Company registration number 05047694 (England and Wales)
ARIA ESTATES LIMITED
UNAUDITED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 AUGUST 2023
PAGES FOR FILING WITH REGISTRAR
ARIA ESTATES LIMITED
BALANCE SHEET
AS AT
31 AUGUST 2023
31 August 2023
- 1 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
3
21,193
4,798
Current assets
Debtors
4
765,009
737,811
Cash at bank and in hand
12,517
19,019
777,526
756,830
Creditors: amounts falling due within one year
5
(200,412)
(165,174)
Net current assets
577,114
591,656
Total assets less current liabilities
598,307
596,454
Creditors: amounts falling due after more than one year
6
(134,937)
(142,500)
Provisions for liabilities
Deferred tax liability
4,198
912
(4,198)
(912)
Net assets excluding pension liability
459,172
453,042
Defined benefit pension liability
8
(222,400)
(214,400)
Net assets
236,772
238,642
Capital and reserves
Called up share capital
510
510
Profit and loss reserves
236,262
238,132
Total equity
236,772
238,642
ARIA ESTATES LIMITED
BALANCE SHEET (CONTINUED)
AS AT
31 AUGUST 2023
31 August 2023
- 2 -
The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true
For the financial period ended 31 August 2023 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.
The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.
The members have not required the company to obtain an audit of its financial statements for the period in question in accordance with section 476.
These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The financial statements were approved by the board of directors and authorised for issue on 30 August 2024 and are signed on its behalf by:
Mr S M Byrne
Director
Company Registration No. 05047694
ARIA ESTATES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 AUGUST 2023
- 3 -
1
Accounting policies
Company information
Aria Estates Limited is a private company limited by shares incorporated in England and Wales. The registered office is 13-15 High Street, Witney, Oxfordshire, OX28 6HW.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
1.2
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for property development and building services provided in the normal course of business and is shown net of VAT.
Revenue from contracts for the provision of construction services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to material and subcontract costs, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that are recoverable.
1.3
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Plant and machinery
25% reducing balance
Fixtures, fittings and equipment
25% reducing balance
Computer equipment
25% reducing balance
Motor vehicles
25% reducing balance
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
1.4
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any).
ARIA ESTATES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 AUGUST 2023
1
Accounting policies
(Continued)
- 4 -
1.5
Construction contracts
Where the outcome of a construction contract can be estimated reliably, revenue and costs are recognised by reference to the stage of completion of the contract activity at the reporting end date. Variations in contract work, claims and incentive payments are included to the extent that the amount can be measured reliably and its receipt is considered probable.
When it is probable that total contract costs will exceed total contract turnover, the expected loss is recognised as an expense immediately.
Where the outcome of a construction contract cannot be estimated reliably, contract revenue is recognised to the extent of contract costs incurred where it is probable that they will be recoverable. Contract costs are recognised as expenses in the period in which they are incurred. When costs incurred in securing a contract are recognised as an expense in the period in which they are incurred, they are not included in contract costs if the contract is obtained in a subsequent period.
The “percentage of completion method” is used to determine the appropriate amount to recognise in a given period. The stage of completion is measured by the proportion of contract costs incurred for work performed to date compared to the estimated total contract costs. Costs incurred in the year in connection with future activity on a contract are excluded from contract costs in determining the stage of completion. These costs are presented as stocks, prepayments or other assets depending on their nature, and provided it is probable they will be recovered.
1.6
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
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 debtors, amounts due from connected companies and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method 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. Financial assets classified as receivable within one year are not amortised.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, amounts due to connected companies, bank loans and preference shares classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
ARIA ESTATES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 AUGUST 2023
1
Accounting policies
(Continued)
- 5 -
1.7
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.8
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.9
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
1.10
Retirement benefits
For a defined benefit scheme, the liability recorded in the balance sheet is the present value of the defined obligation at that date. The defined benefit obligation is calculated on an annual basis by independent actuaries.
Actuarial gains and losses are recognised in full in the period in which they occur and are shown in Other Comprehensive Income.
Current and past service costs, along with settlements or curtailments, are charged to the Income Statement. Interest on pension plan liabilities are recognised within finance expenses.
The net interest element is determined by multiplying the net defined benefit liability by the discount rate, taking into account any changes in the net defined benefit liability during the period as a result of contribution and benefit payments. The net interest is recognised in profit or loss as other finance revenue or cost.
Remeasurement changes comprise actuarial gains and losses, the effect of the asset ceiling and the return on the net defined benefit liability excluding amounts included in net interest. These are recognised immediately in other comprehensive income in the period in which they occur and are not reclassified to profit and loss in subsequent periods.
ARIA ESTATES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 AUGUST 2023
1
Accounting policies
(Continued)
- 6 -
The net defined benefit pension asset or liability in the balance sheet comprises the total for each plan of the present value of the defined benefit obligation (using a discount rate based on high quality corporate bonds), less the fair value of plan assets out of which the obligations are to be settled directly. Fair value is based on market price information, and in the case of quoted securities is the published bid price. The value of a net pension benefit asset is limited to the amount that may be recovered either through reduced contributions or agreed refunds from the scheme.
1.11
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.
1.12
Government grants
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.
1.13
The company has created a trust whose beneficiaries will include employees of the company and their dependents. Assets held under this trust will be controlled by trustees who will be acting independently and entirely at their own discretion.
Where assets are held in the trust and these are considered by the company to be in respect of services already provided by employees to the company, the company will account for these as assets of the trust when payment is made to the trust. The value transferred will be charged in the company's profit and loss account for the year to which it relates.
2
Employees
The average monthly number of persons (including directors) employed by the company during the period was:
2023
2022
Number
Number
Total
2
2
ARIA ESTATES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 AUGUST 2023
- 7 -
3
Tangible fixed assets
Plant and machinery etc
£
Cost
At 1 March 2022
19,056
Additions
20,024
At 31 August 2023
39,080
Depreciation and impairment
At 1 March 2022
14,258
Depreciation charged in the period
3,629
At 31 August 2023
17,887
Carrying amount
At 31 August 2023
21,193
At 28 February 2022
4,798
4
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
220
Other debtors
765,009
737,591
765,009
737,811
5
Creditors: amounts falling due within one year
2023
2022
£
£
Bank loans
10,000
10,000
Trade creditors
37,697
69,230
Taxation and social security
40,773
40,002
Other creditors
111,942
45,942
200,412
165,174
As at the year end, £10,000 (2022 - £10,000) included within bank loans is the Bounce Back Loan Scheme which is secured by the UK government.
At the year end, included within other creditors due within one year is an amount owed in respect of an asset held under hire purchase of £3,790 (2022 - £nil), which is secured on the asset concerned.
ARIA ESTATES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 AUGUST 2023
- 8 -
6
Creditors: amounts falling due after more than one year
2023
2022
£
£
Bank loans
17,500
32,500
Other creditors
117,437
110,000
134,937
142,500
As at the year end, £17,500 (2022 - £32,500) included within the bank loans is the Bounce Back Loan Scheme which is secured by the UK Government.
Included within other creditors due after more than one year is an amount owed in respect of an asset held under hire purchase of £7,437 (2022 - £nil), which is secured on the asset concerned.
7
Government grants
The UK Government has undertaken to pay the first year's interest of a Bounce Bank Loan on inception referred to as a Business Interruption Payment (BIP). Last year, the BIP of £167 is recognised as a government grant within other operating income with an equal and corresponding charge included within bank interest. No such amount is recognised in the year to 31 August 2023.
8
Retirement benefit schemes
Defined benefit schemes
The company has agreed to fund a defined benefit pension scheme in respect of key employees. The most recent actuarial valuation of the obligations of £222,400 (2022 - £214,400) was on 31 August 2023. During the year the expense incurred was £5,000 (2022 - £5,000).
2023
2022
Key assumptions
%
%
Discount rate
0.8
0.8
Inflation RPI
8.2
8.2
Inflation CPI
6.2
6.2
Pre and Post Retirement mortality - S2PA tables with improvements in the CMI 2017 model and a long term rate of improvement
1.5
1.5
Mortality assumptions
2023
2022
Assumed life expectations on retirement at age 65:
Years
Years
Retiring in 20 years
- Males
1
1
Amounts recognised in the profit and loss account
2023
2022
Costs/(income):
£
£
Net interest on net defined benefit liability/(asset)
5,000
5,000
ARIA ESTATES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 AUGUST 2023
8
Retirement benefit schemes
(Continued)
- 9 -
Amounts recognised in other comprehensive income
2023
2022
Costs/(income):
£
£
Actuarial changes related to obligations
3,000
3,000
The amounts included in the balance sheet arising from the company's obligations in respect of defined benefit plans are as follows:
2023
2022
Liabilities/(assets):
£
£
Present value of defined benefit obligations
222,400
214,400
Deficit in scheme
222,400
214,400
2023
Movements in the present value of defined benefit obligations
£
Liabilities at 1 March 2022
214,400
Actuarial gains and losses
3,000
Interest cost
5,000
At 31 August 2023
222,400
The defined benefit obligations arise from plans which are wholly unfunded.
Fair value of plan assets at the reporting period end is £nil (2022 - £nil).
Current service cost for the year was £nil (2022 - £nil).
9
Financial commitments, guarantees and contingent liabilities
Aria Estates Limited have received a 'pooling' notice from HM Revenue & Customs (HMRC), in respect of a remuneration plan that was entered into in prior accounting periods. HMRC are disputing the tax treatment of amounts paid under the remuneration plan. On the basis of professional advice given to the company, the directors have been advised that the amounts are not due. It is unclear as to whether or not any tax will be due to HM Revenue & Customs once the dispute is resolved. Due to the uncertainty of the outcome, a provision for this amount has not been recognised in the accounts of Aria Estates Limited.
ARIA ESTATES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE PERIOD ENDED 31 AUGUST 2023
- 10 -
10
Related party transactions
Aria Estates Developments Limited
At the year end, £5,239 (2022 - £8,669) was due to Aria Estates Developments Limited, an associated company owned by two of the directors. No interest is payable on this amount.
Transactions with directors
Last year, Aria Estates Limited incurred costs of £110,481 relating to the construction of a residential property owned by two of the directors. These costs were recharged to the company directors so there is corresponding income of £110,481 in last year's turnover. No mark-up was applied on this recharge. All amounts were settled last year.
Sloping Acre Development Co Ltd
Last year, Aria Estates Limited loaned £663,438 to Sloping Acre Development Co Ltd, a company in which the directors have a participating interest.
At the year end, £691,159 (2022 - £640,367) was due from Sloping Acre Development Co Ltd. No interest is payable on this amount.