Company registration number 13656919 (England and Wales)
ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2023
Faulkner House
Victoria Street
Rayner Essex LLP
St Albans
Chartered Accountants
Hertfordshire
AL1 3SE
ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
COMPANY INFORMATION
Directors
Mrs C A Leavold
Mr A P Todd
Company number
13656919
Registered office
Units 5 & 6
Phoenix House
63 Campfield Road
St Albans
Hertfordshire
AL1 5FL
Auditor
Rayner Essex LLP
Faulkner House
Victoria Street
St Albans
Hertfordshire
AL1 3SE
ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
CONTENTS
Page
Strategic report
1 - 3
Directors' report
4 - 5
Independent auditor's report
6 - 9
Profit and loss account
10
Group statement of comprehensive income
11
Group balance sheet
12
Company balance sheet
13
Group statement of changes in equity
14
Company statement of changes in equity
15
Group statement of cash flows
16
Notes to the financial statements
17 - 35
ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MAY 2023
- 1 -

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

Business review

Abbots Care Holdings’ vision is to be distinguished as a company and employer of choice home care in the UK. Also to be a leader in the field of care delivery by making a difference to our customer’s lives, by providing highly trained care workers, excellent customer service, valuing all those who work for us and placing our customers’ needs at the heart of everything we do. Our goal is to provide outstanding care and support to older people and help people with disabilities live happier, healthier and more fulfilling lives at home. We aim to achieve this by delivering services to both government and privately funded care recipients.

The start of the 2022 -2023 financial year was the first time in 3 years that the business started the year without the fluctuating cycles of Covid and the difficult economic and environmental challenges it brought with it.

Recruitment and retention of Care Workers continued to be a challenge in the sector for the first half of the year and as the recruitment market started to ease in early 2023, our recruitment team saw success in recruiting sufficient numbers of new care workers and operational staff to meet the demand for our services.

Our International Recruitment under our Home Office Sponsorship License continued to be a success with a total head count of 73 new Senior and Care Workers to date having migrated to join the Abbots Care team. This has carried on supporting Abbots Care with the hospital discharge services.

We continue our focus on wellbeing and staff recognition through our Wellbeing app for the care teams, with 65% of employees engaged. This has supported staff retention, which in turn has help further growth.

As always, we continue to maintain a strong commitment to investment in quality and growth. The company has carried on investing heavily into the quality of its services and is accredited to BSI 9001 Total Quality Management standards. Abbots Care also a strong quality management team who are targeted to continually drive quality and continuous improvement throughout the business.

We have seen an overall increase in headcount with new hires to support both the quality and growth teams.

The Home Care market continues to grow with more and more people looking to receive care at home, both government and privately funded, and we continue to have a good pipeline of referrals from both of these sources.

Our outlook is positive and strong, with an expectation of increased growth and profitability in the next year.

ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 2 -
Principal risks and uncertainties

The senior management team led by the managing director maintains a risk register, reviewed regularly by the senior management team. The principal risks identified are: 1. Insufficient workforce to maintain the planned service and well-being of service users; 2. Risk of reputational damage and safeguarding of services users as the group grows and 3. Risk of system failure and cyber attacks.

These risks and mitigated through investment in and growth of the recruitment and retention team and a multi-faceted strategy of engagement, development and support of the workforce. The group uses a robust total quality management system and the quality team monitor compliance and conduct regular audits to ensure high care standards are maintained.

 

Regulatory compliance

The group adheres to the regulations set down by The Care Quality Commission. The most recent full inspection of the Head Office in Herts, the company, by The Care Quality Commission took place during August 2021, and the company achieved an overall rating of 'outstanding'. A further inspection for our Buckingham branch was undertaken in May 2023 and the branch was rated as "good".

The group is certified as compliant in the BSI: 9001:2015 Total Quality Management Certificate and is audited 6 monthly. In the latest report dated March 2023, the company had no non-compliances recorded.

Staffing

The group's staff are key to the services that it can provide its service users. In common with many industries, the company is facing challenges in the labour market, with competition both within the industry and from other industries.

Summary

For most out of financial year 2022-2023, we were able to successfully follow the business plan and forecast to meet the group's KPIs including quality standards, quality, growth and retaining cash reserves within the business.

We aim to use the cash reserves to generate further growth and offer more services to customers in need of support in using the same business model and key objectives in 2023-2024.

Development and performance

 

The key financial highlights for the group are as follows:

Turnover - £16.4m (2022: £11m)

Turnover growth – 48.9% (2022: N/A)

Profit before tax - £3.3m (2022: £4.6m)

Current ratio – 4.7:1 (2022: 4.7:1)

Net assets - £6.6m (2022: £4m)

 

The key non-financial highlights for the group are as follows:

Hours of care (thousands) – 703 (2022: 413)

No. of care workers (average) – 441 (2022: 420)

The group has performed strongly in their principal activities during the year and the directors are pleased with its performance and position.

ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 3 -

On behalf of the board

Mrs C A Leavold
Director
14 February 2024
ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MAY 2023
- 4 -

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

Principal activities

The company is an investment holding company for its subsidiary entities. The principal activity of the group was domiciliary home care providers including mainstream home care, live-in-care, extra care, complex care, and reablement care for local authorities, NHS and privately funded customers.

Results and dividends

The results for the year are set out on page 10.

Ordinary dividends were paid amounting to £208,492. The directors do not recommend payment of a further dividend.

Directors

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

Mrs C A Leavold
Mr A P Todd
Research and development

The group are working with a software developer to develop a bespoke mobile application for staff engagement.

Disabled persons

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

Employee involvement

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

 

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

 

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

The company's employees are at the heart of the service it provides. The group has a policy of continuous improvement and consultation with all stakeholders including all employees. Registered with BSI to BSI:9001 Total Quality Management, the company consults with all its stakeholders. The group has a Business Involvement Group with employee representatives who consult and advise on improvement to all functions within the services provided by the group. All employees are consulted quarterly through employee surveys, and the results are shared in a biannual quality report.

Future developments

The group will continue to expand their operations.

 

The directors continue to review the care sector with a view to continuing growth, identifying opportunities and managing the risks facing the group.

 

Further details of the groups future developments are outlined in the strategic report.

ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 5 -
Auditor

Rayner Essex LLP were appointed as auditor to the group and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.

Statement of directors' responsibilities

The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the group and company, and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

 

 

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the auditor of the company is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the auditor of the company is aware of that information.

Medium-sized companies exemption

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

On behalf of the board
Mrs C A Leavold
Director
14 February 2024
ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
- 6 -
Opinion

We have audited the financial statements of Abbots Care Holdings Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 May 2023 which comprise the group profit and loss account, the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

 

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and parent company’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

 

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

 

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

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

ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
- 7 -
Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

 

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the parent company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
- 8 -
Extent to which the audit was considered capable of detecting irregularities, including fraud

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.

 

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:

We assessed the susceptibility of the limited company's financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

To address the risk of fraud through management bias and override of controls, we;

 

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

 

 

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limited the audit procedures required to identify non-compliance with laws and regulations to enquiry of the members and other management and inspection of regulatory and legal correspondence, if any.

 

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

 

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.

ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
- 9 -

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.

Neil Heyes FCA (Senior Statutory Auditor)
For and on behalf of Rayner Essex LLP
14 February 2024
Chartered Accountants
Statutory Auditor
Faulkner House
Victoria Street
St Albans
Hertfordshire
AL1 3SE
ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
GROUP PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 MAY 2023
- 10 -
Year
Period
ended
ended
31 May
31 May
2023
2022
Notes
£
£
Turnover
3
16,380,563
11,004,718
Cost of sales
(9,935,498)
(7,018,078)
Gross profit
6,445,065
3,986,640
Administrative expenses
(2,446,144)
8,352
Other operating income
228,871
569,912
Exceptional item
4
(908,105)
-
0
Operating profit
5
3,319,687
4,564,904
Interest receivable and similar income
9
26,382
547
Profit before taxation
3,346,069
4,565,451
Tax on profit
10
(570,908)
(340,630)
Profit for the financial year
25
2,775,161
4,224,821
Profit for the financial year is all attributable to the owners of the parent company.
ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MAY 2023
- 11 -
Year
Period
ended
ended
31 May
31 May
2023
2022
£
£
Profit for the year
2,775,161
4,224,821
Other comprehensive income
-
-
Total comprehensive income for the year
2,775,161
4,224,821
Total comprehensive income for the year is all attributable to the owners of the parent company.
ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
GROUP BALANCE SHEET
AS AT
31 MAY 2023
31 May 2023
- 12 -
2023
2022
Notes
£
£
£
£
Fixed assets
Negative goodwill
12
(142,847)
(1,486,810)
Other intangible assets
12
18,836
19,818
Total intangible assets
(124,011)
(1,466,992)
Tangible assets
13
222,532
150,103
Investments
14
899,321
950,000
997,842
(366,889)
Current assets
Debtors
17
4,370,481
2,724,246
Investments
18
1,500,000
1,500,000
Cash at bank and in hand
1,233,226
1,356,617
7,103,707
5,580,863
Creditors: amounts falling due within one year
19
(1,502,312)
(1,180,957)
Net current assets
5,601,395
4,399,906
Total assets less current liabilities
6,599,237
4,033,017
Creditors: amounts falling due after more than one year
20
-
(449)
Net assets
6,599,237
4,032,568
Capital and reserves
Called up share capital
24
32
32
Profit and loss reserves
25
6,599,205
4,032,536
Total equity
6,599,237
4,032,568

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

The financial statements were approved by the board of directors and authorised for issue on 14 February 2024 and are signed on its behalf by:
14 February 2024
Mrs C A Leavold
Director
Company registration number 13656919 (England and Wales)
ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
COMPANY BALANCE SHEET
AS AT 31 MAY 2023
31 May 2023
- 13 -
2023
2022
Notes
£
£
£
£
Fixed assets
Investments
14
32
32
Current assets
Debtors
17
32
32
Creditors: amounts falling due within one year
19
(32)
(32)
Net current assets
-
-
Net assets
32
32
Capital and reserves
Called up share capital
24
32
32

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £208,492 (2022 - £160,581 profit).

The financial statements were approved by the board of directors and authorised for issue on 14 February 2024 and are signed on its behalf by:
14 February 2024
Mrs C A Leavold
Director
Company registration number 13656919 (England and Wales)
ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
GROUP STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MAY 2023
- 14 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 October 2021
-
0
-
0
-
Period ended 31 May 2022:
Profit and total comprehensive income
-
4,224,821
4,224,821
Issue of share capital
24
32
-
32
Dividends
11
-
(192,285)
(192,285)
Balance at 31 May 2022
32
4,032,536
4,032,568
Year ended 31 May 2023:
Profit and total comprehensive income
-
2,775,161
2,775,161
Dividends
11
-
(208,492)
(208,492)
Balance at 31 May 2023
32
6,599,205
6,599,237
ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MAY 2023
- 15 -
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 October 2021
-
0
-
0
-
Period ended 31 May 2022:
Profit and total comprehensive income for the period
-
160,581
160,581
Issue of share capital
24
32
-
32
Dividends
11
-
(160,581)
(160,581)
Balance at 31 May 2022
32
-
0
32
Year ended 31 May 2023:
Profit and total comprehensive income
-
208,492
208,492
Dividends
11
-
(208,492)
(208,492)
Balance at 31 May 2023
32
-
0
32
ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
GROUP STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MAY 2023
- 16 -
2023
2022
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
30
939,171
312,508
Income taxes paid
(546,000)
(86,510)
Net cash inflow from operating activities
393,171
225,998
Investing activities
Purchase of intangible assets
(9,759)
4,005,634
Purchase of tangible fixed assets
(135,432)
(217,391)
Proceeds from disposal of tangible fixed assets
657
(3,674)
Proceeds from disposal of investments
50,679
(2,450,000)
Repayment of loans
(240,148)
(12,657)
Interest received
26,382
547
Net cash (used in)/generated from investing activities
(307,621)
1,322,459
Financing activities
Proceeds from issue of shares
-
(4)
Repayment of bank loans
(449)
449
Dividends paid to equity shareholders
(208,492)
(192,285)
Net cash used in financing activities
(208,941)
(191,840)
Net (decrease)/increase in cash and cash equivalents
(123,391)
1,356,617
Cash and cash equivalents at beginning of year
1,356,617
-
0
Cash and cash equivalents at end of year
1,233,226
1,356,617
ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
NOTES TO THE GROUP FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2023
- 17 -
1
Accounting policies
Company information

Abbots Care Holdings Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Units 5 & 6, Phoenix House, 63 Campfield Road, St Albans, Hertfordshire, AL1 5FL.

 

The group consists of Abbots Care Holdings Limited and all of its subsidiaries.

1.1
Reporting period

The current year reporting period represents the year ended 31 May 2023. The comparative reporting period of the company and its group is the first period of trading represents an eight month period from 1 October 202 1to 31 May 2022. The accounting reference date was shortened to 31 May 2022 to fall in line with the accounting reference dates of the company's subsidiaries.

1.2
Accounting convention

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention, [modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value]. The principal accounting policies adopted are set out below.

The 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 for parent company information presented within the consolidated financial statements:

 

ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
1
Accounting policies
(Continued)
- 18 -
1.3
Business combinations

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

 

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

1.4
Basis of consolidation

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

 

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

 

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

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

Entities in which the group holds an interest and which are jointly controlled by the group and one or more other venturers under a contractual arrangement are treated as joint ventures. Entities other than subsidiary undertakings or joint ventures, in which the group has a participating interest and over whose operating and financial policies the group exercises a significant influence, are treated as associates.

Investments in joint ventures and associates are carried in the group balance sheet at cost plus post-acquisition changes in the group’s share of the net assets of the entity, less any impairment in value. The carrying values of investments in joint ventures and associates include acquired goodwill.

 

If the group’s share of losses in a joint venture or associate equals or exceeds its investment in the joint venture or associate, the group does not recognise further losses unless it has incurred obligations to do so or has made payments on behalf of the joint venture or associate.

 

Unrealised gains arising from transactions with joint ventures and associates are eliminated to the extent of the group’s interest in the entity.

1.5
Going concern

At the time of approving the financial statements, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Thus the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
1
Accounting policies
(Continued)
- 19 -
1.6
Turnover

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

 

Revenue relates to care services provided and is recognised on provision of the services.

 

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

 

1.7
Intangible fixed assets - goodwill

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

 

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.

Negative goodwill is released to the profit & loss account over its expected useful life. Short life assets are recognised in the year of acquisition in full while long life assets are recognised over 3 years.

1.8
Intangible fixed assets other than goodwill

Intangible assets acquired separately from a business are recognised at cost and are subsequently measured at cost less accumulated amortisation and accumulated impairment losses.

 

Intangible assets acquired on business combinations are recognised separately from goodwill at the acquisition date where it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and the fair value of the asset can be measured reliably; the intangible asset arises from contractual or other legal rights; and the intangible asset is separable from the entity.

Amortisation 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:

Mobile application
33% straight line
1.9
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.

ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
1
Accounting policies
(Continued)
- 20 -

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:

Fixtures and fittings
Over 4 years
Computers
Over 3 years
Motor vehicles
Over 4 years

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

1.10
Fixed asset investments

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

 

In the parent company financial statements, investments in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

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

An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.

 

Investments in associates are initially recognised at the transaction price (including transaction costs) and are subsequently adjusted to reflect the group’s share of the profit or loss, other comprehensive income and equity of the associate using the equity method. Any difference between the cost of acquisition and the share of the fair value of the net identifiable assets of the associate on acquisition is recognised as goodwill. Any unamortised balance of goodwill is included in the carrying value of the investment in associates.

 

Losses in excess of the carrying amount of an investment in an associate are recorded as a provision only when the company has incurred legal or constructive obligations or has made payments on behalf of the associate.

 

In the parent company financial statements, investments in associates are accounted for at cost less impairment.

Entities in which the group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

1.11
Impairment of fixed assets

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

 

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

ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
1
Accounting policies
(Continued)
- 21 -

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

 

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

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

1.12
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

1.13
Financial instruments

The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

 

Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.

 

Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets

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

Other financial assets

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

ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
1
Accounting policies
(Continued)
- 22 -
Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Classification of financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.

Basic financial liabilities

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

 

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Other financial liabilities

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

 

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

ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
1
Accounting policies
(Continued)
- 23 -
Derecognition of financial liabilities

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

1.14
Equity instruments

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

1.15
Taxation

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

Current tax

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

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

1.16
Employee benefits

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

 

Termination benefits are recognised immediately as an expense when the group is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.17
Retirement benefits

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

ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
1
Accounting policies
(Continued)
- 24 -
1.18
Leases

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

Temporary rent concessions received as a direct consequence of the Covid-19 pandemic, that meet the following conditions are recognised on a systematic basis over the periods that the change in lease payments is intended to compensate:

 

1.19
Government grants

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

 

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

Government grants comprise amounts received under the Infection Control Fund, Covid Support Claim, Rapid Testing Fund, and under various other covid support schemes including the Coronavirus Job Retention Scheme.

Grant income to be recognised in future periods, includes grants received in relation to capitalised IT equipment which will be recognised in line with the useful life of the equipment.

2
Judgements and key sources of estimation uncertainty

In the application of the group’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

Critical judgements

The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.

Revenue recognition

The percentage completion of services provided by the group is calculated in line with the accounting policy on income recognition, by reference to the costs incurred over the period in which the services are provided.

ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
2
Judgements and key sources of estimation uncertainty
(Continued)
- 25 -
Key sources of estimation uncertainty

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

Trade debtor and accrued sales valuation

Trade debtors and accrued sales are reviewed for indicators of impairment on a line by line basis, and where the estimated recoverable amount is less than the carrying value, an impairment is recognised; and

Other receivables valuation

The recoverability of receivables due from related party debtors, and the requirement for provisions thereon, is based upon an estimate made by management of both the value of the assets held by the undertakings, and its future performance.

3
Turnover and other revenue
2023
2022
£
£
Turnover analysed by class of business
Rendering of services
16,380,563
11,004,718
2023
2022
£
£
Turnover analysed by geographical market
United Kingdom
16,380,563
11,004,718
2023
2022
£
£
Other revenue
Interest income
26,382
547
Grants received
228,871
569,912
4
Exceptional item
2023
2022
£
£
Expenditure
Impairment of assets
908,105
-

The directors have made a provision against a balance in relation to an amount that is no longer considered recoverable from a related party entity following a decision by the related party's management to commence voluntary winding up processes post balance sheet date. The nature of the impairment is considered exceptional to the normal course of trading and therefore has been disclosed in accordance with FRS 102.5.

ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 26 -
5
Operating profit
2023
2022
£
£
Operating profit for the year is stated after charging/(crediting):
Government grants
(228,871)
(569,912)
Depreciation of owned tangible fixed assets
62,612
55,571
(Profit)/loss on disposal of tangible fixed assets
(266)
15,391
Amortisation of intangible assets
10,741
6,438
Release of negative goodwill
(1,343,963)
(2,545,080)
Operating lease charges
188,740
185,591
6
Auditor's remuneration
2023
2022
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the group and company
3,500
3,500
Audit of the financial statements of the company's subsidiaries
22,920
16,700
26,420
20,200
7
Employees

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

Group
Company
2023
2022
2023
2022
Number
Number
Number
Number
Care workers
441
420
-
-
Administration & management
72
69
-
-
Total
513
489
-
0
-
0

Their aggregate remuneration comprised:

Group
Company
2023
2022
2023
2022
£
£
£
£
Wages and salaries
10,618,689
7,133,459
-
0
-
0
Social security costs
951,734
685,317
-
-
Pension costs
227,555
208,222
-
0
-
0
11,797,978
8,026,998
-
0
-
0
ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 27 -
8
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
48,817
20,920
Company pension contributions to defined contribution schemes
3,594
55,300
52,411
76,220
9
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
26,382
547
2023
2022
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
26,382
547
10
Taxation
2023
2022
£
£
Current tax
UK corporation tax on profits for the current period
570,908
340,630

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
3,346,069
4,565,451
Expected tax charge based on the standard rate of corporation tax in the UK of 20.00% (2022: 19.00%)
669,214
867,436
Tax effect of expenses that are not deductible in determining taxable profit
182,080
10,800
Tax effect of income not taxable in determining taxable profit
-
0
(34,457)
Effect of change in corporation tax rate
41
-
Permanent capital allowances in excess of depreciation
(11,635)
(10,100)
Depreciation on assets not qualifying for tax allowances
-
(12,119)
Amortisation on assets not qualifying for tax allowances
(268,792)
(480,930)
Taxation charge
570,908
340,630
ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 28 -
11
Dividends
2023
2022
Recognised as distributions to equity holders:
£
£
Interim paid
208,492
160,581
12
Intangible fixed assets
Group
Negative goodwill
Mobile application
Total
£
£
£
Cost
At 1 June 2022
(4,031,890)
26,256
(4,005,634)
Additions - internally developed
-
0
9,759
9,759
At 31 May 2023
(4,031,890)
36,015
(3,995,875)
Amortisation and impairment
At 1 June 2022
(2,545,080)
6,438
(2,538,642)
Amortisation charged for the year
(1,343,963)
10,741
(1,333,222)
At 31 May 2023
(3,889,043)
17,179
(3,871,864)
Carrying amount
At 31 May 2023
(142,847)
18,836
(124,011)
At 31 May 2022
(1,486,810)
19,818
(1,466,992)
The company had no intangible fixed assets at 31 May 2023 or 31 May 2022.

Negative goodwill represents the assets acquired from its subsidiary undertakings on 4 October 2021 less consideration paid.

 

Other intangible assets were consolidated at amortised cost, which was considered to be fair value.

ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 29 -
13
Tangible fixed assets
Group
Fixtures and fittings
Computers
Motor vehicles
Total
£
£
£
£
Cost
At 1 June 2022
101,311
57,300
31,672
190,283
Additions
-
0
17,854
117,578
135,432
At 31 May 2023
101,311
75,154
149,250
325,715
Depreciation and impairment
At 1 June 2022
(8,932)
43,548
5,564
40,180
Depreciation charged in the year
28,220
13,255
21,137
62,612
Eliminated in respect of disposals
391
-
0
-
0
391
At 31 May 2023
19,679
56,803
26,701
103,183
Carrying amount
At 31 May 2023
81,632
18,351
122,549
222,532
At 31 May 2022
110,243
13,752
26,108
150,103
The company had no tangible fixed assets at 31 May 2023 or 31 May 2022.

When the group was formed tangible fixed assets were consolidated at depreciated replacement cost, which was considered to be fair value.

14
Fixed asset investments
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Investments in subsidiaries
15
-
0
-
0
32
32
Unlisted investments
899,321
950,000
-
0
-
0
899,321
950,000
32
32
ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
14
Fixed asset investments
(Continued)
- 30 -
Movements in fixed asset investments
Group
Investments
£
Cost or valuation
At 1 June 2022
950,000
350,000
(400,679)
At 31 May 2023
899,321
Carrying amount
At 31 May 2023
899,321
At 31 May 2022
950,000
Movements in fixed asset investments
Company
Shares in subsidiaries
£
Cost or valuation
At 1 June 2022 and 31 May 2023
32
Carrying amount
At 31 May 2023
32
At 31 May 2022
32
15
Subsidiaries

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

Name of undertaking
Registered office
Nature of business
Class of
% Held
shares held
Direct
Abbots Care Limited
UK
Care service provider
Ordinary
100.00
Abbots Specialist Care Limited
UK
Care service provider
Ordinary
100.00

All subsidiaries share the same registered office address as the parent company.

The investments in subsidiaries are all stated at cost.

ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 31 -
16
Financial instruments
Group
Company
2023
2022
2023
2022
£
£
£
£
Debt instruments measured at amortised cost
4,234,052
2,638,847
n/a
n/a
Equity instruments measured at cost less impairment
899,321
950,000
n/a
n/a
Instruments measured at fair value through profit or loss
1,500,000
1,500,000
-
-
Carrying amount of financial liabilities
Measured at fair value through profit or loss
Measured at amortised cost
1,210,603
957,364
n/a
n/a

As permitted by the reduced disclosure framework within FRS 102, the company has taken advantage of the exemption from disclosing the carrying amount of certain classes of financial instruments, denoted by 'n/a' above.

 

17
Debtors
Group
Company
2023
2022
2023
2022
Amounts falling due within one year:
£
£
£
£
Trade debtors
1,806,996
1,174,989
-
0
-
0
Unpaid share capital
36
36
32
32
Other debtors
1,465,346
752,041
-
0
-
0
Prepayments and accrued income
1,098,103
797,180
-
0
-
0
4,370,481
2,724,246
32
32
18
Current asset investments
Group
Company
2023
2022
2023
2022
£
£
£
£
Unlisted investments
1,500,000
1,500,000
-
-
ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 32 -
19
Creditors: amounts falling due within one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Trade creditors
65,386
52,836
-
0
-
0
Amounts owed to group undertakings
-
0
-
0
32
32
Corporation tax payable
279,028
254,120
-
0
-
0
Other taxation and social security
12,681
(32,488)
-
-
Deferred income
22
-
0
2,410
-
0
-
0
Other creditors
10,497
952
-
0
-
0
Accruals and deferred income
1,134,720
903,127
-
0
-
0
1,502,312
1,180,957
32
32
20
Creditors: amounts falling due after more than one year
Group
Company
2023
2022
2023
2022
Notes
£
£
£
£
Bank loans and overdrafts
21
-
0
449
-
0
-
0
21
Loans and overdrafts
Group
Company
2023
2022
2023
2022
£
£
£
£
Bank loans
-
0
449
-
0
-
0
Payable after one year
-
0
449
-
0
-
0
22
Deferred income
Group
Company
2023
2022
2023
2022
£
£
£
£
Other deferred income
-
2,410
-
-
23
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
227,555
208,222

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

ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 33 -
24
Share capital
Group and company
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and not fully paid
A Ordinary of £1 each
16
16
16
16
B Ordinary of £1 each
16
16
16
16
32
32
32
32

All classes of Ordinary share capital issued during the period remain unpaid.

25
Profit and loss reserves
Group
Company
2023
2022
2023
2022
£
£
£
£
At the beginning of the year
4,032,536
-
-
-
Profit for the year
2,775,161
4,224,821
208,492
160,581
Dividends
(208,492)
(192,285)
(208,492)
(160,581)
At the end of the year
6,599,205
4,032,536
-
0
-
26
Operating lease commitments
Lessee

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

Group
Company
2023
2022
2023
2022
£
£
£
£
Within one year
162,610
160,180
-
-
Between two and five years
319,815
377,424
-
-
In over five years
92,400
-
-
-
574,825
537,604
-
-
27
Capital commitments

Amounts contracted for but not provided in the financial statements:

Group
Company
2023
2022
2023
2022
£
£
£
£
Acquisition of tangible fixed assets
102,330
97,133
-
-
ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 34 -
28
Related party transactions

During the year, the group entered into the following transactions with related parties:

 

Sales were made to a party subject to common control of £350,189 (2022: £140,115). Expenses have been incurred from a party subject to common control totalled £242,549 (2022: £342,692). In addition, short term, interest free loans have been made to the same party. At the reporting date, a net balance of £1,118,558 (2022: £697,487) was receivable by the group from the party subject to common control.

 

During the period the a subsidiary company granted a joint loan to the directors of the group amounting to £231,148. The loan was provided interest free and with a repayment date of 29 February 2024.

29
Business combinations

On 4 October 2021 the company acquired 100% of the share capital in Abbots Care Limited and Abbots Specialist Care Limited for no consideration. The latter commenced trading on the same date as acquisition.

 

 

Recognised amounts of identified assets acquired and liabilities assumed

Book value

deemed to

be fair value

 

 

Property plant and equipment

121,406

Investments

200,000

Trade and other receivables

1,718,081

Cash and cash equivalents

2,946,072

Trade and other payables

(953,669)

Borrowings

0

Total identifiable net assets

4,031,890

 

 

All the net assets detailed above relate to Abbots Care Limited. As stated above Abbots Specialist Care Limited commenced trading on 4 October 2021 and was previously dormant from it incorporation date.

 

Negative goodwill of £4,031,890 comprises the total identifiable net assets of £4,031,890. Management have estimated the useful life of negative goodwill to be 3 years for long term net assets and has recognised negative goodwill arising from the short life assets immediately.

ABBOTS CARE HOLDINGS LIMITED CONSOLIDATED
NOTES TO THE GROUP FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2023
- 35 -
30
Cash generated from group operations
2023
2022
£
£
Profit for the year after tax
2,775,161
4,224,821
Adjustments for:
Taxation charged
570,908
340,630
Investment income
(26,382)
(547)
(Gain)/loss on disposal of tangible fixed assets
(266)
15,391
Amortisation and impairment of intangible assets
(1,333,222)
(2,538,642)
Depreciation and impairment of tangible fixed assets
62,612
55,571
Movements in working capital:
Increase in debtors
(1,406,087)
(2,711,553)
Increase in creditors
298,857
924,427
(Decrease)/increase in deferred income
(2,410)
2,410
Cash generated from operations
939,171
312,508
31
Analysis of changes in net funds - group
1 June 2022
Cash flows
31 May 2023
£
£
£
Cash at bank and in hand
1,356,617
(123,391)
1,233,226
Borrowings excluding overdrafts
(449)
449
-
1,356,168
(122,942)
1,233,226
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