income. The associated costs of development prior to sale are similarly recognised as work in progress. The profit arising from the disposal of land on which lodge development has taken place has been recognised within other operating income. The sale of land is recognised on completion.
Lettings commissions are recognised at the point of a customer staying in a room.
Revenue derives from the activities of the group which are wholly undertaken in the UK.
Tax
The tax expense for the period comprises current and deferred tax. Tax is recognised in profit or loss, except that a change attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.
Current or deferred tax liabilities are not discounted.
The current corporation tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the group operates and generates taxable income.
Deferred income tax is recognised on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements and on unused tax losses or tax credits in the Group. Deferred income tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.
The carrying amount of deferred tax assets are reviewed at each reporting date and a valuation allowance is set up against deferred tax assets so that the net carrying amount equals the highest amount that is more likely than not to be recovered based on current or future taxable profit.
Budock Vean Holdings Limited
Notes to the Financial Statements
Year Ended 31 December 2022
Property, plant and equipment
Tangible assets are stated in the statement of financial position at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.
The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.
Depreciation
Depreciation is charged so as to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:
Asset class |
Depreciation method and rate |
Freehold buildings |
Straight line over 50 years |
Furniture, fittings and equipment |
Between 10% to 25% reducing balance |
Intangible assets
Negative goodwill arising on an acquisition is recognised on the face of the balance sheet on the acquisition date and subsequently the excess up to the fair value of non-monetary assets acquired is recognised in profit or loss in the periods in which the non-monetary assets are recovered.
Amortisation
Amortisation is provided on intangible assets so as to write off the cost, less any estimated residual value, over their useful life as follows:
Asset class |
Amortisation method and rate |
Negative goodwill |
Straight line over 50 years |
Investments
Investments represent the company investment in subsidiary undertakings, which are held in the financial statements at cost.
Other investments represents monies advanced to the Helford River Ferry, and is stated at cost less accumulated impairment losses.
Borrowings
Interest-bearing borrowings are initially recorded at fair value, net of transaction costs. Interest-bearing borrowings are subsequently carried at amortised cost, with the difference between the proceeds, net of transaction costs, and the amount due on redemption being recognised as a charge to the Profit and Loss Account over the period of the relevant borrowing.
Interest expense is recognised on the basis of the effective interest method and is included in interest payable and similar charges.
Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least twelve months after the reporting date.
Budock Vean Holdings Limited
Notes to the Financial Statements
Year Ended 31 December 2022
Leases
Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease. Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee.
Assets held under finance leases are recognised at the lower of their fair value at inception of the lease and the present value of the minimum lease payments. These assets are depreciated on a straight-line basis over the shorter of the useful life of the asset and the lease term. The corresponding liability to the lessor is included in the Balance Sheet as a finance lease obligation.
Lease payments are apportioned between finance costs in the Profit and Loss Account and reduction of the lease obligation so as to achieve a constant periodic rate of interest on the remaining balance of the liability.
Budock Vean Holdings Limited
Notes to the Financial Statements
Year Ended 31 December 2022
Financial instruments
Classification
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. All financial instruments are classified as basic.
Recognition and measurement
Financial instruments are recognised in the company's statement of financial position when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to
settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets, which include trade and other receivables and cash and bank balances, are initially measured at transaction price, including transaction costs, and are subsequently carried at the
undiscounted amount of the cash or other consideration expected to be paid or received, after taking account of impairment adjustments.
Basic financial liabilities, including trade and other payables, bank loans, and loans from fellow group companies are initially measured at transaction price, including transaction costs, and are
subsequently carried at the undiscounted amount of the cash or other consideration expected to be paid or received, after taking account of impairment adjustments.
Impairment
Financial assets 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.
Defined contribution pension obligation
A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the group has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.
Contributions to defined contribution plans are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.
Budock Vean Holdings Limited
Notes to the Financial Statements
Year Ended 31 December 2022
Judgements
Management evaluate estimates and judgements on an annual basis, and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. |
In applying the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amounts 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 if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
In the opinion of the directors the key areas of judgement in the financial statements are as follows:
Carrying value of fixed assets (note 12)
At the balance sheet date the carrying value of freehold land and buildings is £6,138,362 (2021 - £6,188,597).
It is the group's practice to maintain the hotel building in a continual state of sound repair and to extend and make improvements thereto from time to time and accordingly the directors consider that the lives of these assets are so long and residual values so high that their depreciation is immaterial.
Turnover |
The analysis of the group's revenue for the year from continuing operations is as follows:
2022 |
2021 |
|
Rendering of services |
|
|
Budock Vean Holdings Limited
Notes to the Financial Statements
Year Ended 31 December 2022
Other operating income |
The analysis of the group's other operating income for the year is as follows:
2022 |
2021 |
|
Other income |
- |
|
Operating (loss)/profit |
Arrived at after charging/(crediting)
2022 |
2021 |
|
Depreciation expense |
|
|
Amortisation expense |
( |
( |
Operating lease expense - plant and machinery |
|
|
Loss on disposal of property, plant and equipment |
|
- |
Staff costs |
The aggregate payroll costs (including directors' remuneration) were as follows:
2022 |
2021 |
|
Wages and salaries |
|
|
Social security costs |
|
|
Pension costs, defined contribution scheme |
|
|
Other employee expense |
|
|
|
|
The average number of persons employed by the group (including the director) during the year, analysed by category was as follows:
2022 |
2021 |
|
Hotel staff |
|
|
|
|
Budock Vean Holdings Limited
Notes to the Financial Statements
Year Ended 31 December 2022
Director's remuneration |
The director's remuneration for the year was as follows:
2022 |
2021 |
|
Remuneration |
|
|
Auditors' remuneration |
2022 |
2021 |
|
Audit of these financial statements |
8,183 |
7,439 |
The audit fee for the company is borne by a subsidiary undertaking and is £520 (2021 - £475).
Interest payable and similar expenses |
2022 |
2021 |
|
Interest on bank overdrafts and borrowings |
|
|
Interest on preference shares |
|
|
Interest on obligations under finance leases and hire purchase contracts |
|
|
Interest expense on other finance liabilities |
|
|
|
|
Budock Vean Holdings Limited
Notes to the Financial Statements
Year Ended 31 December 2022
Taxation |
Tax charged/(credited) in the profit and loss account
2022 |
2021 |
|
Current taxation |
||
UK corporation tax |
- |
|
UK corporation tax adjustment to prior periods |
|
- |
10,989 |
61,510 |
|
Deferred taxation |
||
Arising from origination and reversal of timing differences |
( |
|
Tax (receipt)/expense in the income statement |
( |
|
The tax on profit before tax for the year is lower than the standard rate of corporation tax in the UK (2021 - lower than the standard rate of corporation tax in the UK) of
The differences are reconciled below:
2022 |
2021 |
|
(Loss)/profit before tax |
( |
|
Corporation tax at standard rate |
( |
|
Effect of expense not deductible in determining taxable profit (tax loss) |
|
|
Effect of tax losses |
- |
|
Other tax effects for reconciliation between accounting profit and tax expense (income) |
( |
|
Total tax (credit)/charge |
( |
|
Budock Vean Holdings Limited
Notes to the Financial Statements
Year Ended 31 December 2022
Deferred tax
Group
Deferred tax assets and liabilities
2022 |
Asset |
Liability |
Capital allowances in excess of depreciation |
- |
|
Pension costs deductible when paid |
- |
( |
Deferred tax on revalued assets |
- |
|
Tax losses carried forward |
- |
( |
Rolled over gains |
- |
|
- |
|
2021 |
Asset |
Liability |
Capital allowances in excess of depreciation |
- |
|
Pension costs deductible when paid |
- |
( |
Deferred tax on revalued assets |
- |
|
Rolled over gains |
- |
|
- |
|
Budock Vean Holdings Limited
Notes to the Financial Statements
Year Ended 31 December 2022
Intangible assets |
Group
Goodwill |
Total |
|
Cost or valuation |
||
At 1 January 2022 |
( |
( |
At 31 December 2022 |
( |
( |
Amortisation |
||
At 1 January 2022 |
( |
( |
Amortisation charge |
( |
( |
Impairment |
( |
( |
At 31 December 2022 |
( |
( |
Carrying amount |
||
At 31 December 2022 |
- |
- |
At 31 December 2021 |
( |
( |
The release of negative goodwill through profit and loss is recognised within administrative expenses.
The negative goodwill has been released completely to reflect the valuation of the fixed assets (see note 12) in accordance with the basis of preparation being other than going concern.
Budock Vean Holdings Limited
Notes to the Financial Statements
Year Ended 31 December 2022
Tangible assets |
Group
Land and buildings |
Furniture, fittings and equipment |
Total |
|
Cost or valuation |
|||
At 1 January 2022 |
|
|
|
Impairment |
( |
- |
( |
Additions |
|
|
|
Disposals |
( |
- |
( |
At 31 December 2022 |
|
|
|
Depreciation |
|||
At 1 January 2022 |
- |
|
|
Charge for the year |
- |
|
|
At 31 December 2022 |
- |
|
|
Carrying amount |
|||
At 31 December 2022 |
|
|
|
At 31 December 2021 |
|
|
|
Impairment
Freehold land and buildings
Assets held under finance leases and hire purchase contracts
The net carrying amount of tangible assets includes the following amounts in respect of assets held under finance leases and hire purchase contracts:
2022 |
2021 |
|
Furniture, fittings and equipment |
14,354 |
38,597 |
The depreciation charge on leased assets recognised in profit and loss in the year was £4,785 (2021 - £12,866).
Budock Vean Holdings Limited
Notes to the Financial Statements
Year Ended 31 December 2022
Investments |
Company
Subsidiaries |
£ |
Cost or valuation |
|
At 1 January 2022 and 31 December 2019 |
|
Provision |
|
At 1 January 2022 and 31 December 2019 |
( |
Carrying amount |
|
At 31 December 2022 |
|
At 31 December 2021 |
|
Details of undertakings
Details of the investments in which the company holds 20% or more of the nominal value of any class of share capital are as follows:
Undertaking |
Holding |
Proportion of voting rights and shares held |
||
2022 |
2021 |
|||
Subsidiary undertakings |
||||
|
Ordinary and deferred |
|
|
|
|
Ordinary |
|
|
|
|
Ordinary |
|
|
|
Budock Vean Holdings Limited owns 100% of the share capital of Budock Vean Hotel Limited. Budock Vean Hotel Limited in turn owns the share capital of Budock Vean Developments Limited and Budock Vean Holidays Limited.
The principal operation of Budock Vean Hotel Limited is that of a hotelier. Budock Vean Developments Limited operates as a property development company, with the principal operation of Budock Vean Holidays being lettings management.
The registered office of Budock Vean Hotel Limited and Budock Vean Developments Limited is Budock Vean Hotel, Mawnan Smith, Falmouth, TR11 5LG.
The registered office of Budock Vean Holidays Limited is Lowin House, Tregolls Road, Truro, TR1 2NA.
Budock Vean Holdings Limited
Notes to the Financial Statements
Year Ended 31 December 2022
Inventories |
Group |
Company |
|||
2022 |
2021 |
2022 |
2021 |
|
Work in progress |
|
|
- |
- |
Other inventories |
|
|
- |
- |
|
|
- |
- |
Amounts classified as work in progress relate to the development of lodges on the hotel grounds.
Other inventories relate to stock items held for the delivery of services to customers, including food, bar and spa stocks.
Group
Debtors |
Group |
Company |
||||
Note |
2022 |
2021 |
2022 |
2021 |
|
Trade debtors |
|
|
- |
- |
|
Amounts due from group undertakings |
- |
- |
|
|
|
Other debtors |
- |
|
- |
- |
|
Prepayments |
|
|
- |
- |
|
Income tax asset |
- |
|
- |
- |
|
|
|
|
|
Budock Vean Holdings Limited
Notes to the Financial Statements
Year Ended 31 December 2022
Other financial assets |
Group
Financial assets at cost less impairment |
Total |
|
Non-current financial assets |
||
Cost or valuation |
||
At 1 January 2022 |
2,000 |
2,000 |
At 31 December 2022 |
2,000 |
2,000 |
Impairment |
||
Other adjustments |
2,000 |
2,000 |
At 31 December 2022 |
2,000 |
2,000 |
Carrying amount |
||
At 31 December 2022 |
- |
- |
Cash and cash equivalents |
Group |
Company |
|||
2022 |
2021 |
2022 |
2021 |
|
Cash on hand |
|
|
- |
- |
Cash at bank |
|
|
- |
- |
|
|
- |
- |
Budock Vean Holdings Limited
Notes to the Financial Statements
Year Ended 31 December 2022
Creditors |
Group |
Company |
||||
Note |
2022 |
2021 |
2022 |
2021 |
|
Due within one year |
|||||
Loans and borrowings |
|
|
- |
- |
|
Trade creditors |
|
|
- |
- |
|
Social security and other taxes |
|
|
- |
- |
|
Outstanding defined contribution pension costs |
|
|
- |
- |
|
Other creditors |
|
|
|
|
|
Accrued expenses |
|
|
- |
- |
|
Corporation tax |
- |
52,811 |
- |
- |
|
Payments on account |
|
|
- |
- |
|
|
|
|
|
Loans and borrowings |
Group |
Company |
|||
2022 |
2021 |
2022 |
2021 |
|
Current loans and borrowings |
||||
Bank borrowings |
|
|
- |
- |
Finance lease liabilities |
|
|
- |
- |
|
|
- |
- |
Group |
Company |
|||
2022 |
2021 |
2022 |
2021 |
|
Non-current loans and borrowings |
||||
Bank borrowings |
|
|
- |
- |
Redeemable preference shares |
|
|
|
|
Finance lease liabilities |
- |
1,880 |
- |
- |
|
|
|
|
Budock Vean Holdings Limited
Notes to the Financial Statements
Year Ended 31 December 2022
The conditions and security held in respect of the borrowings of the group can be summarised as follows:
Bank borrowings
In January 2019 the group concluded negotiations on a new bank loan facility with its bankers, HSBC. Debts have been consolidated and a single loan of £3.553 million was agreed and drawn. The facility is interest only for the first 24 months which in the short term will preserve cash in the business to enable further investment in the hotel. Interest is accruing at a rate of margin plus LIBOR, where margin is defined as:
• 3% to the third anniversary of the date of the loan agreement;
• 2.5% thereafter provided that appropriate loan to value conditions are met.
The loan is repayable in full at its termination date, which is five years from the date of drawdown.
In July 2020 the group entered into a Coronavirus Business Interruption Loan Agreement with its bankers, HSBC. The facility of £500,000 is subject to capital repayments of £8,333.53 after the first 12 months, with interest accruing at a rate of base plus 3.99%.
The following security is held in respect of the bank loan:
a) Debenture including Fixed Charge over all present freehold and leasehold property; First Fixed Charge over book and other debts, chattels, goodwill and uncalled capital, both present and future; and First Floating Charge over all assets and undertaking both present and future dated 29 January 2019;
b) First Legal Charge dated 22 October 1986 over Freehold Property known as Budock Vean Hotel, Budock Vean Lane, Mawnan Smith, Falmouth, Cornwall;
c) Fixed Charge over book and other debts, goodwill, uncalled capital and intellectual property and a Floating Charge over all other assets dated 11 September 1995;
d) Shares - Memorandum of Deposit dated 29 January 2019;
e) Debenture including Fixed Charge over all present freehold and leasehold property; First Fixed Charge over book and other debts, chattels, goodwill and uncalled capital, both present and future; and First Floating Charge over all assets and undertaking both present and future dated 18 November 2009;
f) Composite Company Unlimited Multilateral Guarantee dated 15 September 2014 given by Budock Vean Hotel Limited, Budock Vean Holdings Limited, Budock Vean Holidays Limited;
g) Composite Company Unlimited Multilateral Guarantee dated 25 May 2011 given by Budock Vean Hotel Limited, Budock Vean Holdings Limited.
Budock Vean Holdings Limited
Notes to the Financial Statements
Year Ended 31 December 2022
Finance lease liabilities
Details pertaining to the finance lease liabilities of the company are disclosed in note 20.
The outstanding balance is secured against the asset to which they relate.
Obligations under leases and hire purchase contracts |
Group
Finance leases
The total of future minimum lease payments is as follows:
2022 |
2021 |
|
Not later than one year |
|
|
Later than one year and not later than five years |
- |
|
|
|
Operating leases
The total of future minimum lease payments is as follows:
2022 |
2021 |
|
- |
- |
The amount of non-cancellable operating lease payments recognised as an expense during the year was £
Budock Vean Holdings Limited
Notes to the Financial Statements
Year Ended 31 December 2022
Reconciliation of net debt |
At 1 January 2022 |
Cash flow |
Other non cash changes |
At 31 December 2022 |
|
£ |
£ |
£ |
£ |
|
Cash at bank and on hand |
1,015,444 |
(606,985) |
- |
408,459 |
Bank overdrafts |
- |
- |
- |
- |
Cash and cash equivalents |
1,015,444 |
(606,985) |
- |
408,459 |
Bank loan less than one year |
(240,000) |
(240,000) |
||
Bank loans more than one year |
(3,631,333) |
205,000 |
(3,426,333) |
|
Preference shares classified as debt |
(1,117,000) |
(645,100) |
- |
(1,762,100) |
Finance leases |
(24,113) |
22,233 |
(1,880) |
|
Net debt |
(3,997,002) |
(1,024,852) |
- |
(5,021,854) |
Deferred tax and other provisions |
Group
Deferred tax |
Total |
|
At 1 January 2022 |
|
|
Increase (decrease) in existing provisions |
( |
( |
At 31 December 2022 |
|
|
|
The composition of the deferred tax balance above is outlined in note 10 to the financial statements.
Pension and other schemes |
Defined contribution pension scheme
The group operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the group to the scheme and amounted to £
Contributions totalling £
Budock Vean Holdings Limited
Notes to the Financial Statements
Year Ended 31 December 2022
Reserves |
Group
The group has certain equity balances which are disclosed in reserves. The derivation of these amounts can be summarised as follows:
Share premium
The share premium account relates to any premium arising on the issue of share capital.
Profit and loss account
The profit and loss account includes all current and prior period retained profits and losses.
Share capital
Called up share capital represents the nominal value of shares that have been issued.
Share capital |
Allotted, called up and fully paid shares
2022 |
2021 |
|||
No. |
£ |
No. |
£ |
|
|
|
59,150 |
|
59,150 |
|
|
5,000 |
|
5,000 |
|
|
|
|
In addition to the equity share capital disclosed above the group has 1,762,100 (2021 - 1,117,000) preference shares at par value. These preference shares are disclosed as liabilities in the financial statements in accordance with their substance applying the principles of FRS102.
Redeemable preference shares
The |
Budock Vean Holdings Limited
Notes to the Financial Statements
Year Ended 31 December 2022
Rights, preferences and restrictions
The Ordinary Shares have the following rights, preferences and restrictions: |
The Deferred Shares have the following rights, preferences and restrictions: |
The Preference Shares have the following rights, preferences and restrictions: |
The redeemable preference shares are classified as liabilities in accordance with UK GAAP.
Budock Vean Holdings Limited
Notes to the Financial Statements
Year Ended 31 December 2022
Related party transactions |
Group
Transactions with the director |
There are no key management personnel outside of the Directors. Details of Directors remuneration is provided within note 7 to the financial statements.
M E Barlow
During the year M E Barlow has had a loan due from the company . This loan is unsecured, interest free and repayable upon demand.
During the year M E Barlow has advanced £nil (2021 - £nil) to the company, and has been repaid £nil (2021 - £nil).
During the year £95,100 has been converted to preference share capital within the parent company, Budock Vean Holdings Limited.
At the balance sheet date M E Barlow was due £nil (2021 - £95,100) from Budock Vean Hotel Limited.
E H Barlow
During the year E H Barlow has had a loan due from the company. This loan is unsecured, interest free and repayable upon demand.
During the year E H Barlow has advanced £nil (2021 - £4,500) to the company, and has been repaid £nil (2021 - £nil).
During the year £150,000 has been converted to preference share capital within the parent company, Budock Vean Holdings Limited.
At the balance sheet date E H Barlow was due £5,988 (2021 - £155,988) from Budock Vean Hotel Limited.
Summary of transactions with subsidiaries
The group companies are all wholly owned by Budock Vean Holdings Limited. On this basis the group has taken advantage of the exemption in FRS102 not to disclose transactions between the group companies.
Parent and ultimate parent undertaking |
The ultimate controlling party is