Company Registration No. SC699082 (Scotland)
LOVE LOAN LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
PAGES FOR FILING WITH REGISTRAR
LOVE LOAN LIMITED
CONTENTS
Page
Balance sheet
1
Notes to the financial statements
2 - 8
LOVE LOAN LIMITED
BALANCE SHEET
- 1 -
2023
2022
as restated
Notes
£
£
£
£
Fixed assets
Tangible assets
4
6,107,169
4,520,690
Current assets
Debtors
5
5,998
13,194
Cash at bank and in hand
548
39,862
6,546
53,056
Creditors: amounts falling due within one year
6
(3,286,965)
(3,097,299)
Net current liabilities
(3,280,419)
(3,044,243)
Total assets less current liabilities
2,826,750
1,476,447
Creditors: amounts falling due after more than one year
7
(2,826,649)
(1,476,346)
Net assets
101
101
Capital and reserves
Called up share capital
8
1
1
Profit and loss reserves
100
100
Total equity
101
101
The directors of the company have elected not to include a copy of the profit and loss account within the financial statements.true
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 24 September 2024 and are signed on its behalf by:
A J Aiton
Director
Company Registration No. SC699082
LOVE LOAN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2023
- 2 -
1
Accounting policies
Company information
Love Loan Limited is a private company limited by shares incorporated in Scotland. The registered office is The Tower, 7 Advocate's Close, Edinburgh, United Kingdom, EH1 1ND.
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
Going concern
Notwithstanding net current liabilities of £3,280,419 as at 30 June 2023, and no profit or loss for the year since the company has not yet commenced trading, the financial statements have been prepared on a going concern basis which the directors consider to be appropriate for the following reasons: true
The directors have prepared a cash flow forecast for the company covering the going concern assessment period, being at least 12 months from the date of approval of these financial statements.
The company meets the day to day working capital requirements from a term facility agreement.
The directors have prepared a cash flow forecast and performed a going concern assessment which indicates that, taking account of reasonably possible downsides, the company will have sufficient funds, through an external financing facility of £8.0m from RBS. The term facility of £8.0m was agreed on 29 July 2024 and is repayable 30 months from the date of the agreement.
The forecasts for this company assume that its creditors under common control of the ultimate controlling party, Christopher Stewart, will not withdraw amounts forwarded to it for the period covered by the forecasts. This has been confirmed in writing by those parties.
Consequently, the directors are confident that the company will have sufficient funds to continue to meet its liabilities as they fall due for at least 12 months from the date of approval of the financial statements and therefore have prepared the financial statements on a going concern basis.
1.3
Reporting period
The financial statements for the current period cover the year ended 30 June 2023. The financial statements for the comparative period cover the period from incorporation on 18 May 2021 to 30 June 2022. As a result, comparative amounts presented in the financial statements (including the related notes) are not entirely comparable.
1.4
Turnover
Turnover represents amounts receivable for rent and service charges net of VAT. Turnover from rent receivable is recognised on a straight line basis.
1.5
Tangible fixed assets
Tangible fixed assets are initially measured at cost and subsequently measured at cost, net of depreciation and any impairment losses.
LOVE LOAN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 3 -
Depreciation is recognised so as to write off the cost of assets less their residual values over their useful lives on the following bases:
Assets under construction
Not depreciated
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 the profit and loss account.
1.6
Borrowing costs related to fixed assets
Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale.
All other borrowing costs are recognised in profit or loss in the period in which they are incurred.
1.7
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 the profit and loss account.
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 the profit and loss account.
1.8
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.9
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.
LOVE LOAN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 4 -
Basic financial assets
Basic financial assets, which include certain 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 certain creditors, bank loans 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.
1.10
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.
1.11
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.
LOVE LOAN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
1
Accounting policies
(Continued)
- 5 -
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.
1.12
The prior period financial statements have been restated to correct for the amount of capitalised expenses recharged from an intra-group company to reflect the actual historical cost of the property. The impact of the restatement on the previously reported balance sheet of the company is a reduction in the carrying value of assets under construction within tangible fixed assets of £1,875,000 and a corresponding reduction in amounts owed to group undertakings within creditors falling due within one year. The restatement has no impact on the previously reported profit or net assets for the year ended 30 June 2022.
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.
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.
Carrying value of fixed assets
The company's assets under construction are carried at valuation. The directors are therefore required to consider the valuation each year to ensure that this remains appropriately stated.
The carrying value of fixed assets at the reporting date is outlined in note 3.
LOVE LOAN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 6 -
3
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Total
4
Tangible fixed assets
Assets under construction
£
Cost
At 1 July 2022 as restated
4,520,690
Additions
1,586,479
At 30 June 2023
6,107,169
Depreciation and impairment
At 1 July 2022 and 30 June 2023
Carrying amount
At 30 June 2023
6,107,169
At 30 June 2022 as restated
4,520,690
Included within freehold land and buildings is borrowing costs of £226,151 (2022: £62,415) directly attributable to the acquisition and development of the assets.
5
Debtors
2023
2022
Amounts falling due within one year:
£
£
Other debtors
5,998
13,194
LOVE LOAN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
- 7 -
6
Creditors: amounts falling due within one year
2023
2022
as restated
£
£
Trade creditors
32,131
77,870
Amounts owed to group undertakings
3,210,641
3,001,440
Other creditors
44,193
17,989
3,286,965
3,097,299
Amounts owed to group undertakings are interest free and repayable on demand.
7
Creditors: amounts falling due after more than one year
2023
2022
£
£
Bank loans and overdrafts
2,826,649
1,476,346
Bank loans and overdrafts are subject to interest and capital repayments with a termination date of January 2025, however was subsequently repaid in full in July 2024 as further detailed in note 9. The loan is secured by fixed and floating charges over the company's property.
8
Called up share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
1
1
1
1
9
Audit report information
As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:
The auditor's report was unqualified.
The senior statutory auditor was James Hamilton and the auditor was Johnston Carmichael LLP.
10
Events after the reporting date
Subsequent to the financial year end, the Company refinanced its loan with OakNorth Bank and entered into a Group facility agreement for £26.6m with RBS, an external third-party loan provider. The Company's allocation of the Group facility is £8.0m.
11
Related party transactions
LOVE LOAN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2023
11
Related party transactions
(Continued)
- 8 -
As at 30 June 2023, the immediate parent company is CSG George Street Limited. The ultimate parent company and the largest group in which the results are consolidated is CSG Commercial Limited, a company whose registered office is 12 Hope Street, Edinburgh, EH2 4DB. The accounts of CSG Commercial Limited can be obtained from the Companies House online register at https://www.gov.uk/government/organisations/companies-house. The ultimate controlling party is Christopher Stewart.
The company has taken advantage of the exemption available in FRS 102 Section 1A whereby it has not disclosed transactions with the immediate parent company or any wholly owned subsidiary undertaking of the group.