Company registration number 08444579 (England and Wales)
SPARKLING VENTURES LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
SPARKLING VENTURES LIMITED
COMPANY INFORMATION
Directors
Mr S K Gulhati
Mr S Gulhati
Company number
08444579
Registered office
7-12 Half Moon Street
Mayfair
London
W1J 7BH
Auditor
SPARKLING VENTURES LIMITED
CONTENTS
Page
Directors' report
1
Independent auditor's report
2 - 4
Profit and loss account
5
Balance sheet
6
Statement of changes in equity
7
Notes to the financial statements
8 - 14
SPARKLING VENTURES LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -

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

Principal activities

The principal activity of the company was that of holding investments.

Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

Mr S K Gulhati
Mr S Gulhati
Auditor

The auditor, , is deemed to be reappointed under section 487(2) of the Companies Act 2006.

Statement of directors' responsibilities

The directors are responsible for preparing the annual 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 United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). 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:

 

 

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 enable them to ensure that the financial statements comply with the Companies Act 2006. They 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.

Statement of disclosure to auditor

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.

Small companies exemption

This report has been prepared in accordance with the provisions applicable to companies entitled to the small companies exemption.

On behalf of the board
Mr S K Gulhati
Director
20 August 2024
SPARKLING VENTURES LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF SPARKLING VENTURES LIMITED
- 2 -
Opinion

We have audited the financial statements of Sparkling Ventures Limited (the 'company') for the year ended 31 December 2023 which comprise the profit and loss account, the balance sheet, the statement of changes in equity and notes to the financial statements, including significant accounting policies. The 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:

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 Auditor's 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 UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

 

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

 

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our 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.

Opinions on other matters prescribed by the Companies Act 2006

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

SPARKLING VENTURES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SPARKLING VENTURES LIMITED
- 3 -
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:

 

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, 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.

Auditor's 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 auditor's 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.

The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:

SPARKLING VENTURES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF SPARKLING VENTURES LIMITED
- 4 -

Based on our understanding of the company and industry, and through discussion with the directors and other management, we identified that the principal risks were in relation to:

 

In response to the risk of irregularities, including fraud and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

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 is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's 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 2006. Our 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 auditor's 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.

David Truscott
Senior Statutory Auditor
For and on behalf of
21 August 2024
Chartered Accountants
Statutory Auditors
SPARKLING VENTURES LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 5 -
2023
2022
Notes
£
£
Turnover
-
-
Administrative expenses
(12,282)
(11,916)
Operating loss
(12,282)
(11,916)
Interest receivable and similar income
4
11,764
-
0
Amounts written off investments
(200,741)
(4,168)
Loss before taxation
(201,259)
(16,084)
Tax on loss
49,773
23,357
(Loss)/profit for the financial year
(151,486)
7,273

The profit and loss account has been prepared on the basis that all operations are continuing operations.

SPARKLING VENTURES LIMITED
BALANCE SHEET
AS AT
31 DECEMBER 2023
31 December 2023
- 6 -
2023
2022
Notes
£
£
£
£
Fixed assets
Investments
6
485,904
672,644
Current assets
Debtors
7
100,000
100,000
Cash at bank and in hand
32,495
29,120
132,495
129,120
Creditors: amounts falling due within one year
8
(548,154)
(530,260)
Net current liabilities
(415,659)
(401,140)
Total assets less current liabilities
70,245
271,504
Provisions for liabilities
-
0
(49,773)
Net assets
70,245
221,731
Capital and reserves
Called up share capital
10
100
100
Profit and loss reserves
70,145
221,631
Total equity
70,245
221,731

These financial statements have been prepared 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 20 August 2024 and are signed on its behalf by:
Mr S K Gulhati
Director
Company registration number 08444579 (England and Wales)
SPARKLING VENTURES LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 7 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 January 2022
100
214,358
214,458
Year ended 31 December 2022:
Profit and total comprehensive income
-
7,273
7,273
Balance at 31 December 2022
100
221,631
221,731
Year ended 31 December 2023:
Loss and total comprehensive income
-
(151,486)
(151,486)
Balance at 31 December 2023
100
70,145
70,245
SPARKLING VENTURES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 8 -
1
Accounting policies
Company information

Sparkling Ventures Limited is a private company limited by shares incorporated in England and Wales. The registered office is 7-12 Half Moon Street, Mayfair, London, W1J 7BH.

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, modified to include certain financial instruments at fair value. The principal accounting policies adopted are set out below.

1.2
Going concern

The company had truenet assets of £70,245 (2022: £221,731) and net current liabilities of £415,659 (2022: £401,140). 

 

The company's parent undertaking, Veladail Hotels Limited, has pledged its continuing support to the company. As at the balance sheet date, the company owed its parent £535,854 (2022: £518,854).

 

The directors have carried out a detailed review of the company’s financial position including a review of cash flows and forecasts taking into account recoverability of debts, future investment commitments and the parent company's continuing support. Having taken into account these relevant factors, at the time of approving the financial statements, the directors are of the opinion that the company will continue to be able to meet its financial obligations as they fall due and to continue in operational existence for at least the next twelve months from the date of approval of the accounts.

 

Therefore the directors consider it is appropriate to prepare the financial statements on the going concern basis.

1.3
Fixed asset investments

Fixed asset investments not carried at market value are recognised at amortised cost. Fixed asset investments for which a fair value cannot be measured reliably are valued at cost.

 

If a reliable measure of fair value is no longer available for an asset measured at fair value, its carrying amount at the last date the asset was reliably measurable becomes its new cost. The entity shall measure the asset at this cost amount less impairment, until a reliable measure of fair value becomes available.

1.4
Cash at bank and in hand

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

1.5
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.

SPARKLING VENTURES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 9 -
Basic financial assets

Basic financial assets, which include debtors 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, bank loans, loans from fellow group companies and preference shares that are 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.

 

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

 

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

1.6
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.

Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recognised in profit or loss immediately, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.

1.7
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.

SPARKLING VENTURES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 10 -
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.

1.8
Foreign exchange

Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.

2
Judgements and key sources of estimation uncertainty

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

SPARKLING VENTURES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
2
Judgements and key sources of estimation uncertainty
(Continued)
- 11 -
Key sources of estimation uncertainty

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

Bad debts

As at 31 December 2023, an outstanding debtor of £100,000 (2022: £100,000) was owed to the company. The directors have reviewed the potential recoverability of this debt, including discussions with the relevant party. Having carried out such enquiries, it is the directors’ opinion that the debt is recoverable in full.

Investment fair value measurement

In determining the fair value of investments, the directors are required to exercise professional judgement and employ estimation techniques.

 

The fair value of a fund investment was determined by the directors using a valuation report and the fund’s audited accounts, prepared by the investment fund manager in accordance with International Private Equity and Venture Capital Valuation Guidelines. The fair values of the underlying unlisted investments were determined using valuation techniques such as the price of recent transactions supported by quantitative and qualitative performance analysis, earnings multiples less net debt and industry valuation benchmarks. The fair values of other investments at the year end were determined based on the prices of recent transactions which were used as inputs to the valuation model. Other factors including significant changes to the underlying investments were also considered when they may have a material impact on the fair market value.

 

Notwithstanding the basis of valuations stated above, there are inherent limitations in any valuation technique and the eventual realised proceeds may differ from the year end valuation, especially under volatile economic conditions.

3
Employees

The average monthly number of persons (including directors) employed by the company during the year was:

2023
2022
Number
Number
Total
-
0
-
0
4
Interest receivable and similar income
2023
2022
£
£
Interest receivable and similar income includes the following:
Income from other fixed asset investments
11,764
-
0
SPARKLING VENTURES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
5
Impairments

Impairment tests have been carried out where appropriate and the following impairment losses have been recognised in profit or loss:

2023
2022
Notes
£
£
In respect of:
Fixed asset investments
6
185,661
-
Recognised in:
Amounts written off investments
185,661
-

The impairment losses in respect of financial assets are recognised in other gains and losses in the profit and loss account.

6
Fixed asset investments
2023
2022
£
£
Other investments other than loans
485,904
672,644
Fixed asset investments revalued

Investments presented at fair value of £245,486 (2022: £246,564) and historical cost of £166,576 (2022: £152,575) have been valued by the directors based on the valuation provided by the fund's investment managers and the fund's audited accounts. While observable prices were not available for the investments, the investment managers used valuation techniques to derive their fair value.

 

Investments with a deemed cost of £55,850 (2022: £169,242) and a historical cost of £33,265 (2022: £33,265) have been presented using the price from the last funding round of the relevant entity, less impairment in order to state the carrying value at recoverable amount. An impairment amounting to £113,392 was made during the year.

Financial assets for which fair value cannot be measured reliably

As at 31 December 2023, investments amounting to £184,568 (2022: £256,838) have been valued at amortised cost as the fair value information could not be measured reliably. An impairment amounting to £72,269 has been made against the value of these investments during the year.

SPARKLING VENTURES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
6
Fixed asset investments
(Continued)
- 13 -
Movements in fixed asset investments
Investments
£
Cost or valuation
At 1 January 2023
672,644
Additions
14,001
Valuation changes
(15,080)
Impairment
(185,661)
At 31 December 2023
485,904
Carrying amount
At 31 December 2023
485,904
At 31 December 2022
672,644
7
Debtors
2023
2022
Amounts falling due within one year:
£
£
Other debtors
100,000
100,000

As at 31 December 2023 the company had a specific overdue outstanding debt due to it. The directors have reviewed the potential recoverability of this debt, including a detailed credit analysis and discussions with the relevant party. Having carried out such enquiries, it is the opinion of the directors that the debt is recoverable in full. The total outstanding amount as at 31 December 2023 was £100,000 (2022: £100,000).

 

 

8
Creditors: amounts falling due within one year
2023
2022
£
£
Amounts owed to group undertakings
535,854
518,854
Other creditors
12,300
11,406
548,154
530,260
SPARKLING VENTURES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 14 -
9
Deferred taxation

Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:

Liabilities
Liabilities
2023
2022
Balances:
£
£
Tax losses
(7,718)
(7,718)
Investments
7,718
57,491
-
49,773
2023
Movements in the year:
£
Liability at 1 January 2023
49,773
Credit to profit or loss
(49,773)
Liability at 31 December 2023
-

 

10
Called up share capital
2023
2022
£
£
Ordinary share capital
Issued and fully paid
100 ordinary shares of £1 each
100
100
11
Capital commitments

Amounts contracted for but not provided in the financial statements:

2023
2022
£
£
Acquisition of investments
-
26,675
12
Parent company

The immediate parent company is Veladail Hotels Limited, a company registered in England and Wales. The ultimate holding company is Arrow Trading & Investments Est 1920, a company incorporated in Vaduz.

 

Veladail Hotels Limited prepares group financial statements and copies can be obtained from 7-12 Half Moon Street, London, W1J 7BH.

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