Company registration number 09586380 (England and Wales)
CLOSE CARE HOMES LIMITED
FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2022
PAGES FOR FILING WITH REGISTRAR
CLOSE CARE HOMES LIMITED
CONTENTS
Page
Balance sheet
1
Notes to the financial statements
2 - 11
CLOSE CARE HOMES LIMITED
BALANCE SHEET
AS AT 30 JUNE 2022
30 June 2022
- 1 -
2022
2021
Notes
£
£
£
£
Fixed assets
Tangible assets
4
6,262
935
Investment properties
5
587,000
592,937
593,262
593,872
Current assets
Stocks
6
350,000
599,000
Debtors
7
9,144
8,159
Cash at bank and in hand
3,171
3,566
362,315
610,725
Creditors: amounts falling due within one year
8
(2,233,197)
(2,417,372)
Net current liabilities
(1,870,882)
(1,806,647)
Total assets less current liabilities
(1,277,620)
(1,212,775)
Provisions for liabilities
(20,849)
(21,984)
Net liabilities
(1,298,469)
(1,234,759)
Capital and reserves
Called up share capital
100
100
Non-distributable profits reserve
66,272
72,209
Distributable profit and loss reserves
(1,364,841)
(1,307,068)
Total equity
(1,298,469)
(1,234,759)
The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true
These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The financial statements were approved by the board of directors and authorised for issue on 28 March 2024 and are signed on its behalf by:
Mr J Y Bailey
Director
Company Registration No. 09586380
CLOSE CARE HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2022
- 2 -
1
Accounting policies
Company information
Close Care Homes Limited is a private company limited by shares incorporated in England and Wales. The registered office is Lime Court, Pathfields Business Park, South Molton, Devon, United Kingdom, EX36 3LH. The company's registered number is 09586380.
The company trades from The Office, The Courthouse, The Marketplace, Somerton, Somerset TA11 7LX.
Close Care Homes Limited is a 80% owned subsidiary of The Stepping Stone Group Limited.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
The financial statements of the company are consolidated in the financial statements of the ultimate parent company, The Stepping Stone Group Limited, which are publicly available. The Stepping Stone Group Limited is a company registered in England and Wales. The company's registered office is Lime Court, Pathfields Business Park, South Molton, Devon, EX36 3LH.
CLOSE CARE HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
1
Accounting policies
(Continued)
- 3 -
1.2
Going concern
At the balance sheet date the company had net liabilitiestrue of £1,298,469 (2021: £1,234,759). In accordance with their responsibilities as directors, the directors have considered the appropriateness of the going concern basis for the preparation of the financial statements. The financial statements have been prepared on the basis that the company is a going concern, and that it will be in a position to continue to trade and to meet its obligations for a period of at least twelve months from the date of the directors approval of these financial statements.
The directors have reviewed the results of the company during the period since the balance sheet date and consider that there have been no additional material post balance sheet events that would have affected the results and financial position at the balance sheet date.
The directors, being suitably knowledgeable and experienced, consider that the company will be able to continue in its operations for a period of at least twelve months from the date of the approval of these financial statements. In arriving at this opinion, the directors have considered the current economic climate, specific conditions affecting the industry and the availability of future loan and bank funding facilities.
The bank loans in place at the balance sheet date have since been extended to April 2024
The current bank loan facility is due to be repaid imminently as part of a consolidation of group finance facilities and the directors do not consider this to impair the company's ability to continue as a going concern. An experienced broker has been used as part of this refinance, with a strong expectation that the refinance shall shortly complete. However, alternative options are also available if the refinance does not proceed as expected.
With the support of the directors, group entities and the continued support of the parent company, The Stepping Stone Group Limited, the directors consider that the going concern basis is appropriate for the preparation of the financial statements. The directors have no reason to believe that this support will not continue and have a reasonable expectation that the company has adequate resources to continue in operational existence for a period of at least twelve months from the date of approval of these financial statements. The Stepping Stone Group Limited has confirmed that it will continue to support the company for at least the next twelve months and repayment of the inter-company loan is not required to be repaid until the company has available funds to do so.
1.3
Reporting period
The financial statements are presented for the period from 30 June 2021 to 30 June 2022.
1.4
Turnover
Turnover is recognised at the fair value of the consideration received or receivable and is shown net of VAT and other sales related taxes.
Sale of property
Revenue from the sale of property is recognised when the significant risks and rewards of ownership of the property have passed to the buyer, usually on legal exchange, and the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the company and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
Rental income
Revenue from rental income is recognised in respect of the rental income accrued.
Interest income
Revenue is recognised as interest accrues using the effective interest rate method.
CLOSE CARE HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
1
Accounting policies
(Continued)
- 4 -
1.5
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Plant and equipment
25% on cost
Fixtures and fittings
25% reducing balance
Computers
33% reducing balance
Motor vehicles
25% reducing balance
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.6
Investment properties
Investment property, which is property held to earn rentals and/or for capital appreciation, is initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Subsequently it is measured at fair value at the reporting end date. Changes in fair value are recognised in profit or loss.
The fair values of the assets are regularly reviewed by the directors and further adjustments to carrying values are made where considered appropriate.
Properties are valued using RICS open market valuation and are supported by independent valuations, where appropriate.
1.7
Borrowing costs
Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale.
All other borrowing costs are recognised in profit or loss in the period in which they are incurred.
1.8
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible 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.
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.
CLOSE CARE HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
1
Accounting policies
(Continued)
- 5 -
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.
1.9
Stocks
Work in progress is stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the work in progress to their present location and condition.
At each reporting date, an assessment is made for impairment, Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognise as an impairment loss in profit or loss. Reversal of impairment losses are also recognised in profit or loss.
1.10
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 loans and overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.11
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Basic financial assets
Basic financial assets, which include all debtors and cash and bank balances, are initially measured at transaction price including transaction costs. Financial assets classified as receivable within one year are not amortised.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including all creditors, bank loans, and loans from fellow group companies, are initially recognised at transaction price Financial liabilities classified as payable within one year are not amortised.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost.
All interest-bearing loans and borrowings which are basic financial instruments are initially recognised at the present value of cash payable to the bank (including interest). After initial recognition they are measured at amortised cost using the effective interest method. The effective interest rate amortisation is included in finance costs in the income statement.
CLOSE CARE HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
1
Accounting policies
(Continued)
- 6 -
1.12
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.13
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
CLOSE CARE HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
1
Accounting policies
(Continued)
- 7 -
1.14
Leases
Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.
1.15
The company has taken advantage of exemption, under the terms of Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland', not to disclose related party transactions with wholly owned subsidiaries within the group.
2
Judgements and key sources of estimation uncertainty
In the application of the company’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.
The judgements and estimates having had the most significant effect on any amounts are as follows:
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.
Work in progress
An apportionment of work in progress is made to cost of sales so that the costs are recognised in line with the respective sales value and total expected sales value for the development.
The carrying value of work in progress is reviewed annually by the directors against the expected selling price less costs to complete and sell. Where any impairment is noted, this is recognised within cost of sales.
Valuation of investment property
Investment properties are reviewed annually for their fair value, where this valuation materially differs to carrying value, adjustments are made to revalue these assets. This movement is recognised in profit or loss.
Independent valuations are obtained from suitably qualified professionals. These are conducted on a periodic basis in order to prevent material misstatement.
The fair value of investment properties was reassessed at 30 June 2022 to be £587,000 (2021: £592,937). Consequently, a loss of £5,937 (2021: £Nil) has been recognised in other comprehensive income.
CLOSE CARE HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
- 8 -
3
Employees
The average monthly number of persons (including directors) employed by the company during the period was:
2022
2021
Number
Number
Total
2
2
Directors remuneration and benefits in kind were £Nil (2021: £Nil)
There were no staff costs for the period ended 30 June 2022 nor 29 June 2021.
4
Tangible fixed assets
Plant and equipment
Fixtures and fittings
Computers
Motor vehicles
Total
£
£
£
£
£
Cost
At 30 June 2021
4,499
660
1,398
6,557
Additions
550
1,257
399
4,183
6,389
At 30 June 2022
5,049
1,917
1,797
4,183
12,946
Depreciation and impairment
At 30 June 2021
4,220
289
1,113
5,622
Depreciation charged in the period
149
250
140
523
1,062
At 30 June 2022
4,369
539
1,253
523
6,684
Carrying amount
At 30 June 2022
680
1,378
544
3,660
6,262
At 29 June 2021
279
371
285
935
Tangible fixed assets are stated at cost or valuation less accumulated depreciation and accumulated impairment losses.
5
Investment property
2022
£
Fair value
At 30 June 2021
592,937
Revaluations
(5,937)
At 30 June 2022
587,000
CLOSE CARE HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
5
Investment property
(Continued)
- 9 -
The fair value of the investment property has been based on the assumptions of the directors of the fair value of investment property based on their rental values at the balance sheet date. The property valuation has been based on an independent valuation carried out by Savills and observable market information. The directors do not consider the fair value of the investment property to be materially misstated.
6
Stocks
2022
2021
£
£
Stocks
350,000
599,000
Work in progress includes capitalised finance costs of £73,156 (2021: £127,515).
7
Debtors
2022
2021
Amounts falling due within one year:
£
£
Trade debtors
5,320
7,133
Corporation tax recoverable
1,026
1,026
Other debtors
2,798
9,144
8,159
8
Creditors: amounts falling due within one year
2022
2021
£
£
Bank loans
841,347
975,985
Trade creditors
18,277
21,052
Amounts owed to group undertakings
1,360,790
1,385,068
Corporation tax
1,026
Other creditors
12,783
34,241
2,233,197
2,417,372
Amounts owed to group undertakings are subject to an annual charge of interest at 4% over base per annum in accordance with inter- group loan agreements. All inter- group loans are repayable on demand and shown within creditors due within one year.
CLOSE CARE HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
- 10 -
9
Loans and overdrafts
2022
2021
£
£
Bank loans
841,347
975,985
Payable within one year
841,347
975,985
The bank loan is secured by fixed and floating charges over all the assets of the company and by a legal mortgage over certain properties in work in progress. The bank loan is repayable by the sales of certain properties held in work in progress, with the loan facility available till 30 November 2023. The facility has since been extended to 30 April 2024.
10
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2022
2021
Balances:
£
£
Accelerated capital allowances
583
234
Revaluations
20,266
21,750
20,849
21,984
2022
Movements in the period:
£
Liability at 30 June 2021
21,984
Credit to profit or loss
(1,135)
Liability at 30 June 2022
20,849
An increase in the main rate of UK Corporation Tax from 19% to 25% from 1 April 2023 was subsequently enacted on 10 June 2021, when Finance Act 2021 received Royal Assent. Although this change is not currently in force, a rate of 25% has been used for purposes of providing for the effects of deferred taxation, on the basis that this rate had been enacted at the Balance sheet date.
11
Audit report information
As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:
The auditor's report was unqualified.
The senior statutory auditor was Claire Clift and the auditor was Azets Audit Services.
CLOSE CARE HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 30 JUNE 2022
- 11 -
12
Financial commitments, guarantees and contingent liabilities
As at 30 June 2022, there were guarantees, contingent liabilities and capital commitments of £Nil (2021; £Nil).
13
Parent company
The company's ultimate parent company is The Stepping Stone Group Limited. The address of the registered office of the parent company and from which copies of the accounts can be obtained is Lime Court, Pathfields Business Park, South Molton, Devon EX36 3LH. The principle place of business of the parent company is Sunindale, Hilliers Lane, Worth, Wells, Somerset BA5 1LP.
The company's ultimate controlling party is Mr J Y Bailey.