Company registration number 07971170 (England and Wales)
YPP LETTINGS & MANAGEMENT COMPANY LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
YPP LETTINGS & MANAGEMENT COMPANY LIMITED
COMPANY INFORMATION
Directors
Mr Z Al-Najafi
Mr A M Al-Nejaifi Al-Khaldi
Mr O Al-Najafi
Secretary
Mr Z Al-Najafi
Company number
07971170
Registered office
6 Blenheim Terrace
Leeds
West Yorkshire
LS2 9HZ
Auditor
BDO LLP
Eden Building
Irwell Street
Salford
Manchester
M3 5EN
Business address
6 Blenheim Terrace
Leeds
West Yorkshire
United Kingdom
LS2 9HZ
YPP LETTINGS & MANAGEMENT COMPANY LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Directors' responsibilities statement
4
Independent auditor's report
5 - 8
Statement of comprehensive income
9
Statement of financial position
10
Statement of changes in equity
11
Notes to the financial statements
12 - 22
YPP LETTINGS & MANAGEMENT COMPANY LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 1 -
The directors present the strategic report for the year ended 31 December 2023.
Principal activities
The principal activity of the company continues to be that of residential property management.
Fair review of the business
The start of 2023 letting year was a successful one as the market demand was greater than the supply. During this period, the company successfully hit targets and broke new records. Three new and luxury accommodation buildings opened in Leeds city centre which were the pillars for a new era at YPP guided by its residents and new services provided. At the same time, we underwent an IT overhaul of all our systems in order to provide a better experience for our residents. As the year progressed, we achieved remarkable milestones, a testament to our continued growth and success. The dedication and diligence of our team have contributed to a successful year, demonstrating our commitment to excellence in the lettings industry.
Principal risks and uncertainties
The company continues to face significant risks and uncertainties arising from various factors. Throughout the financial year, interest rate uncertainties by the Bank of England have intensified the cost of living, elevating the risk of a recession and affecting tenant rent payments. Concurrently, increased competition from new projects targeting returning students adds another layer of uncertainty. Management remains vigilant in monitoring these challenges, assessing their potential impact on the business, and has extensively reviewed the situation.
Key performance indicators
The review of turnover and loss margins are the company's key performance indicators. The turnover for the year ended 31st December 2023 was £21,655,609 (2022: £18,101,879). The operating loss margin for the year ended 31st December 2023 was -1.3% (2023: -2%). The directors expect the key performance indicators to improve over the forthcoming years with more properties coming under management. Despite an increase in revenue, our operating profit margin has declined. This decline is primarily due to a significant rise in costs, particularly wages and salaries, as the business expanded considerably in 2023.
The report was approved by the board and signed on its behalf.
Mr Z Al-Najafi
Director
19 September 2024
YPP LETTINGS & MANAGEMENT COMPANY LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
The directors present their annual report and the audited financial statements for the year ended 31 December 2023.
Principal activities
The principal activity of the company continued to be that of residential and commercial properties letting management.
Results and dividends
The results for the year are set out on page 9.
No ordinary dividends were paid during the year (2022: £nil). The directors do not recommend payment of final dividend.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Mr Z Al-Najafi
Mr A M Al-Nejaifi Al-Khaldi
Mr O Al-Najafi
Financial instruments
Liquidity risk
The company manages its cash and borrowing requirements in order to maximise interest income and minimise interest expense, whilst ensuring the group has sufficient liquid resources to meet the operating needs of the business.
Credit risk
Investments of cash surpluses and borrowings are made through banks and companies which must fulfil credit rating criteria approved by the Board.
All customers who wish to trade on credit terms are subject to credit verification procedures. Trade debtors are monitored on an ongoing basis and provision is made for doubtful debts where necessary.
Financial risk management
The company's current policy concerning the payment of trade creditors is to:
settle the terms of payment with suppliers when agreeing the terms of each transaction;
ensure that suppliers are made aware of the terms of payment by inclusion of the relevant terms in contracts; and
pay in accordance with the company's contractual and other legal obligations.
General risks
The events after the year end have encompassed the effects of escalating inflation followed by interest rate hikes by the Bank of England. This scenario has given rise to a tightening of the cost of living and an elevated risk of recession. The surge in inflation has exerted pressure on customers and suppliers, who are already grappling with budget constraints due to cost inflation. Additionally, the construction industry has directly encountered disruptions in the availability and pricing of raw materials and finished goods, potentially causing disturbances throughout 2024. The heightened inflation has also translated into financial strains for tenants, compounding their challenges amidst increased costs. Moreover, the student housing sector has directly felt the impact on the availability and pricing of housing supplies and related services leading to possible disruptions in 2024.
Management maintains a vigilant stance in monitoring these challenges and their repercussions on the business and the Directors have extensively examined these impacts on the business considering the financial market's instability and have concluded that the associated risks are likely to have minimal influence on the company's operations.
YPP LETTINGS & MANAGEMENT COMPANY LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 3 -
Future developments
With the increase in the number of apartments under management through to 2025 we expect to see this reflected in the figures going forward.
Review of going concern
The company made a loss after tax for the year of £73,388 (2022: £287,490) and has net liabilities of £1,046,405 (2022: £973,017). The directors have made an assessment of the company's ability to continue as a going concern for the foreseeable future. The company has obtained a letter of support from the parent company for the provision of financial support however the company has put measures in place where appropriate to reduce the company's expenditure and the directors have also considered the group profit after tax for the year of £3,950,885 (2022: £2,425,366) and net assets of £6,850,817 (2022: £3,853,125). The directors therefore have no doubt over the company's ability to continue as a going concern for the foreseeable future.
The company has undertaken a going concern assessment considering the principal risks and current and projected financial position over the going concern period of 12 months from the date of sign-off. The Directors are therefore able to conclude that they have a reasonable expectation that the company has adequate resources to continue in operational existence and meet its liabilities as they fall due for the next 12 months and have accordingly prepared the financial statements on the going concern basis.
Auditor
The auditor, BDO LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
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.
The report was approved by the board and signed on its behalf.
Mr Z Al-Najafi
Director
19 September 2024
YPP LETTINGS & MANAGEMENT COMPANY LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023
- 4 -
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 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:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and
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 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.
YPP LETTINGS & MANAGEMENT COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF YPP LETTINGS & MANAGEMENT COMPANY LIMITED
- 5 -
Opinion on the financial statements
In our opinion the financial statements:
give a true and fair view of the state of the Company’s affairs as at 31 December 2023 and of its loss for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.
We have audited the financial statements of YPP Lettings & Management Company Limited (“the Company”) for the year ended 31 December 2023 which comprise Statement of comprehensive income, Statement of financial position, Statement of changes in equity and notes to the financial statements, including material accounting policy information. 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).
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 believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Independence
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.
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.
The Directors are responsible for the other information. The other information comprises the information included in the Report of the Board, other than the financial statements and our auditor’s report thereon. 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.
YPP LETTINGS & MANAGEMENT COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF YPP LETTINGS & MANAGEMENT COMPANY LIMITED
- 6 -
Other Companies Act 2006 reporting
In our opinion, based on the work undertaken in the course of our audit:
the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
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 strategic report or 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 remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the Responsibilities of Directors, 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.
Extent to which the audit was capable of detecting irregularities, including fraud
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:
Non-compliance with laws and regulations
Based on:
Our understanding of the Company and the industry in which it operates;
Discussion with management and those charged with governance; and
Obtaining and understanding of the Company’s policies and procedures regarding compliance with laws and regulations.
We considered the significant laws and regulations to be the applicable accounting framework and UK tax legislation.
YPP LETTINGS & MANAGEMENT COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF YPP LETTINGS & MANAGEMENT COMPANY LIMITED
- 7 -
Auditor’s responsibilities for the audit of the financial statements (continued)
The Company is also subject to laws and regulations where the consequence of non-compliance could have a material effect on the amount or disclosures in the financial statements, for example through the imposition of fines or litigations. We identified such laws and regulations to be the health and safety legislation and the data protection act.
Our procedures in respect of the above included:
Review of minutes of meeting of those charged with governance for any instances of non-compliance with laws and regulations;
Review of correspondence with tax authorities for any instances of non-compliance with laws and regulations;
Review of financial statement disclosures and agreeing to supporting documentation;
Involvement of tax specialists in the audit; and
Review of legal expenditure accounts to understand the nature of expenditure incurred.
Fraud
We assessed the susceptibility of the financial statements to material misstatement, including fraud. Our risk assessment procedures included:
Enquiry with management and those charged with governance regarding any known or suspected instances of fraud;
Obtaining an understanding of the Company’s policies and procedures relating to:
Review of minutes of meeting of those charged with governance for any known or suspected instances of fraud;
Discussion amongst the engagement team as to how and where fraud might occur in the financial statements; and
Performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud.
Based on our risk assessment, we considered the areas most susceptible to fraud to be journals and revenue.
Our procedures in respect of the above included:
Testing a sample of journal entries throughout the year, which met a defined risk criteria, by agreeing to supporting documentation;
Assessing significant estimates made by management for bias; and
Procedures to test revenue including agreement of revenue recognised to supporting documentation.
We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members who were all deemed to have appropriate competence and capabilities and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.
Our audit procedures were designed to respond to risks of material misstatement in the financial statements, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery, misrepresentations or through collusion. There are inherent limitations in the audit procedures performed and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we are to become aware of it.
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.
YPP LETTINGS & MANAGEMENT COMPANY LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF YPP LETTINGS & MANAGEMENT COMPANY LIMITED
- 8 -
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.
Hamid Ghafoor (Senior Statutory Auditor)
For and on behalf of BDO LLP, Statutory Auditor
Manchester, UK
Date:
19 September 2024
BDO LLP is a limited liability partnership registered in England and Wales (with registered number OC305127).
YPP LETTINGS & MANAGEMENT COMPANY LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
- 9 -
2023
2022
Notes
£
£
Turnover
3
21,655,609
18,101,879
Cost of sales
(17,767,322)
(14,760,137)
Gross profit
3,888,287
3,341,742
Administrative expenses
(4,164,514)
(3,628,564)
Operating loss
4
(276,227)
(286,822)
Interest receivable and similar income
7
202,839
28
Interest payable and similar expenses
8
(696)
Loss before taxation
(73,388)
(287,490)
Tax on loss
9
Loss for the financial year
(73,388)
(287,490)
The income statement has been prepared on the basis that all operations are continuing operations.
The notes on pages 12 to 22 form part of these financial statements.
YPP LETTINGS & MANAGEMENT COMPANY LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT
31 DECEMBER 2023
31 December 2023
- 10 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
10
11,468
3,610
Current assets
Debtors falling due after more than one year
11
300,000
Debtors falling due within one year
11
6,127,122
2,526,584
Cash at banks and in hand
12
7,673,868
5,307,815
14,100,990
7,834,399
Creditors: amounts falling due within one year
13
(15,158,863)
(8,811,026)
Net current liabilities
(1,057,873)
(976,627)
Net liabilities
(1,046,405)
(973,017)
Capital and reserves
Called up share capital
16
1,000
1,000
Profit and loss reserves
(1,047,405)
(974,017)
Total equity
(1,046,405)
(973,017)
The notes on pages 12 to 22 form part of these financial statements.
The financial statements were approved by the board of directors and authorised for issue on 19 September 2024 and are signed on its behalf by:
Mr Z Al-Najafi
Director
Company Registration No. 07971170
YPP LETTINGS & MANAGEMENT COMPANY LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
- 11 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 January 2022
1,000
(686,527)
(685,527)
Year ended 31 December 2022:
Loss and total comprehensive income for the year
-
(287,490)
(287,490)
Balance at 31 December 2022
1,000
(974,017)
(973,017)
Year ended 31 December 2023:
Loss and total comprehensive income for the year
-
(73,388)
(73,388)
Balance at 31 December 2023
1,000
(1,047,405)
(1,046,405)
The notes on pages 12 to 22 form part of these financial statements.
YPP LETTINGS & MANAGEMENT COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 12 -
1
Accounting policies
Company information
YPP Lettings & Management Company Limited is a private company limited by shares incorporated in England and Wales. The registered office is 6 Blenheim Terrace, Leeds. LS2 9HZ.
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. The disclosure requirements 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.
This company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements:
section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;
section 11 ‘Financial Instruments paragraphs’ 11.42, 11.44, 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b), 11.48(c);
section 12 ‘Other Financial Instrument paragraphs' 12.26, 12.27, 12.29(a), 12.29(b), and 12.29A; and
section 33 ‘Related Party Disclosures’.
This information is included in the consolidated financial statements of YPP Holdings Limited as at 31st December 2023 and these financial statements may be obtained from 6 Blenheim Terrace, Leeds, England, LS2 9HZ.
1.2
Going concern
The company made a loss after tax for the year of £73,388 (2022: £287,490) and has net liabilities of £1,046,405 (2022: £973,017). The directors have made an assessment of the company's ability to continue as a going concern for the foreseeable future. The company has obtained a letter of support from the parent company for the provision of financial support however the company has put measures in place where appropriate to reduce the company's expenditure and the directors have also considered the group profit after tax for the year of £3,950,885 (2022: £2,425,366) and net assets of £6,850,817 (2022: £3,853,125). The directors therefore have no doubt over the company's ability to continue as a going concern for the foreseeable future. true
The company has undertaken a going concern assessment considering the principal risks and current and projected financial position over the going concern period of 12 months from the date of sign-off. The Directors are therefore able to conclude that they have a reasonable expectation that the company has adequate resources to continue in operational existence and meet its liabilities as they fall due for the next 12 months and have accordingly prepared the financial statements on the going concern basis.
YPP LETTINGS & MANAGEMENT COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 13 -
1.3
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
Turnover is the recognition of rental income on a lease and sub-lease agreement with landlords.
When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.
1.4
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:
Computers
33% 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.
1.5
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). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
1.6
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks and other short-term liquid investments with original maturities of three months or less. Interest income on short-term liquid investments is recognised in the profit or loss in the period in which the income is received.
YPP LETTINGS & MANAGEMENT COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 14 -
1.7
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 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 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.
Impairment of financial assets
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
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.
YPP LETTINGS & MANAGEMENT COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 15 -
Basic financial liabilities
Basic financial liabilities, including creditors and loans from fellow group companies 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.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.
1.8
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.
1.9
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.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.10
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.11
Profit and loss account
The profit and loss represent cumulative profits and losses, net of dividends paid and other adjustments.
1.12
Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid.
YPP LETTINGS & MANAGEMENT COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 16 -
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.
In preparing these financial statements, the Directors have had to make following judgements:
Client monies held has been included in the balance sheet, as it arises from a lease and sub-lease agreement with landlords and as a result the company has control over those client monies. See note 12 for breakdown of cash.
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.
3
Turnover and other revenue
An analysis of the company's turnover is as follows:
2023
2022
£
£
Turnover analysed by class of business
Lettings management
21,655,609
18,101,879
2023
2022
£
£
Turnover analysed by geographical market
UK
21,655,609
18,101,879
4
Operating loss
2023
2022
Operating loss for the year is stated after charging:
£
£
Fees payable to the company's auditor for the audit of the company's financial statements as borne by the group
7,500
10,500
Depreciation of tangible fixed assets
4,029
1,779
5
Directors' remuneration
2023
2022
£
£
Remuneration for qualifying services
6,286
YPP LETTINGS & MANAGEMENT COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 17 -
6
Employees
The average monthly number of persons (excluding directors) employed by the company during the year was:
2023
2022
Number
Number
76
88
Their aggregate remuneration comprised:
2023
2022
£
£
Wages and salaries
2,067,971
1,766,265
Social security costs
192,295
160,349
Pension costs
40,250
34,345
2,300,516
1,960,959
The emoluments of the Directors are paid by a fellow group undertaking, which makes no recharge to the Company. They are Directors of a number of fellow subsidiaries and it is not possible to make an accurate appointment of their emoluments in respect of each of the subsidiaries.
The directors' are considered to be key management personnel.
7
Interest receivable and similar income
2023
2022
£
£
Interest income
Interest on bank deposits
202,839
28
2023
2022
Investment income includes the following:
£
£
Interest on financial assets not measured at fair value through profit or loss
23,745
28
8
Interest payable and similar expenses
2023
2022
£
£
Other finance costs:
Other interest
696
YPP LETTINGS & MANAGEMENT COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 18 -
9
Taxation
The actual charge for the year can be reconciled to the expected credit for the year based on the profit or loss and the standard rate of tax as follows:
2023
2022
£
£
Loss before taxation
(73,388)
(287,490)
Expected tax credit based on the standard rate of corporation tax in the UK of 23.52% (2022: 19.00%)
(17,261)
(54,623)
Tax effect of expenses that are not deductible in determining taxable profit
88
(338)
Unutilised tax losses carried forward
4,556
Group relief
14,602
54,961
Permanent capital allowances in excess of depreciation
(1,985)
Taxation charge for the year
-
-
10
Tangible fixed assets
Computers
£
Cost
At 1 January 2023
6,804
Additions
11,887
At 31 December 2023
18,691
Depreciation
At 1 January 2023
3,194
Depreciation charged in the year
4,029
At 31 December 2023
7,223
Carrying amount
At 31 December 2023
11,468
At 31 December 2022
3,610
YPP LETTINGS & MANAGEMENT COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 19 -
11
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
4,756,764
1,783,034
Amounts owed by group undertakings
323,802
586,049
Other debtors
995,130
113,853
Prepayments and accrued income
51,426
43,648
6,127,122
2,526,584
2023
2022
Amounts falling due after more than one year:
£
£
Other debtors
300,000
Total debtors
6,427,122
2,526,584
Amounts owed by Group undertakings are unsecured, repayable on demand and interest free.
12
Cash
2023
2022
£
£
Cash at banks and in hand
7,673,868
5,307,815
Included in total cash of £7,673,868 (2022: £5,307,815) is £7,144,267 (2022: £5,172,188) of restricted cash in respect of client monies held on behalf of clients.
13
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
3,938,709
1,652,817
Amounts owed to group undertakings
624,456
407,789
Taxation and social security
89,281
22,045
Other creditors
2,572,870
169,209
Accruals
1,942,389
1,413,500
Deferred income
5,991,158
5,145,666
15,158,863
8,811,026
Amounts owed to Group undertakings are unsecured, repayable on demand and interest free.
YPP LETTINGS & MANAGEMENT COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 20 -
14
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2023
2022
£
£
Within one year
79,080
103,756
In two to five years
122,184
254,776
In over five years
8,333
159,138
209,597
517,670
15
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
40,250
34,345
The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.
16
Share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
1,000 Ordinary shares of £1 each
1,000
1,000
1,000
1,000
During the year, Dales Investments Holdings Limited (Co. Number 12765027) purchased 40% of the entire issued share capital of the Company.
Later in the year, the entire issued share capital of the Company was allotted to Y&D Holdco Limited (Co. Number 14984379), a Company controlled by YPP Holdings Limited.
YPP LETTINGS & MANAGEMENT COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 21 -
17
Related party transactions
As 100% of the voting rights of the Company are controlled within the group headed by YPP Holdings Limited the Company has taken advantage of the exemption contained in section 33.1A of FRS 102 and has therefore not disclosed transactions or balances with entities which form part of the Group.
YPP Lettings & Management Company Limited and MAAN Investments Limited are controlled by the Al-Najafi family.
Transactions between the Group and its related parties are disclosed below. Related parties are those entities which are controlled or jointly controlled by MAAN including those entities where the Al-Najafi family have significant influence.
Turnover and cost
YPP Lettings & Management Company Limited entered into the following transactions with related parties who are not members of the Group:
2023
2022
Turnover
Cost
Turnover
Cost
£
£
£
£
Alphabet Enterprises Limited (Jersey No. 125831)
757,680
606,064
746,513
597,211
Black Caviar Holdings Limited (Jersey No. 141912)
762,451
609,961
Black Caviar Property Limited (Jersey No. 118885)
55,000
Crescent Enterprises Limited (Jersey No. 126057)
505,054
404,043
Crescent Holdings Limited (Jersey No. 145321)
138,622
110,898
Goodwood Estates Limited (Jersey No. 125297)
135,000
162,000
Minshull Investments Holdings Limited (Jersey No. 136498)
541,319
432,838
509,466
407,557
Rose Gold Estates Limited (Jersey No. 117299)
33,424
-
Signature Black Holdings Limited (Jersey No. 127077)
1,016,352
810,808
1,014,398
811,518
St Albans Estates Limited (Jersey No. 127223)
1,508,793
1,205,199
1,535,318
1,228,254
St James Holdings Limited (Jersey No. 132622)
900,188
719,334
800,320
640,256
X&X Holdings Limited (Jersey No. 127069)
1,385,333
1,108,187
1,451,574
1,161,259
YPP LETTINGS & MANAGEMENT COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
17
Related party transactions
(Continued)
- 22 -
Amounts due from/to related parties
YPP Lettings & Management Company Limited had the following balances, outstanding at year end with related parties who are not members of the Group:
Amounts due from/(to)
related parties
2023
2022
£
£
Alphabet Enterprises Limited (Jersey No. 125831)
27,173
11,992
Black Caviar Holdings Limited (Jersey No. 141912)
93,473
Black Caviar Property Limited (Jersey No. 118885)
3,570
Crescent Enterprises Limited (Jersey No. 126057)
17,224
Crescent Holdings Limited (Jersey No. 145321)
8,358
Goodwood Estates Limited (Jersey No. 125297)
162,762
Minshull Investments Holdings Limited (Jersey No. 136498)
19,962
8,574
Rose Gold Estates Limited (Jersey No. 117299)
(19,100)
Signature Black Holdings Limited (Jersey No. 127077)
35,401
16,470
St Albans Estates Limited (Jersey No. 127223)
52,381
25,686
St James Holdings Limited (Jersey No. 132622)
30,224
14,911
X&X Holdings Limited (Jersey No. 127069)
47,328
23,050
All sales and other transactions were conducted on normal trading terms to the related parties.
Key management personnel are considered to be the directors. The total compensation paid to key management personnel for services provided to the group are disclosed in note 6.
18
Ultimate controlling party
The immediate parent undertaking is Y&D Holdco Limited, a company registered in England and Wales. The registered office of Y&D Holdco Limited is 6 Blenheim Terrace, Leeds, England, LS2 9HZ.
The group in which the results are consolidated is that headed by YPP Holdings Limited. Copies of the YPP Holdings Limited consolidated financial statements can be obtained from Companies House, Crown Way, Cardiff, CF14 3UZ.
The ultimate controlling party of YPP Holdings Limited is the Al Najafi family.
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