Registered number:
FOR THE YEAR ENDED 31 DECEMBER 2022
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CLINITEK PROP LLP
INFORMATION
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CLINITEK PROP LLP
CONTENTS
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CLINITEK PROP LLP
MEMBERS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2022
The members present their annual report together with the audited financial statements of Clinitek Prop LLP (the "LLP") for the year ended 31 December 2022.
Principal activities
The principal activity of the LLP is to hold the land leasehold for a site on which a renewable waste plant is being constructed. The plant is situated in Malvern, Worcestershire. The LLP will charge rent to Clinitek (Malvern) LLP for a period of 25 years to April 2044 for use of the land. The LLP was incorporated on 12 September 2019.
Designated Members
Equitix V Primary Infrastructure (Clinitek Holdings) LP and Equitix V Primary Infrastructure (Clinitek Prop) LP were designated members of the LLP throughout the period.
Members' capital and interests
Each member's subscription to the capital of the LLP is determined by their share of the profit and is repayable following retirement from the LLP.
Details of changes in members' capital in the year ended 31 December 2022 are set out in the financial statements.
Members are remunerated from the profits of the LLP and are required to make their own provision for pensions and other benefits. Profits are allocated and divided between members after finalisation of the financial statements.
Going concern
The LLP had net assets attributable to Members of £1,806,754 at 31 December 2022 (2021: £1,980,959).
As of the date of signing, Clinitek (Malvern) LLP (the tenant) had placed the plant into a state of preservation pending the potential sale of the asset and / or business. Rental charges between the LLP and the tenant had ceased in October 2022 by mutual agreement via joint management. These conditions significantly impact the LLP and as such indicate that a material uncertainty exists that may cast doubt on the LLP’s ability to operate as a going concern. The designated members have received a letter of support from its parent entities which sets out that for the period of 12 months from the signing and approval of the accounts, they will continue to provide any support necessary for the LLP to meet its day to day working capital requirements, however this is on the condition that it continues to hold an interest in the LLP. The designated members have a reasonable expectation that in the event that a sale does not happen, they have the continued support and resources to continue as a going concern for at least 12 months, or until a sale process is completed. Accordingly, the going concern basis has been adopted in the financial statements. In the event that the sale does not go ahead, the members have received a letter of support for 12 months from sign off which commits to providing any support necessary to meet day to day cash flow requirements.
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CLINITEK PROP LLP
MEMBERS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2022
Members' responsibilities statement
The members are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law, (as applied by The Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008), requires the members to prepare financial statements for each financial year. Under that law the members 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, (as applied by The Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008) the members 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 LLP and of the profit or loss of the LLP for that period.
In preparing these financial statements, the members are required to:
∙select suitable accounting policies and then apply them consistently;
∙make judgments and accounting estimates that are reasonable and prudent;
∙prepare the financial statements on the going concern basis unless it is inappropriate to presume that the LLP will continue in business.
The members are responsible for keeping adequate accounting records that are sufficient to show and explain the LLP's transactions and disclose with reasonable accuracy at any time the financial position of the LLP and to enable them to ensure that the financial statements comply with the Companies Act 2006 (as applied by The Limited Liability Partnerships (Accounts and Audit) (Application of the Companies Act 2006) Regulations 2008). They are also responsible for safeguarding the assets of the LLP and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Disclosure of information to auditors
Each of the persons who are members at the time when this Members' report is approved has confirmed that:
∙so far as that member is aware, there is no relevant audit information of which the LLP's auditors are unaware, and
∙that member has taken all the steps that ought to have been taken as a member in order to be aware of any relevant audit information and to establish that the LLP's auditors are aware of that information.
This report was approved by the members on 1 March 2024 and signed on their behalf by:
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CLINITEK PROP LLP
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CLINITEK PROP LLP
We have audited the financial statements of Clinitek Prop LLP (the 'LLP') for the year ended 31 December 2022, which comprise the Statement of comprehensive income, the Balance sheet, the Reconciliation of members' interests and the related notes, 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).
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 Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the LLP in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council'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.
We draw attention to note 2.2 and note 10 in the financial statements, which indicate that the tenant is not paying rent as a result of being placed in a state of preservation pending a potential sale. In February 2024, the members signed heads of terms for the sale of LLP. This is sufficient to indicate that a material uncertainty exists that may cast significant doubt on the LLP's ability to continue as a going concern.
The LLP has received a letter of support from its members and parent shareholders which states they they will continue to support the LLP in the event a sale does not occur, by providing any finance necessary to meet short term working capital requirements. Our opinion is not modified in respect of this matter.
In auditing the financial statements, we have concluded that the members' use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Our evaluation of the members' assessment of the LLP's ability to continue to adopt the going concern basis of accounting included the potential for the sale of the LLP post year end.
Our responsibilities and the responsibilities of the members with respect to going concern are described in the relevant sections of this report.
Except for the matter described in the material uncertainty related to going concern section, we have determined that there are no key audit matters to be communicated in our report.
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CLINITEK PROP LLP
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CLINITEK PROP LLP (CONTINUED)
The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' report thereon. The members are responsible for the other information contained within the Annual Report. Our opinion on the financial statements does not cover the other information and 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.
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CLINITEK PROP LLP
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CLINITEK PROP LLP (CONTINUED)
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 Auditors' 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 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: • the responsible individual ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations; • we identified the laws and regulations applicable to the LLP through discussions with directors and other management, and from our commercial knowledge and experience of the infrastructure sector; • we focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the LLP, including the Companies Act 2006 (as applied by The Limited Liability Partnerships); • we assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence; and • we ensured that the identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit. We assessed the susceptibility of the LLP's financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by: • making enquiries of management as to where they considered there was susceptibility to fraud and their knowledge of actual, suspected and alleged fraud; and • considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations. To address the risk of fraud through management bias and override of controls, we: • performed analytical procedures to identify any unusual or unexpected relationships; • tested journal entries to identify unusual transactions. In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to: • agreeing financial statement disclosures to underlying supporting documentation; • reading the minutes of meetings of those charged with governance; • enquiring of management as to actual and potential litigation and claims; • held discussions with those responsible for all health and safety compliance; and • reviewing correspondence with HMRC, relevant regulators and the LLP's legal expenditure.
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CLINITEK PROP LLP
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CLINITEK PROP LLP (CONTINUED)
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 limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the 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 for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' report.
This report is made solely to the LLP's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006, as applied by Part 12 of The Limited Liability Partnerships (Accounts and Audit) (Applications of Companies Act 2006) Regulations 2008. Our audit work has been undertaken so that we might state to the LLP's members those matters we are required to state to them in an Auditors' 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 LLP and the LLP's members, as a body, for our audit work, for this report, or for the opinions we have formed.
for and on behalf of
Chartered Accountants and Statutory Auditors
32 Portland Terrace
NE2 1QP
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CLINITEK PROP LLP
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2022
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CLINITEK PROP LLP
REGISTERED NUMBER: OC428879
BALANCE SHEET
AS AT 31 DECEMBER 2022
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CLINITEK PROP LLP
REGISTERED NUMBER: OC428879
BALANCE SHEET (CONTINUED)
AS AT 31 DECEMBER 2022
The financial statements were approved and authorised for issue by the members and were signed on their behalf on
The notes on pages 11 to 15 form part of these financial statements.
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RECONCILIATION OF MEMBERS' INTERESTS
FOR THE YEAR ENDED 31 DECEMBER 2022
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CLINITEK PROP LLP
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
Clinitek Prop LLP is a limited liability partnership incorporated in England and Wales. The registered office is 3rd Floor, South Building, 200 Aldersgate Street, London, EC1A 4HD.
2.Accounting policies
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Section 1A of Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006 and the requirements of the Statement of Recommended Practice "Accounting by Limited Liability Partnerships".
The financial statements are prepared in Sterling, which is the functional currency of the Limited Liability Partnership. Monetary amounts in these financial statements are rounded to the nearest £.
The following principal accounting policies have been applied:
The LLP had net assets attributable to Members of £1,806,754 at 31 December 2022 (2021: £1,980,959).
As of the date of signing, Clinitek (Malvern) LLP (the tenant) had placed the plant into a state of preservation pending the potential sale of the asset and / or business. Rental charges between the LLP and the tenant had ceased in October 2022 by mutual agreement via joint management. These conditions significantly impact the LLP and as such indicate that a material uncertainty exists that may cast doubt on the LLP’s ability to operate as a going concern. The designated members have received a letter of support from its parent entities which sets out that for the period of 12 months from the signing and approval of the accounts, they will continue to provide any support necessary for the LLP to meet its day to day working capital requirements, however this is on the condition that it continues to hold an interest in the LLP. The designated members have a reasonable expectation that in the event that a sale does not happen, they have the continued support and resources to continue as a going concern for at least 12 months, or until a sale process is completed. Accordingly, the going concern basis has been adopted in the financial statements. In the event that the sale does not go ahead, the members have received a letter of support for 12 months from sign off which commits to providing any support necessary to meet day to day cash flow requirements.
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CLINITEK PROP LLP
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
A division of profits is the mechanism by which the profits of an LLP become a debt due to members. A division may be automatic or discretionary, may relate to some or all of the profits for a financial period and may take place during or after the end of a financial period.
An automatic division of profits is one where the LLP does not have an unconditional right to avoid making a division of an amount of profits based on the members' agreement in force at the time, whereas a discretionary division of profits requires a decision to be made by the LLP, which it has the unconditional right to avoid making.
The LLP divides profits automatically. Automatic divisions of profits are recognised as 'Members' remuneration charged as an expense in the Statement of comprehensive income.
In the event of the LLP making losses, the loss is recognised as a credit amount of 'Members' remuneration charged as an expense where it is automatically divided or as a debit within equity under 'Other reserves' if not divided automatically.
Tangible fixed assets under the cost model are stated at historical cost less any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
No depreciation has been provided on the freehold as the asset related to land (non depreciable) at the balance sheet date. At each reporting date the LLP assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount. The assets' residual value, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
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CLINITEK PROP LLP
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
2.Accounting policies (continued)
The LLP only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of an out-right short-term loan that is not at market rate, the financial asset or liability is measured, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost. Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the Statement of comprehensive income. For financial assets measured at amortised cost, the impairment loss is measured as the difference between an asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If a financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract. For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount and best estimate of the recoverable amount, which is an approximation of the amount that the LLP would receive for the asset if it were to be sold at the balance sheet date. Financial assets and liabilities are offset and the net amount reported in the Balance sheet when there is an 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. An impairment review of the freehold land (note 5) was considered in the year. Based on the available evidence and in line with section 27 of FRS 102, we confirm that no impairment is required.
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CLINITEK PROP LLP
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
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CLINITEK PROP LLP
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2022
The LLP shall distribute such profits as the Management Board determines in the following order of repayment of the Members of all Capital contributions pro rate to the relevant percentage, and any excess to the members in the relevant percentage.
In the event of winding up the amounts included in "Loans and other debts due to members" will rank equally with unsecured creditors and each member shall be liable to contribute to the assets of the LLP the sum of £10 only.
The immediate parent of the LLP is Equitix V Primary Infrastructure (Clintek Prop) LP, a limited partnership registered in Scotland, UK. Registered address: C/O Cameron Mckenna Nabarro Olswang LLP. Saltire Court, 20 Castle Terrace, Edinburgh, EH1 2EN.
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