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Registered number: 09386590
















THE CARY ARMS HOTEL AND SPA LIMITED




ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2023


































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THE CARY ARMS HOTEL AND SPA LIMITED

 
COMPANY INFORMATION


DIRECTORS
L L de Savary 
I Solkin 




COMPANY SECRETARY
J Keefe



REGISTERED NUMBER
09386590



REGISTERED OFFICE
c/o Bishop Fleming LLP
10 Temple Back

Bristol

BS1 6FL




INDEPENDENT AUDITORS
Bishop Fleming Bath Limited
Chartered Accountants & Statutory Auditors

10 Temple Back

Bristol

BS1 6FL




BANKERS
Coutts & Co
440 Strand

London

WC2R 0QS






THE CARY ARMS HOTEL AND SPA LIMITED


CONTENTS



Page
Strategic report
 
1
Directors' report
 
2 - 3
Directors' responsibilities statement
 
4
Independent auditors' report
 
5 - 8
Statement of comprehensive income
 
9
Statement of financial position
 
10
Statement of changes in equity
 
11 - 12
Notes to the financial statements
 
13 - 24



THE CARY ARMS HOTEL AND SPA LIMITED

 
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

BUSINESS REVIEW
 
The principal activity of the company during the year was the operation of a hotel with a leisure complex.
The directors are satisfied with the performance for the year under review. The board has invested and continues to invest in the fabric of the business and are comfortable that the investment is showing positive results and will continue to do so for the foreseeable future.

PRINCIPAL RISKS AND UNCERTAINTIES
 
The management of the business and the execution of the company's strategy are subject to a number of risks.
The key business risks and uncertainties affecting the company are, in common with other hotels in the sector, the general economic activity and perceived health of the economy.
The company's operations also expose it to a number of financial risks including credit risk, liquidity risk and price risk. The directors monitor and manage these risks as follows:
Liquidity risk
In respect of bank balances, the liquidity risk is managed by maintaining the continuity of funding and regular review of monthly management information, including management accounts and cash flow results and forecasts.
Credit risk
Credit risk is managed through policies concerning the credit offered to customers and the regular monitoring of amounts outstanding for both time and credit limits.
Price risk
The price risk is monitored through regular consideration of competitor pricing and occupancy.

FINANCIAL KEY PERFORMANCE INDICATORS
 
Given the straight forward nature of the business, the directors are of the opinion that analysis using KPIs is of limited value. However the directors consider occupancy rate, turnover and gross and operating profit when assessing the performance of the business.


This report was approved by the board and signed on its behalf.



I Solkin
Director

Date: 24 June 2024

Page 1


THE CARY ARMS HOTEL AND SPA LIMITED

 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

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

PRINCIPAL ACTIVITY

The principal activity of the company for the year under review was that of a hotelier. 

RESULTS AND DIVIDENDS

The profit for the year, after taxation, amounted to £118,258 (2022:£401,556).

During the year no dividends were paid (2022: £nil). The directors do not recomment the payment of a final dividend.

DIRECTORS

The directors who served during the year were:

L L de Savary 
I Solkin 

GOING CONCERN

Included within creditors at the year end is a balance of £4,149,658 (2022: £4,287,537) owed to fellow group companies. This balance has no fixed repayment term, however the directors have received confirmation that the repayment of this balance will not be sought for at least a period of 12 months from the date of the approval of these financial statements. 
The Company’s forecasts and projections, taking account of reasonably possible changes in trading performance, show that the Company is able to operate within the level of its current financing. The directors have, therefore, concluded that it is appropriate for the accounts to be prepared on a going concern basis.

FUTURE DEVELOPMENTS

The board has invested and continues to invest in the fabric of the business and are comfortable that the investment will show positive results for the future.

DISCLOSURE OF INFORMATION TO AUDITORS

Each of the persons who are directors at the time when this Directors' Report is approved has confirmed that:
 
so far as the director is aware, there is no relevant audit information of which the Company's auditors are unaware, and

the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditors are aware of that information.

POST BALANCE SHEET EVENTS

There have been no post balance sheet events.

AUDITORS

The auditorsBishop Fleming Bath Limitedwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

Page 2


THE CARY ARMS HOTEL AND SPA LIMITED
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
This report was approved by the board and signed on its behalf.
 






I Solkin
Director

Date: 24 June 2024

c/o Bishop Fleming LLP
10 Temple Back
Bristol
BS1 6FL

Page 3


THE CARY ARMS HOTEL AND SPA LIMITED

 
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023

The directors are responsible for preparing the Strategic Report, the Directors' 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 Company and of the profit or loss of the Company for that period.

 In preparing these financial statements, the directors are required to:

select suitable accounting policies for the Company's financial statements and then apply them consistently;

make judgments and accounting estimates that are reasonable and prudent;

state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.

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

Page 4


THE CARY ARMS HOTEL AND SPA LIMITED

 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THE CARY ARMS HOTEL AND SPA LIMITED
OPINION


We have audited the financial statements of The Cary Arms Hotel and Spa Limited (the 'Company') for the year ended 31 December 2023, which comprise the Statement of Comprehensive Income, the Statement of Financial Position, the Statement of Changes in Equity and the related notes, including a summary of significant accounting policiesThe financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).


In our opinion the financial statements:


give a true and fair view of the state of the Company's affairs as at 31 December 2023 and of its profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


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 Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the 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.


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 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 Auditors' Report thereon. The directors are responsible for the other information contained within the Annual ReportOur 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.


Page 5


THE CARY ARMS HOTEL AND SPA LIMITED
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THE CARY ARMS HOTEL AND SPA LIMITED (CONTINUED)

OPINION ON OTHER MATTERS PRESCRIBED BY THE COMPANIES ACT 2006
 

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


the information given in the Strategic Report and the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the Strategic Report and the Directors' Report have been prepared in accordance with applicable legal requirements.


MATTERS ON WHICH WE ARE REQUIRED TO REPORT BY EXCEPTION
 

In the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the 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:


adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of directors' remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.


RESPONSIBILITIES OF DIRECTORS
 

As explained more fully in the Directors' Responsibilities Statement set out on page 4, 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 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 Company or to cease operations, or have no realistic alternative but to do so.


Page 6


THE CARY ARMS HOTEL AND SPA LIMITED
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THE CARY ARMS HOTEL AND SPA LIMITED (CONTINUED)

AUDITORS' 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 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.


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:

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non compliance with laws and regulations, we considered the following:

We have considered the nature of the industry and sector, control environment, and business performance.
We have considered the results of enquiries with management and the directors in relation to their own identification and assessment of the risks of irregularities within the entity; and
We have reviewed the documentation of key processes and controls and performed walkthroughs of
transactions to confirm that the systems are operating effectively, in line with documentation.
For any matters identified we have obtained and reviewed the Company’s documentation of their policies and procedures relating to:
°Identifying, evaluating and complying with laws and regulations, including Duty, and whether they were aware of any instances of non-compliance;
°Detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud; and
°The internal controls established to mitigate risks of fraud or non-compliance with laws and regulations.
We have considered the matters discussed among the audit engagement team regarding how and where fraud might occur in the financial statements and potential indicators of fraud.
 
As a result of these procedures, we have considered the opportunities and incentives that may exist within the organisation for fraud and identified the highest area of risk to be in relation to revenue recognition, with a particular risk in relation to year-end cut-off.
In common with all audits under ISAs (UK) we are also required to perform specific procedures to respond to the risk of management override.
We have also obtained an understanding of the legal and regulatory frameworks that the Company operates in, focusing on provisions of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included the UK Companies Act, FRS 102 and UK tax legislation.
In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which may be fundamental to the Company’s ability to operate or avoid a material penalty. These included health and safety regulations and employment law.
Our procedures to respond to risks identified included the following:

Reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements;
Enquiring of management in relation to actual and potential claims or litigation;
Performing analytical procedures to identify unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;
Page 7


THE CARY ARMS HOTEL AND SPA LIMITED
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THE CARY ARMS HOTEL AND SPA LIMITED (CONTINUED)

Performing detailed testing in relation to the recognition of revenue with a particular focus around the year-end cut off; and
In addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and other adjustments; assessing whether the judgments made in accounting estimates are indicative of potential bias; and evaluating the business rationale of significant transactions that are unusual or outside the normal course of business.

We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.


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.


USE OF OUR REPORT
 

This report is made solely to the Company's shareholders in accordance with Chapter 3 of Part 16 of the Companies Act 2006Our audit work has been undertaken so that we might state to the Company's directors 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 Company and the Company's shareholders for our audit work, for this report, or for the opinions we have formed.






Richard Newton FCA (Senior statutory auditor)
for and on behalf of
Bishop Fleming Bath Limited
Chartered Accountants
Statutory Auditors
10 Temple Back
Bristol
BS1 6FL

19 July 2024
Page 8


THE CARY ARMS HOTEL AND SPA LIMITED

 
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
Note
£
£

  

Turnover
 4 
2,634,039
2,873,776

Cost of sales
  
(1,536,645)
(1,568,145)

Gross profit
  
1,097,394
1,305,631

Administrative expenses
  
(979,136)
(903,852)

Other operating income
 5 
-
14,001

Operating profit
  
118,258
415,780

Tax on profit
 8 
-
(14,224)

Profit for the financial year
  
118,258
401,556

There was no other comprehensive income for 2023 (2022:£NIL).

The notes on pages 13 to 24 form part of these financial statements.

Page 9


THE CARY ARMS HOTEL AND SPA LIMITED
REGISTERED NUMBER:09386590

STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2023

2023
2022
Note
£
£

Fixed assets
  

Tangible assets
 9 
6,248,250
6,415,580

  
6,248,250
6,415,580

Current assets
  

Stocks
 10 
32,990
26,438

Debtors: amounts falling due within one year
 11 
63,409
59,059

Cash at bank and in hand
 12 
100,742
28,462

  
197,141
113,959

Creditors: amounts falling due within one year
 13 
(4,482,281)
(4,684,687)

Net current liabilities
  
 
 
(4,285,140)
 
 
(4,570,728)

Total assets less current liabilities
  
1,963,110
1,844,852

  

Net assets
  
1,963,110
1,844,852


Capital and reserves
  

Called up share capital 
 15 
100
100

Profit and loss account
 16 
1,963,010
1,844,752

  
1,963,110
1,844,852


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 





I Solkin
Director

Date: 24 June 2024


The notes on pages 13 to 24 form part of these financial statements.

Page 10


THE CARY ARMS HOTEL AND SPA LIMITED


STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023


Called up share capital
Profit and loss account
Total equity

£
£
£

At 1 January 2023
100
1,844,752
1,844,852



Profit for the year
-
118,258
118,258


At 31 December 2023
100
1,963,010
1,963,110


The notes on pages 13 to 24 form part of these financial statements.

Page 11


THE CARY ARMS HOTEL AND SPA LIMITED


STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022


Called up share capital
Profit and loss account
Total equity

£
£
£

At 1 January 2022
100
1,443,196
1,443,296



Profit for the year
-
401,556
401,556


At 31 December 2022
100
1,844,752
1,844,852


The notes on pages 13 to 24 form part of these financial statements.

Page 12


THE CARY ARMS HOTEL AND SPA LIMITED

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

1.


GENERAL INFORMATION

The Cary Arms Hotel and Spa Limited is a limited liability company incorporated in England and Wales. The registered office is 10 Temple Back, Bristol, BS1 6FL.

2.ACCOUNTING POLICIES

 
2.1

BASIS OF PREPARATION OF FINANCIAL STATEMENTS

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies (see note 3).

The following principal accounting policies have been applied:

 
2.2

FINANCIAL REPORTING STANDARD 102 - REDUCED DISCLOSURE EXEMPTIONS

The Company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
the requirements of Section 7 Statement of Cash Flows;
the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
the requirements of Section 11 Financial Instruments paragraphs 11.42, 11.44 to 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);
the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.27, 12.29(a), 12.29(b) and 12.29A;
the requirements of Section 33 Related Party Disclosures paragraph 33.7.

This information is included in the consolidated financial statements of Havana West Limited as at 31 December 2023 and these financial statements may be obtained from Companies House, Crown Way, Maindy, Cardiff, CF14 3UZ.

 
2.3

GOING CONCERN

Included within creditors at the year end is a balance of £4,149,658 (2022: £4,287,537) owed to fellow group companies. This balance has no fixed repayment term, however the directors have received confirmation that the repayment of this balance will not be sought for at least a period of 12 months from the date of the approval of these financial statements. 
The Company’s forecasts and projections, taking account of reasonably possible changes in trading performance, show that the Company is able to operate within the level of its current financing. The directors have, therefore, concluded that it is appropriate for the accounts to be prepared on a going concern basis.

Page 13


THE CARY ARMS HOTEL AND SPA LIMITED

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.ACCOUNTING POLICIES (continued)

 
2.4

REVENUE

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:

Sale of goods

Revenue from the sale of goods is recognised when all of the following conditions are satisfied:
the Company has transferred the significant risks and rewards of ownership to the buyer;
the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
the amount of revenue can be measured reliably;
it is probable that the Company will receive the consideration due under the transaction; and
the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Rendering of services

Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
the amount of revenue can be measured reliably;
it is probable that the Company will receive the consideration due under the contract;
the stage of completion of the contract at the end of the reporting period can be measured reliably; and
the costs incurred and the costs to complete the contract can be measured reliably.

 
2.5

GOVERNMENT GRANTS

Grants are accounted under the accruals model as permitted by FRS 102. Grants relating to expenditure on tangible fixed assets are credited to profit or loss at the same rate as the depreciation on the assets to which the grant relates. The deferred element of grants is included in creditors as deferred income.
Grants of a revenue nature are recognised in the Statement of Comprehensive Income in the same period as the related expenditure.

Page 14


THE CARY ARMS HOTEL AND SPA LIMITED

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.ACCOUNTING POLICIES (continued)

 
2.6

TANGIBLE FIXED ASSETS

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and 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.

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.

Depreciation is provided on the following basis:

Freehold property
-
2%
straight line
Plant and machinery
-
2%
straight line
Motor vehicles
-
20%
straight line
Fixtures and fittings
-
20%
straight line

The assets' residual values, 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.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

 
2.7

STOCKS

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads.

At each reporting date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.

 
2.8

DEBTORS

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
Page 15


THE CARY ARMS HOTEL AND SPA LIMITED

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.ACCOUNTING POLICIES (continued)

  
2.9

FINANCIAL INSTRUMENTS

The Company has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the Company's Statement of Financial Position when the Company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets
Basic financial assets, which include trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.
Discounting is omitted where the effect of discounting is immaterial. The Company's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.
Impairment of financial assets
Financial assets are assessed for indicators of impairment at each reporting date. 
Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.
If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.
Financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instruments any contract that evidences a residual interest in the assets of the Company after the deduction of all its liabilities.
Basic financial liabilities, which include trade and other payables, bank loans and other loans are initially measured at their transaction price after transaction costs. When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. Discounting is omitted where the effect of discounting is immaterial.
Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.


 
Page 16


THE CARY ARMS HOTEL AND SPA LIMITED

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.ACCOUNTING POLICIES (continued)

Trade payables are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade payables are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.
Derecognition of financial instruments
Derecognition of financial assets
Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Company transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Company will continue to recognise the value of the portion of the risks and rewards retained.
Derecognition of financial liabilities
Financial liabilities are derecognised when the Company's contractual obligations expire or are discharged or cancelled.

 
2.10

CASH AND CASH EQUIVALENTS

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

 
2.11

CREDITORS

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

 
2.12

PROVISIONS FOR LIABILITIES

Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
 
Increases in provisions are generally charged as an expense to profit or loss.

 
2.13

PENSIONS

DEFINED CONTRIBUTION PENSION PLAN

The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.

The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of Financial Position. The assets of the plan are held separately from the Company in independently administered funds.

Page 17


THE CARY ARMS HOTEL AND SPA LIMITED

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.ACCOUNTING POLICIES (continued)

 
2.14

CURRENT AND DEFERRED TAXATION

The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company operates and generates income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the reporting date, except that:
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.


3.



JUDGMENTS IN APPLYING ACCOUNTING POLICIES AND KEY SOURCES OF ESTIMATION UNCERTAINTY

Preparation of the financial statements requires management to make significant judgments and estimates. There were no items in these financial statements where material judgments and estimates have been made.
Depreciation
Within each fixed asset class, management allocates an appropriate depreciation rate for each asset based on their assessment of the asaset useful economic life and expected residual value. These vary due to the differing nature of the assets.
 


4.


TURNOVER

2023
2022
£
£

Accomodation
1,474,789
1,705,670

Food and Beverage
1,069,778
1,019,173

Spa
82,633
141,055

Other
6,839
7,878

2,634,039
2,873,776


All turnover arose within the United Kingdom.

Page 18


THE CARY ARMS HOTEL AND SPA LIMITED

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

5.


OTHER OPERATING INCOME

2023
2022
£
£

Government grants receivable
-
14,001

-
14,001



6.


AUDITORS' REMUNERATION

During the year, the Company obtained the following services from the Company's auditors:


2023
2022
£
£

Fees payable to the Company's auditors for the audit of the Company's financial statements

5,500
5,500

The Company has taken advantage of the exemption not to disclose amounts paid for non-audit services as these are disclosed in the consolidated accounts of the parent Company.


7.


EMPLOYEES

Staff costs were as follows:


2023
2022
£
£

Wages and salaries
1,030,495
1,068,885

Social security costs
86,358
93,080

Cost of defined contribution scheme
19,642
20,345

1,136,495
1,182,310


The average monthly number of employees, including the directors, during the year was as follows:


        2023
        2022
            No.
            No.







Office and management staff
2
2



Hotel and housekeeping
46
52

48
54

Page 19


THE CARY ARMS HOTEL AND SPA LIMITED

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

8.


TAXATION


2023
2022
£
£



TOTAL CURRENT TAX
-
-

DEFERRED TAX


Origination and reversal of timing differences
-
13,610

Adjustment in respect of prior periods
-
614

TOTAL DEFERRED TAX
-
14,224


TAX ON PROFIT
-
14,224

FACTORS AFFECTING TAX CHARGE FOR THE YEAR

The tax assessed for the year is lower than (2022:lower than) the standard rate of corporation tax in the UK of 23.52% (2022:19%). The differences are explained below:

2023
2022
£
£


Profit on ordinary activities before tax
118,258
415,780


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 23.52% (2022:19%)
27,815
78,998

EFFECTS OF:


Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
83
64

Fixed asset differences
28,812
24,733

Adjustments to tax charge in respect of prior periods
-
614

Other permanent differences
588
-

Remeasurement of deferred tax for changes in tax rates
3,604
-

Other differences leading to an increase (decrease) in the tax charge
(60,902)
(90,185)

TOTAL TAX CHARGE FOR THE YEAR
-
14,224


FACTORS THAT MAY AFFECT FUTURE TAX CHARGES

There were no factors that may affect future tax charges.

Page 20


THE CARY ARMS HOTEL AND SPA LIMITED

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

9.


TANGIBLE FIXED ASSETS





Freehold property
Plant and machinery
Motor vehicles
Fixtures and fittings
Total

£
£
£
£
£



COST OR VALUATION


At 1 January 2023
6,127,439
875,015
46,934
28,530
7,077,918


Disposals
-
-
(31,858)
-
(31,858)



At 31 December 2023

6,127,439
875,015
15,076
28,530
7,046,060



DEPRECIATION


At 1 January 2023
551,249
78,751
19,033
13,305
662,338


Charge for the year on owned assets
122,499
17,501
5,296
5,574
150,870


Disposals
-
-
(15,398)
-
(15,398)



At 31 December 2023

673,748
96,252
8,931
18,879
797,810



NET BOOK VALUE



At 31 December 2023
5,453,691
778,763
6,145
9,651
6,248,250



At 31 December 2022
5,576,190
796,264
27,901
15,225
6,415,580


10.


STOCKS

2023
2022
£
£

Finished goods and goods for resale
32,990
26,438

32,990
26,438


Page 21


THE CARY ARMS HOTEL AND SPA LIMITED

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

11.


DEBTORS

2023
2022
£
£


Prepayments and accrued income
41,356
37,006

Deferred taxation
22,053
22,053

63,409
59,059



12.


CASH AND CASH EQUIVALENTS

2023
2022
£
£

Cash at bank and in hand
100,742
28,462

100,742
28,462



13.


CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2023
2022
£
£

Trade creditors
94,497
134,656

Amounts owed to group undertakings
4,149,658
4,287,537

Other taxation and social security
70,788
79,214

Other creditors
41,984
20,416

Accruals and deferred income
125,354
162,864

4,482,281
4,684,687


Amounts owed to group undertakings are unsecured, interest free and repayable on demand. The directors have received confirmation that the repayment of the balance will not be sought for the forseeable future.

Page 22


THE CARY ARMS HOTEL AND SPA LIMITED

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

14.


DEFERRED TAXATION




2023


£






At beginning of year
22,053



AT END OF YEAR
22,053

The deferred tax asset is made up as follows:

2023
2022
£
£


Tax losses carried forward
-
125,000

Fixed asset timing differences
22,053
(102,947)

22,053
22,053


15.


SHARE CAPITAL

2023
2022
£
£
ALLOTTED, CALLED UP AND FULLY PAID



100 (2022:100) Ordinary shares of £1.00 each
100
100



16.


RESERVES

Profit and loss account

The profit and loss account includes all current and prior period accumulated profits and losses.


17.


FINANCIAL COMMITMENTS, GUARANTEES AND CONTINGENCIES

The Company has previously granted fixed and floating legal charges over all property or undertaking of the Company in favour of the legal ultimate controlling party. No balance was due at the period end.


18.


PENSION COMMITMENTS

The Company operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Company  in an independently administered fund. The pension cost charge represents contributions payable by the Company  to the fund and amounted to £19,642 (2022: £20,345) . Contributions totalling £nil (2022: £nil) were payable to the fund at the reporting date and are included in creditors.

Page 23


THE CARY ARMS HOTEL AND SPA LIMITED

 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

19.


RELATED PARTY TRANSACTIONS

The company is a wholly owned subsidiary and a part of a group which prepared consolidated financial statements. As a result, it has taken advatange of the exemption under FRS 102 from disclosing intra-group transactions. 
Included within creditors at the year end is a balance of £4,149,054 (2022: £4,287,537) owed to fellow group companies. This balance has no fixed repayment term, however the directors have received confirmation that the repayment of this balance will not be sought for at least a period of 12 months from the date of the approval of these financial statements. 
 


20.


CONTROLLING PARTY

The immediate and ultimate parent company is Havana West Limited, a company incorporated in the United Kingdom.
The Company is a wholly owned subsidiary of Havana West Limited and the results of the Company are
included in the consolidated financial statements of Havana West Limited as at 31 December 2023 which
are available from Companies House.
The legal ultimate controlling party is L L de Savary by virtue of her major legal shareholding in Havana West Limited.

 
Page 24