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Company registration number: SC674288
Varem Real Estate Limited
Trading as Dungallan House Hotel
Unaudited filleted financial statements
31 December 2023
Varem Real Estate Limited
Contents
Directors and other information
Accountants report
Statement of financial position
Statement of changes in equity
Notes to the financial statements
Varem Real Estate Limited
Directors and other information
Directors Mr Patrik Von Arx
Mr Timo Scherer
Company number SC674288
Registered office 1 Rutland Court
Edinburgh
EH3 8HY
Business address c/o Dungallan House Hotel
Gallanach Road
Oban
PA34 4PD
Accountants Simmers & Co
Albany Chambers
Albany Street
Oban
PA34 4AL
Varem Real Estate Limited
Report to the board of directors on the preparation of the
unaudited statutory financial statements of Varem Real Estate Limited
Year ended 31 December 2023
In order to assist you to fulfil your duties under the Companies Act 2006, we have prepared for your approval the financial statements of Varem Real Estate Limited for the year ended 31 December 2023 which comprise the statement of financial position, statement of changes in equity and related notes from the company's accounting records and from information and explanations you have given us.
As a practising member firm of ICAS , we are subject to its ethical and other professional requirements which are detailed at http://www.icas.com/accountspreparationguidance.
This report is made solely to the board of directors of Varem Real Estate Limited, as a body, in accordance with the terms of our engagement letter dated 19 November 2021. Our work has been undertaken solely to prepare for your approval the financial statements of Varem Real Estate Limited and state those matters that we have agreed to state to the board of directors of Varem Real Estate Limited as a body, in this report in accordance with the requirements of ICAS as detailed at http://www.icas.com/accountspreparationguidance. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than Varem Real Estate Limited and its board of directors as a body for our work or for this report.
It is your duty to ensure that Varem Real Estate Limited has kept adequate accounting records and to prepare statutory financial statements that give a true and fair view of the assets, liabilities, financial position and loss of Varem Real Estate Limited. You consider that Varem Real Estate Limited is exempt from the statutory audit requirement for the year.
We have not been instructed to carry out an audit or a review of the financial statements of Varem Real Estate Limited. For this reason, we have not verified the accuracy or completeness of the accounting records or information and explanations you have given to us and we do not, therefore, express any opinion on the statutory financial statements.
Simmers & Co
Chartered Accoutants
Albany Chambers
Albany Street
Oban
PA34 4AL
7 May 2024
Varem Real Estate Limited
Statement of financial position
31 December 2023
2023 2022
Note £ £ £ £
Fixed assets
Intangible assets 5 70,000 80,000
Tangible assets 6 2,072,041 1,979,016
_______ _______
2,142,041 2,059,016
Current assets
Stocks 21,402 16,913
Debtors 7 1,717 3,619
Cash at bank and in hand 64,931 234,288
_______ _______
88,050 254,820
Creditors: amounts falling due
within one year 8 ( 33,348) ( 19,901)
_______ _______
Net current assets 54,702 234,919
_______ _______
Total assets less current liabilities 2,196,743 2,293,935
Creditors: amounts falling due
after more than one year 9 ( 3,226,611) ( 2,820,818)
_______ _______
Net liabilities ( 1,029,868) ( 526,883)
_______ _______
Capital and reserves
Called up share capital 100 100
Profit and loss account ( 1,029,968) ( 526,983)
_______ _______
Shareholders deficit ( 1,029,868) ( 526,883)
_______ _______
For the year ending 31 December 2023 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.
Directors responsibilities:
- The members have not required the company to obtain an audit of its financial statements for the year in question in accordance with section 476;
- The directors acknowledge their responsibilities for complying with the requirements of the Act with respect to accounting records and the preparation of financial statements.
These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies' regime and in accordance with Section 1A of FRS 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'.
In accordance with section 444 of the Companies Act 2006, the statement of comprehensive income has not been delivered.
These financial statements were approved by the board of directors and authorised for issue on 07 May 2024 , and are signed on behalf of the board by:
Mr Patrik Von Arx Mr Timo Scherer
Director Director
Company registration number: SC674288
Varem Real Estate Limited
Statement of changes in equity
Year ended 31 December 2023
Called up share capital Profit and loss account Total
£ £ £
At 1 January 2022 100 ( 120,593) ( 120,493)
Loss for the year ( 406,390) ( 406,390)
_______ _______ _______
Total comprehensive income for the year - ( 406,390) ( 406,390)
_______ _______ _______
At 31 December 2022 and 1 January 2023 100 ( 526,983) ( 526,883)
Loss for the year ( 502,985) ( 502,985)
_______ _______ _______
Total comprehensive income for the year - ( 502,985) ( 502,985)
_______ _______ _______
At 31 December 2023 100 ( 1,029,968) ( 1,029,868)
_______ _______ _______
Varem Real Estate Limited
Notes to the financial statements
Year ended 31 December 2023
1. General information
The company is a private company limited by shares, registered in Scotland. The address of the registered office is c/o Anderson Strathern, 1 Rutland Court, Edinburgh, EH3 8HY.
2. Statement of compliance
These financial statements have been prepared in compliance with the provisions of FRS 102, Section 1A, 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'.
3. Accounting policies
Basis of preparation
The financial statements have been prepared on the historical cost basis, as modified by the revaluation of certain financial assets and liabilities and investment properties measured at fair value through profit or loss.
The financial statements are prepared in sterling, which is the functional currency of the entity.
Turnover
Turnover is measured at the fair value of the consideration received or receivable for goods supplied and services rendered, net of discounts and Value Added Tax.
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership have transferred to the buyer (usually on despatch of the goods); the amount of revenue can be measured reliably; it is probable that the associated economic benefits will flow to the entity; and the costs incurred or to be incurred in respect of the transactions can be measured reliably.
Taxation
The taxation expense represents the aggregate amount of current and deferred tax recognised in the reporting period. Tax is recognised in the statement of comprehensive income, except to the extent that it relates to items recognised in other comprehensive income or directly in capital and reserves. In this case, tax is recognised in other comprehensive income or directly in capital and reserves, respectively. Current tax is recognised on taxable profit for the current and past periods. Current tax is measured at the amounts of tax expected to pay or recover using the tax rates and laws that have been enacted or substantively enacted at the reporting date.
Deferred tax is recognised in respect of all timing differences at the reporting date. Unrelieved tax losses and other deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date that are expected to apply to the reversal of the timing difference.
Goodwill
Goodwill arises on business acquisitions and represents the excess of the cost of the acquisition over the company's interest in the net amount of the identifiable assets, liabilities and contingent liabilities of the acquired business. Goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. It is amortised on a straight line basis over its useful life. Where a reliable estimate of the useful life of goodwill or intangible assets cannot be made, the life is presumed not to exceed ten years.
Amortisation
Amortisation is calculated so as to write off the cost of an asset, less its estimated residual value, over the useful life of that asset as follows:
Goodwill - 10 % straight line
If there is an indication that there has been a significant change in amortisation rate, useful life or residual value of an intangible asset, the amortisation is revised prospectively to reflect the new estimates.
Tangible assets
tangible assets are initially recorded at cost, and are subsequently stated at cost less any accumulated depreciation and impairment losses. Any tangible assets carried at revalued amounts are recorded at the fair value at the date of revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses. An increase in the carrying amount of an asset as a result of a revaluation, is recognised in other comprehensive income and accumulated in capital and reserves, except to the extent it reverses a revaluation decrease of the same asset previously recognised in profit or loss. A decrease in the carrying amount of an asset as a result of revaluation is recognised in other comprehensive income to the extent of any previously recognised revaluation increase accumulated in capital and reserves in respect of that asset. Where a revaluation decrease exceeds the accumulated revaluation gains accumulated in capital and reserves in respect of that asset, the excess shall be recognised in profit or loss.
Depreciation
Depreciation is calculated so as to write off the cost or valuation of an asset, less its residual value, over the useful economic life of that asset as follows:
Freehold property - 2 % straight line
Fittings fixtures and equipment - 20 % reducing balance
If there is an indication that there has been a significant change in depreciation rate, useful life or residual value of tangible assets, the depreciation is revised prospectively to reflect the new estimates.
Impairment
A review for indicators of impairment is carried out at each reporting date, with the recoverable amount being estimated where such indicators exist. Where the carrying value exceeds the recoverable amount, the asset is impaired accordingly. Prior impairments are also reviewed for possible reversal at each reporting date. When it is not possible to estimate the recoverable amount of an individual asset, an estimate is made of the recoverable amount of the cash-generating unit to which the asset belongs. The cash-generating unit is the smallest identifiable group of assets that includes the asset and generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets. For impairment testing of goodwill, the goodwill acquired in a business combination is, from the acquisition date, allocated to each of the cash-generating units that are expected to benefit from the synergies of the combination, irrespective of whether other assets or liabilities of the company are assigned to those units.
Stocks
Stocks are measured at the lower of cost and estimated selling price less costs to complete and sell. Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing the stocks to their present location and condition.
Financial instruments
A financial asset or a financial liability is recognised only when the company becomes a party to the contractual provisions of the instrument. Basic financial instruments are initially recognised at the transaction price, unless the arrangement constitutes a financing transaction, where it is recognised at the present value of the future payments discounted at a market rate of interest for a similar debt instrument. Debt instruments are subsequently measured at amortised cost. Where investments in non-convertible preference shares and non-puttable ordinary shares or preference shares are publicly traded or their fair value can otherwise be measured reliably, the investment is subsequently measured at fair value with changes in fair value recognised in profit or loss. All other such investments are subsequently measured at cost less impairment. Other financial instruments, including derivatives, are initially recognised at fair value, unless payment for an asset is deferred beyond normal business terms or financed at a rate of interest that is not a market rate, in which case the asset is measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument. Other financial instruments are subsequently measured at fair value, with any changes recognised in profit or loss, with the exception of hedging instruments in a designated hedging relationship.
Financial assets that are measured at cost or amortised cost are reviewed for objective evidence of impairment at the end of each reporting date. If there is objective evidence of impairment, an impairment loss is recognised in profit or loss immediately. For all equity instruments regardless of significance, and other financial assets that are individually significant, these are assessed individually for impairment. Other financial assets or either assessed individually or grouped on the basis of similar credit risk characteristics. Any reversals of impairment are recognised in profit or loss immediately, to the extent that the reversal does not result in a carrying amount of the financial asset that exceeds what the carrying amount would have been had the impairment not previously been recognised.
Defined contribution plans
Contributions to defined contribution plans are recognised as an expense in the period in which the related service is provided. Prepaid contributions are recognised as an asset to the extent that the prepayment will lead to a reduction in future payments or a cash refund. When contributions are not expected to be settled wholly within 12 months of the end of the reporting date in which the employees render the related service, the liability is measured on a discounted present value basis. The unwinding of the discount is recognised in finance costs in profit or loss in the period in which it arises.
4. Staff costs
The average number of persons employed by the company during the year amounted to 7 (2022: 6 ).
The aggregate payroll costs incurred during the year were:
2023 2022
£ £
Wages and salaries 241,857 168,982
Other pension costs 4,805 2,840
_______ _______
246,662 171,822
_______ _______
5. Intangible assets
Goodwill Total
£ £
Cost
At 1 January 2023 and 31 December 2023 100,000 100,000
_______ _______
Amortisation
At 1 January 2023 20,000 20,000
Charge for the year 10,000 10,000
_______ _______
At 31 December 2023 30,000 30,000
_______ _______
Carrying amount
At 31 December 2023 70,000 70,000
_______ _______
At 31 December 2022 80,000 80,000
_______ _______
6. Tangible assets
Freehold property Plant and machinery Fixtures, fittings and equipment Motor vehicles Total
£ £ £ £ £
Cost
At 1 January 2023 1,298,537 350,823 615,705 27,497 2,292,562
Additions - 316,337 44,527 - 360,864
_______ _______ _______ _______ _______
At 31 December 2023 1,298,537 667,160 660,232 27,497 2,653,426
_______ _______ _______ _______ _______
Depreciation
At 1 January 2023 59,062 70,164 177,446 6,874 313,546
Charge for the year 31,650 119,399 111,634 5,156 267,839
_______ _______ _______ _______ _______
At 31 December 2023 90,712 189,563 289,080 12,030 581,385
_______ _______ _______ _______ _______
Carrying amount
At 31 December 2023 1,207,825 477,597 371,152 15,467 2,072,041
_______ _______ _______ _______ _______
At 31 December 2022 1,239,475 280,659 438,259 20,623 1,979,016
_______ _______ _______ _______ _______
7. Debtors
2023 2022
£ £
Other debtors 1,717 3,619
_______ _______
8. Creditors: amounts falling due within one year
2023 2022
£ £
Trade creditors 968 -
Social security and other taxes 19,916 13,810
Other creditors 12,464 6,091
_______ _______
33,348 19,901
_______ _______
9. Creditors: amounts falling due after more than one year
2023 2022
£ £
Other creditors 3,226,611 2,820,818
_______ _______
The company received loans from its holding company Varem Holding AG and Hohle Gasse AG Zentrum which accrue interest at 1% per annum. At 31 December 2023, the total indebtedness was £2,699,574 to the former and £527,037 to the latter. The loans are unsecured and there are no terms set for repayment.
10. Directors advances, credits and guarantees
During the year the directors entered into the following advances and credits with the company:
2023
Balance brought forward Advances /(credits) to the directors Amounts repaid Balance o/standing
£ £ £ £
Mr Patrik Von Arx 2,657 - ( 2,657) -
_______ _______ _______ _______
2022
Balance brought forward Advances /(credits) to the directors Amounts repaid Balance o/standing
£ £ £ £
Mr Patrik Von Arx - 2,657 - 2,657
_______ _______ _______ _______
11. Ultimate Holding Company
The company's share capital is wholly owned by Varem AG Holdings, registered in Switzerland