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Registered number: 04377912









VERVE DEVELOPMENTS LIMITED









DIRECTORS' REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2023

 
VERVE DEVELOPMENTS LIMITED
 
 
COMPANY INFORMATION


Directors
T E Pain 
R A Nicholson 
J A Watson 




Company secretary
J A Watson



Registered number
04377912



Registered office
30 Blandford Street

London

W1U 4AZ




Independent auditors
Barnes Roffe LLP
Chartered Accountants & Statutory Auditor

Leytonstone House

Leytonstone

London

E11 1GA




Solicitors
Mishcon de Reya
Africa House

70 Kingsway

London

WC2B 6AH





 
VERVE DEVELOPMENTS 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 DEVELOPMENTS 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 profit for the year, after taxation, amounted to £489,558 (2022 - £12,377).

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

Opinion


We have audited the financial statements of Verve Developments 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.


Page 3

 
VERVE DEVELOPMENTS LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF VERVE DEVELOPMENTS 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 DEVELOPMENTS LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF VERVE DEVELOPMENTS 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, their knowledge of actual, suspected and alleged fraud;
Considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations;
Reviewing the financial statements and testing the disclosures against supporting documentation;
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 DEVELOPMENTS LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF VERVE DEVELOPMENTS 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 DEVELOPMENTS LIMITED
 
 
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
Note
£
£

  

Turnover
 4 
1,776,078
1,811,845

Cost of sales
  
(355,291)
(391,910)

Gross profit
  
1,420,787
1,419,935

Administrative expenses
  
(703,531)
(708,186)

Fair value movements
  
139,226
(697,548)

Operating profit
 5 
856,482
14,201

Interest payable and similar charges
 8 
(272,138)
(138,276)

Profit/(loss) before tax
  
584,344
(124,075)

Tax on profit/(loss)
 9 
(94,786)
136,452

Profit for the financial year
  
489,558
12,377

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 DEVELOPMENTS LIMITED
REGISTERED NUMBER: 04377912

STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2023

2023
2022
Note
£
£

Fixed assets
  

Tangible assets
 10 
12,841
17,804

Investment property
 11 
17,850,000
17,500,000

  
17,862,841
17,517,804

Current assets
  

Debtors: amounts falling due within one year
 12 
994,389
1,052,169

Cash at bank and in hand
 13 
1,134,516
1,307,262

  
2,128,905
2,359,431

Creditors: amounts falling due within one year
 14 
(11,814,174)
(12,284,007)

Net current liabilities
  
 
 
(9,685,269)
 
 
(9,924,576)

Total assets less current liabilities
  
8,177,572
7,593,228

Provisions for liabilities
  

Deferred tax
 15 
(1,649,276)
(1,554,490)

Net assets
  
6,528,296
6,038,738


Capital and reserves
  

Called up share capital 
 16 
1
1

Other reserves
 17 
3,518,104
3,435,380

Retained earnings
 17 
3,010,191
2,603,357

  
6,528,296
6,038,738


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: 




J A Watson
Director

Date: 3 June 2024

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

Page 8

 
VERVE DEVELOPMENTS LIMITED
 

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


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

£
£
£
£


At 1 January 2022
1
3,958,541
2,067,819
6,026,361



Profit for the year
-
-
12,377
12,377

Deficit on revaluation of investment properties transferred to non-distributable reserves
-
(697,548)
697,548
-

Movement in deferred tax on revaluation of investment properties recognised in income statement
-
174,387
(174,387)
-



At 1 January 2023
1
3,435,380
2,603,357
6,038,738



Profit for the year
-
-
489,558
489,558

Surplus on revaluation of investment properties transferred to non-distributable reserves
-
139,226
(139,226)
-

Movement in deferred tax on revaluation of investment properties recognised in income statement
-
(56,502)
56,502
-


At 31 December 2023
1
3,518,104
3,010,191
6,528,296


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

Page 9

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

1.


General information

Verve Developments 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 at least a period of 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.

 
2.4

Operating leases: the Company as lessor

Rental income from operating leases is credited to the Statement of comprehensive income 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 DEVELOPMENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.5

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.

 
2.6

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.

 
2.7

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.

Page 11

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

2.Accounting policies (continued)


2.7
Tangible fixed assets (continued)

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 bases:

Plant and machinery
-
25-50% straight line
Fixtures and fittings
-
25% straight line
Office equipment
-
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.

  
2.8

Investment property

Investment properties, which is property held to earn rentals and/or for capital appreciation, including property under construction for such purposes, is 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 comparable sales to owner occupiers and open market lettings using a yield methodology. The latter uses open 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.

  
2.9

Debtors

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

 
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.

Page 12

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

2.Accounting policies (continued)

  
2.11

Creditors

Short-term creditors are measured at the transaction price.

 
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

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

2.Accounting policies (continued)


2.13
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.


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 nest 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 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 forecast, 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 DEVELOPMENTS 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
1,776,078
1,811,845


All turnover arose within the United Kingdom.


5.


Operating profit

The operating profit is stated after charging:

2023
2022
£
£

Defined pension contribution (note 18)
30,748
28,108


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
8,400
-


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





7.


Employees

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


        2023
        2022
            No.
            No.







Property management and administration
23
25

Page 15

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

8.


Interest payable and similar expenses

2023
2022
£
£


Interest payable to the parent undertaking
272,138
138,276


9.


Taxation


2023
2022
£
£

Corporation tax


Adjustments in respect of previous periods
-
(3,565)


Total current tax
-
(3,565)

Deferred tax


Origination and reversal of timing differences
38,284
41,500

Movement of deferred tax on investment properties
56,502
(174,387)

Total deferred tax
94,786
(132,887)


Taxation on profit/(loss) on ordinary activities
94,786
(136,452)
Page 16

 
VERVE DEVELOPMENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
 
9.Taxation (continued)


Factors affecting tax charge for the year

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

2023
2022
£
£


Profit/(loss) on ordinary activities before tax
584,344
(124,075)


Profit/(loss) on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2022 - 19%)
146,086
(23,574)

Effects of:


Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
7,851
143,444

Capital allowances for year in excess of depreciation
(32,389)
(21,166)

Movement in deferred tax provision
94,786
(132,887)

Adjustments to tax charge in respect of prior periods
-
(3,565)

Non-taxable income less expenses not deductible for tax purposes, other than goodwill and impairment
(34,807)
-

Group relief surrendered/(claimed)
(86,741)
(98,704)

Total tax charge for the year
94,786
(136,452)

Page 17

 
VERVE DEVELOPMENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
 
9.Taxation (continued)


Factors that may affect future tax charges

There were no factors that may affect future tax charges.


10.


Tangible fixed assets





Plant and machinery
Fixtures and fittings
Office equipment
Total

£
£
£
£



Cost or valuation


At 1 January 2023
15,148
24,221
6,885
46,254


Additions
-
-
5,250
5,250



At 31 December 2023

15,148
24,221
12,135
51,504



Depreciation


At 1 January 2023
9,214
13,246
5,990
28,450


Charge for the year on owned assets
4,633
4,711
869
10,213



At 31 December 2023

13,847
17,957
6,859
38,663



Net book value



At 31 December 2023
1,301
6,264
5,276
12,841



At 31 December 2022
5,934
10,975
895
17,804

Page 18

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

11.


Investment property


Freehold investment property

£



Valuation


At 1 January 2023
17,500,000


Additions at cost
210,774


Surplus on revaluation
139,226



At 31 December 2023
17,850,000

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 fo 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
13,122,744
13,025,196

Additions
210,774
97,548

13,333,518
13,122,744


12.


Debtors

2023
2022
£
£


Trade debtors
535,535
661,899

Amounts owed by group undertakings
171,920
166,960

Other debtors
225,291
810

Prepayments and accrued income
61,643
222,500

994,389
1,052,169


Page 19

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

13.


Cash and cash equivalents

2023
2022
£
£

Cash at bank and in hand
1,134,516
1,307,262



14.


Creditors: Amounts falling due within one year

2023
2022
£
£

Trade creditors
161,666
196,759

Amounts owed to group undertakings
10,560,685
10,971,094

Other taxation and social security
163,020
182,198

Other creditors
110,592
282,813

Accruals and deferred income
818,211
651,143

11,814,174
12,284,007


At the balance sheet date the Company owed a loan amount of £4,000,000 (2022: £4,000,000) to its immediate parent undertaking, Verve Group Limited. The loan is unsecured, bears interest at LIBOR + 1.55% is repayable on demand. This amount is included within amounts owed to group undertakings.


15.


Deferred taxation




2023
2022


£

£






At beginning of year
1,554,490
1,687,377


Charged/(credited) to profit or loss
94,786
(132,887)



At end of year
1,649,276
1,554,490

The provision for deferred taxation is made up as follows:

2023
2022
£
£


Accelerated capital allowances
672,230
633,946

Capital gains
977,046
920,544

1,649,276
1,554,490

Page 20

 
VERVE DEVELOPMENTS LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
 
15.Deferred taxation (continued)


The Company has no unused tax losses or credits.
A net reversal of deferred tax assets and liabilities is expected in 2024 by an amount which cannot be reliably estimated at the balance sheet date however this is not considered to be material to the financial statements. This is expected to arise because depreciation is anticipated to be higher than the available capital allowances. However, it should be noted that further reversals (or further increases in deferred tax balances) may arise as a result of revaluations of investment property. As the future deferred tax balances, if any, will be dependent on future changes in fair values of assets and liabilities, it is not possible to estimate any further future reversals


16.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



1 (2022 - 1) Ordinary share of £1.00
1
1

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



17.


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.


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 £30,748 (2022: £28,108). Contributions totalling £2,140 (2022: £2,140) were payable to the fund at the balance sheet date and are included in creditors.

Page 21

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

19.


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 also entered into leases where it receives annual ground rent from the tenants. These leases typically have remaining lease terms between 247 to 999 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 the following future minimum lease payments:

2023
2022
£
£


Not later than 1 year
1,530,717
1,440,587

Later than 1 year and not later than 5 years
4,501,959
3,867,906

Later than 5 years
3,892,812
4,537,102

9,925,488
9,845,595


20.


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.
Key management personnel
Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the Group. Key management personal are considered the directors of the Company. The Directors remuneration is borne by another group company.
Other related parties
During the year the Company made purchases of £128,296 (2022: £146,142) relating to construction material from an entity owned and/or controlled by a close family member of key management personnel. At the year end there were outstanding balances owed to the above related party of £1 (2022: £1).


21.


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