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Registered number: 03783899









VERVE INVESTMENTS LIMITED









DIRECTORS' REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2023

 
VERVE INVESTMENTS LIMITED
 
 
COMPANY INFORMATION


Directors
T E Pain 
R A Nicholson 
J A Watson 




Company secretary
J A Watson



Registered number
03783899



Registered office
10 Blandford Street

London

W1U 4AZ




Independent auditors
Barnes Roffe LLP
Chartered Accountants & Statutory Auditor

Leytonstone House

Leytonstone

London

E11 1GA




Solicitors
Mischon de Reya
Africa House

70 Kingsway

London

WC2B 6AH





 
VERVE INVESTMENTS LIMITED
 

CONTENTS



Page
Directors' report
 
1 - 2
Independent auditors' report
 
3 - 6
Statement of comprehensive income
 
7
Statement of financial position
 
8
Statement of changes in equity
 
9
Notes to the financial statements
 
10 - 22

 
VERVE INVESTMENTS 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.

Directors' responsibilities statement

The directors are responsible for preparing 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;

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.

Results and dividends

The loss for the year, after taxation, amounted to £911,635 (2022 - loss £636,969).

Directors

The directors who served during the year were:

T E Pain 
R A Nicholson 
J A Watson 

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 significant events affecting the Company since the year end.

Page 1

 
VERVE INVESTMENTS LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Auditors

The auditorsBarnes Roffe LLPwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

Small companies note

In preparing this report, the directors have taken advantage of the small companies exemptions provided by section 415A of the Companies Act 2006.

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





T E Pain
Director

Date: 3 June 2024
Page 2

 
VERVE INVESTMENTS LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF VERVE INVESTMENTS LIMITED
 

Opinion


We have audited the financial statements of Verve Investments 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 loss for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


Basis for opinion


We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the 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.


Page 3

 
VERVE INVESTMENTS LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF VERVE INVESTMENTS LIMITED (CONTINUED)


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.


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 Directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the Directors' report has 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 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; or
the directors were not entitled to prepare the financial statements in accordance with the small companies regime and take advantage of the small companies' exemptions in preparing the Directors' report and from the requirement to prepare a Strategic report.


Page 4

 
VERVE INVESTMENTS LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF VERVE INVESTMENTS LIMITED (CONTINUED)


Responsibilities of directors
 

As explained more fully in the Directors' responsibilities statement set out on page 1, 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.


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:

Based on our understanding of the Company and industry, we identified that the principal risks of non-compliance with laws and regulations related to the industry, and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006, income tax, payroll tax and value added tax.
We evaluated management's incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to posting inappropriate journal entries to revenue and management bias in accounting estimates. Audit procedures performed by the engagement team included:
 
Making enquiries of management as to where they considered there was susceptibility to fraud, theirknowledge of actual, suspected and alleged fraud;
Considering the internal controls in place to mitigate risks of fraud and non-compliance with laws andregulations;
Reviewing the financial statements and testing the disclosures against supporting
Performing analytical procedures to identify any unusual or unexpected trends or anomalies;
Inspecting and testing journal entries to identify unusual or unexpected transactions;
Assessing whether judgement and assumptions made in determining significant accounting estimates were
      indicative of management bias.
 
Page 5

 
VERVE INVESTMENTS LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF VERVE INVESTMENTS LIMITED (CONTINUED)




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 members, as a body, 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 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 Company and the Company's members, as a body, for our audit work, for this report, or for the opinions we have formed.





Sooreeyen Iyaroo (Senior statutory auditor)
for and on behalf of
Barnes Roffe LLP
Chartered Accountants
Statutory Auditor
Leytonstone House
Leytonstone
London
E11 1GA


3 June 2024
Page 6

 
VERVE INVESTMENTS LIMITED
 
 
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
Note
£
£

  

Turnover
 4 
690,601
931,376

Cost of sales
  
(266,395)
(278,523)

Gross profit
  
424,206
652,853

Administrative expenses
  
(1,017,879)
(1,392,667)

Net profit on sale of investment properties
  
64,963
89,225

Fair value movements on investment properties
  
158,548
215,225

Operating loss
  
(370,162)
(435,364)

Interest receivable and similar income
 7 
1,241
197

Interest payable and similar charges
 8 
(571,716)
(300,370)

Loss before tax
  
(940,637)
(735,537)

Tax on loss
 9 
29,002
98,568

Loss for the financial year
  
(911,635)
(636,969)

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

The notes on pages 10 to 22 form part of these financial statements.
Page 7

 
VERVE INVESTMENTS LIMITED
REGISTERED NUMBER: 03783899

STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2023

2023
2022
Note
£
£

Fixed assets
  

Investment property
 11 
7,917,501
11,045,000

Current assets
  

Debtors: amounts falling due within one year
 12 
6,158,212
8,258,783

  
6,158,212
8,258,783

Creditors: amounts falling due within one year
 13 
(9,778,268)
(12,065,701)

Net current liabilities
  
 
 
(3,620,056)
 
 
(3,806,918)

Total assets less current liabilities
  
4,297,445
7,238,082

Provisions for liabilities
  

Deferred tax
 14 
(318,165)
(347,167)

Net assets
  
3,979,280
6,890,915


Capital and reserves
  

Called up share capital 
 15 
2
2

Non-distributable reserves
 16 
2,841,470
4,083,302

Retained earnings
 16 
1,137,808
2,807,611

  
3,979,280
6,890,915


The Company's financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.

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




T E Pain
Director

Date: 3 June 2024

The notes on pages 10 to 22 form part of these financial statements.
Page 8

 
VERVE INVESTMENTS LIMITED
 

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


Called up share capital
Non-distributable reserves
Retained earnings
Total equity

£
£
£
£


At 1 January 2022
2
4,096,842
3,431,040
7,527,884


Comprehensive income for the year

Loss for the year
-
-
(636,969)
(636,969)

Surplus on revaluation of investment properties transferred to non-distributable reserve
-
215,225
(215,225)
-

Realised revaluation reserve on disposal of investment properties
-
(325,333)
325,333
-

Movement in deferred tax on revaluation of investment properties recognised in income statement
-
96,568
(96,568)
-



At 1 January 2023
2
4,083,302
2,807,611
6,890,915


Comprehensive income for the year

Loss for the year
-
-
(911,635)
(911,635)

Surplus on revaluation of investment properties transferred to non-distributable reserve
-
158,548
(158,548)
-

Realised revaluation reserve on disposal of investment properties
-
(1,434,051)
1,434,051
-

Movement in deferred tax on revaluation of investment properties recognised in income statement
-
33,671
(33,671)
-


Contributions by and distributions to owners

Dividends: Equity capital
-
-
(2,000,000)
(2,000,000)


At 31 December 2023
2
2,841,470
1,137,808
3,979,280


The notes on pages 10 to 22 form part of these financial statements.
Page 9

 
VERVE INVESTMENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

1.


General information

Verve Investments Limited ("the Company") is a private company limited by shares and incorporated in England and Wales. The Registered Office of the Company is 10 Blandford Street London W1U 4AZ.
The principal activity of the Company is that of rental of investment property.

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

Going concern

The financial statements have been prepared on the going concern basis. The directors consider the going concern basis to be appropriate because the Company's immediate parent company, Verve Group Limited has confirmed that it will provide financial support to the Company to the extent that funds for working capital requirements are not otherwise available for a period of at least 12 months from the date of signing the financial statements. The directors understand that the immediate parent is currently in a strong financial position to continue to support the Company as required.

  
2.3

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 principally comprises income recognised by the company in respect of rent charged and other ancillary services supplied during the year, exclusive of Value Added Tax and trade discounts.
Rental income is recognised on a straight line basis over the term of the lease. Amounts invoiced in advance of a tenancy period are deferred accordingly and recognised as income in the period to which they relate.
Lease premium income is recognised upon receipt in its entirety as this is the point where the Company will no longer have further rights and obligations associated with the lease.

 
2.4

Operating leases: the Company as lessor

Rental income from operating leases is credited to profit or loss on a straight-line basis over the lease term.

Amounts paid and payable as an incentive to sign an operating lease are recognised as a reduction to income over the lease term on a straight-line basis, unless another systematic basis is representative of the time pattern over which the lessor's benefit from the leased asset is diminished.

Page 10

 
VERVE INVESTMENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.5

Interest income

Interest income is recognised in profit or loss using the effective interest method.

 
2.6

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

 
2.7

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.

 
2.8

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.

Page 11

 
VERVE INVESTMENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.9

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:

Fixtures and fittings
-
25%
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.

  
2.10

Investment property

Investment properties, which is property held to earn rentals and/or for capital appreciation, including property under construction for such purposes, is initially are measured initially at cost, including transaction costs. Subsequent to initial recognition, investment properties are stated at fair value, which reflects market conditions at the reporting date. Gains or losses arising from changes in the fair values of investment properties are included in profit or loss in the period in which they arise, including the corresponding tax effect.
Investment properties are internally valued on an annual basis by the Company's directors who are professionally qualified to do so as members of the Royal Institute of Chartered Surveyors (RICS) in the UK.
Fair values are determined based on using a yield methodology. This uses market rental values capitalised at a market capitalisation rate but there is an inevitable degree of judgement involved in that each property is unique and value can only ultimately be reliably tested in the market itself. 
Investment properties are derecognised either when they have been disposed of (i.e. at the date the recipient obtains control) or when they are permanently withdrawn from use and no future economic benefit is expected from their disposal. The difference between the net disposal proceeds and the carrying amount of the asset is recognised in profit or loss in the period of derecognition.

  
2.11

Debtors

Short-term debtors are measured at transaction price, less any impairment.

  
2.12

Creditors

Short-term creditors are measured at the transaction price.

Page 12

 
VERVE INVESTMENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.13

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.

 
2.14

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.

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 13

 
VERVE INVESTMENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)


2.14
Financial instruments (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.

 
2.15

Dividends

Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting.


3.


Judgments in applying accounting policies and key sources of estimation uncertainty

The directors make certain estimates and assumptions regarding the future. Estimates and judgements are continually evaluated based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. In the future, actual experience may differ from these estimates and assumptions. The estimates and assumptions that have significant risk of causing a material adjustment to the carrying amount of assets and liabilities within the next financial year are discussed below.
Significant Judgements
The following are the critical judgements, apart from those involving estimations (which are dealt with separately below), that the directors have made in the process of applying the Company’s accounting policies and that have the most significant effect on the amounts recognised in the financial statements.
Going concern
Significant judgement is required in the Company’s assessment of its use of the going concern basis, and further information on this is included in note 2.2. These include preparing cashflow, and budgets and timing of events held in next accounting period.
Critical accounting estimates
Investment properties
As described in note 11 to the financial statements, investment properties are stated at fair value based on the valuation performed by the directors using the yield methodology. This uses market rental values capitalised at a market capitalisation rate but there is an inevitable degree of judgement involved in that each property is unique and value can only ultimately be reliably tested in the market itself. Key estimated inputs into the valuations are:
- Annual rent per square meter
- Capitalisation rate

Page 14

 
VERVE INVESTMENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

4.


Turnover

An analysis of turnover by class of business is as follows:


2023
2022
£
£

Rent receivable
537,710
735,191

Electricity income
150,856
77,613

Other property income
2,035
118,572


All turnover arose within the United Kingdom.


5.


Auditors' remuneration



Fees payable to the Company’s auditor for the audit of the Company’s annual financial statements are borne by the immediate parent company, Verve Group Limited.





6.


Employees

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


        2023
        2022
            No.
            No.







Operational and administrative
1
1



Directors
3
3

4
4


7.


Interest receivable

2023
2022
£
£


Other interest receivable
1,241
197


8.


Interest payable and similar expenses

2023
2022
£
£


Interest payable to parent undertaking
571,716
300,370

Page 15

 
VERVE INVESTMENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

9.


Taxation


2023
2022
£
£



Total current tax
-
-

Deferred tax


Origination and reversal of timing differences
4,669
(2,000)

Capital gains
(33,671)
(96,568)

Total deferred tax
(29,002)
(98,568)


Taxation on loss on ordinary activities
(29,002)
(98,568)

Factors affecting tax charge for the year

The tax assessed for the year is higher than (2022 - higher than) the standard rate of corporation tax in the UK of 25% (2022 - 19%). The differences are explained below:

2023
2022
£
£


Loss on ordinary activities before tax
(940,637)
(735,537)


Loss on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2022 - 19%)
(235,159)
(139,752)

Effects of:


Non-tax deductible amortisation of goodwill and impairment
58
2,199

Capital allowances for year in excess of depreciation
(63,312)
(102,696)

Utilisation of tax losses
(4,668)
-

Non-taxable income
(55,878)
(16,953)

Chargeable gains / (losses)
156,859
23,220

Movement in deferred tax
(29,002)
(98,568)

Unrelieved taxable losses carried forward
39,179
86,299

Group relief
162,921
147,683

Total tax charge for the year
(29,002)
(98,568)


Factors that may affect future tax charges

The Company has taxable losses of £516,500 available for offset against future taxable profits.

Page 16

 
VERVE INVESTMENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

10.


Tangible fixed assets





Fixtures and fittings

£



Cost or valuation


At 1 January 2023
3,771



At 31 December 2023

3,771



Depreciation


At 1 January 2023
3,771



At 31 December 2023

3,771



Net book value



At 31 December 2023
-



At 31 December 2022
-

Page 17

 
VERVE INVESTMENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

11.


Investment property


Freehold investment property

£



Valuation


At 1 January 2023
11,045,000


Additions at cost
963,953


Disposals
(4,250,000)


Surplus on revaluation
158,548



At 31 December 2023
7,917,501

The 2023 valuations were made by the directors, on an open market value for existing use basis. The 2023 valuations were made by T E Pain, a director of the Company who is professionally qualified and a member of RICS. The significant assumptions made relating to the valuation at 31 December 2023 are given in note 3.





If the Investment properties had been accounted for under the historic cost accounting rules, the properties would have been measured as follows:

2023
2022
£
£


At 1 January
6,229,167
5,956,659

Additions
963,952
651,175

Disposals
(2,815,949)
(378,667)

4,377,170
6,229,167

Page 18

 
VERVE INVESTMENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

12.


Debtors





2023
2022
£
£


Trade debtors
259,915
421,683

Amounts owed by group undertakings
4,310,582
5,607,665

Other debtors
1,561,362
2,218,345

Prepayments and accrued income
26,353
11,090

6,158,212
8,258,783


In 2019, the Company entered into sales and purchase agreement for some of its investment properties for a consideration of £4,332,955 being £2,725,040 cash payment and a non-monetary consideration of £1,607,915 of which £733,215 have been settled in 2023 and it is anticipated £874,701 will be settled in 2024 via the grant of a long leasehold when the property development at the site is completed.


13.


Creditors: Amounts falling due within one year

2023
2022
£
£

Trade creditors
13,547
50,615

Amounts owed to group undertakings
9,003,238
11,003,238

Other taxation and social security
202,801
216,781

Other creditors
379,479
475,950

Accruals and deferred income
179,203
319,117

9,778,268
12,065,701


Included within the amounts owed to group undertakings is a gross amount of £9,000,000 (2022: £11,000,000) relating to a loan that is due to the Company's immediate parent undertaking, Verve Group Limited. The loan is unsecured, bears interest at 0.3% above the external rate paid by Verve Group Limited and is repayable on demand.

Page 19

 
VERVE INVESTMENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

14.


Deferred taxation




2023
2022


£

£






At beginning of year
347,167
445,735


Charged to profit or loss
(29,002)
(98,568)



At end of year
318,165
347,167

The provision for deferred taxation is made up as follows:

2023
2022
£
£


Accelerated capital allowances
(80,765)
(148,220)

Capital gains
488,876
590,001

Losses and other deductions
(89,946)
(94,614)

318,165
347,167


A net reversal of deferred tax assets and liabilities is expected in 2024 by an amount which cannot be readily estimated at the statement of financial position date. This may arise as a result of reversals (or further increases in deferred tax balances) due to the revaluation of investment properties. As the future deferred tax balances, if any, will be dependent on future changes in fair values of assets and liabilties, it is not possible to estimate any future reversals.


15.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



2 (2022 - 2) Ordinary shares of £1.00 each
2
2

The ordinary share carries the right to one vote per share and the rights to share in any distribution of profits on returns of capital.


Page 20

 
VERVE INVESTMENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

16.


Reserves

Non-distributable reserves

This includes the unrealised fair value gains on investment properties which are non-distributable profits.

Retained earnings

This reserve includes all current and prior period retained profits and losses net of dividends paid and other adjustments, which are considered distributable.


17.


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 £1,600 (2022 - £1,565). Contributions totalling £nil (2022: £nil) were payable to the fund at the reporting date and are included in creditors.


18.


Commitments under operating leases - Lessor

The company has entered into leases on its property portfolio, the leases typically have remaining lease terms between 5 months and 999 years and include clauses to enable periodic upward revisions of the rental charge according to prevailing market conditions. Some leases contain option to break before the end of the lease term.
The company has entered into lease where it receives annual ground rent from tenants. The leases typically have remaining lease terms between 247 to 990 years and have the same characteristics as the leases noted above.


At 31 December 2023 the Company had contracted with tenants under non-cancellable operating leases for for the following future minimum lease payments:

2023
2022
£
£


Not later than 1 year
360,306
393,228

Later than 1 year and not later than 5 years
684,833
846,605

Later than 5 years
24,159,464
23,872,045

25,204,603
25,111,878

Page 21

 
VERVE INVESTMENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

19.


Related party transactions

The Company has taken advantage of the exemptions provided by Section 33 of FRS 102 'Related Party Disclosures' and has not disclosed transactions entered into between two or more members of the group provided that any subsidiary undertaking which is party to the transactions is wholly owned by a member of that group.
During the year the Company disposed of investment properties totalling £350,000 to a director and £350,000 to a director's spouse. All sales were arm's length transactions.
Key management personnel
Key management personnel (KMP) are those persons having authority and responsibility for planning, directing and controlling the activities of the Company. Key management personal are considered the directors of the Company. The directors are not remunerated by Company with their remuneration being borne by other members of the group and recharged to the Company.


20.


Controlling party

The Company's immediate parent company is Verve Group Limited, which heads the smallest group for which group accounts containing this company are prepared. The company is domiciled and incorporated in the UK. Copies of the financial statements are available at 10 Blandford Street London W1U 4AZ.
The Company's ultimate controlling party is Valeura Holding Foundation, an entity domiciled in Liechtenstein.
 
Page 22