Limited Liability Partnership Registration No. OC324399 (England and Wales)
RMH (Guildford) LLP
Annual Report and Financial Statements
For the year ended 31 December 2023
RMH (Guildford) LLP
Limited liability partnership information
Designated members
Harbour Hotels Group Limited
RMH (Guildford) Limited
Limited liability partnership number
OC324399
Registered office
Harbour House
60 Purewell
Christchurch
England
BH23 1ES
Auditor
Fiander Tovell Limited
Stag Gates House
63 - 64 The Avenue
Southampton
SO17 1XS
RMH (Guildford) LLP
Contents
Page
Members' report
1 - 3
Independent auditor's report
4 - 6
Statement of comprehensive income
7
Statement of financial position
8
Reconciliation of members' interests
9
Notes to the financial statements
10 - 21
RMH (Guildford) LLP
Members' report
For the year ended 31 December 2023
- 1 -

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

Principal activities

The principal activity of the Limited Liability Partnership continued to be that of owning and operating a hotel.

Fair review of the business

Building on the momentum of last year, 2023 presented both opportunities and hurdles. The year saw revenue growth in some key income streams compared to 2022, showcasing the company’s resilience and at the same time highlighting the challenges the business continues to face. A strategic focus on luxury experiences remained a key driver. Refurbishment of the conference facilities completed in late 2023 attracting an increased number of guests and contributing to the result achieved.

 

The adaptability honed during the pandemic also proved valuable, allowing the business to cater to evolving preferences like increased demand for staycations and wellness offerings. However, rising costs driven by the high-inflation environment experienced in the UK squeezed margins with labour and utility costs particularly impacted in the year. The challenges were met through disciplined cost control measures and a greater emphasis on labour efficiency.

 

Looking ahead, the partnership anticipates it will continue to operate in an environment of economic uncertainty and evolving consumer demands. To navigate this, it will:

 

By staying agile, focused on excellence, and responsive to evolving needs, the business is confident in delivering sustainable value to stakeholders in 2024 and beyond.

 

Members' drawings, contributions and repayments

Each Member's subscription to the capital of the Limited Liability Partnership is determined by their share of the profit and is repayable following retirement from the Limited Liability Partnership.

 

Details of changes in Members' capital in the year ended 31 December 2023 are set out in the reconciliation of members' interests.

 

Members are remunerated from the profits of the Limited Liability Partnership and are required to make their own provision for pensions and other benefits. Profits are allocated and divided between Members after finalisation of the financial statements. Members draw a proportion of their profit shares monthly during the year in which it is made, with the balance of profits being distributed after the year, subject to the cash requirements of the business.

 

The Members’ drawing policy allows each Member to draw a proportion of their profit share up to an amount that has accrued in their current account, subject to the cash requirements of the business.

 

No Member shall contribute, or be required to contribute, any additional capital unless agreed in writing by all the Members. New Members shall only be admitted if the admission is unanimously approved in writing by the Members. Such admission is permitted under the terms of the members agreement and the new Member executes a Deed of Adherence.

 

Capital contributed by each Member is divided into shares of £1 each.

 

The Limited Liability Partnership has an unconditional right to refuse repayment to the Members of initial amounts contributed by them and as such these amounts will be classified as equity. The Limited Liability Partnership does not have such an unconditional right with regards to contributions received from/loans issued to the Members and as such they will be classified as liabilities/debts, to be included within loans and other debts due to/from Members.

RMH (Guildford) LLP
Members' report (continued)
For the year ended 31 December 2023
- 2 -
Designated members

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

Harbour Hotels Group Limited
RMH (Guildford) Limited
Members' insurance

The Limited Liability Partnership maintains insurance policies on behalf of all the Members against liability arising from negligence, breach of duty and breach of trust in relation to the Limited Liability Partnership.

Auditor

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

Statement of members' responsibilities

The Members are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

 

Company law (as applied by The Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008) requires the members to prepare financial statements for each financial year. Under that law the Members have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice. Under company law (as applied by The Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008) the Members 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 Limited Liability Partnership and of the profit or loss of the Limited Liability Partnership for that period.

 

In preparing these financial statements, the Members are required to:

 

The Members are responsible for keeping adequate accounting records that are sufficient to show and explain the Limited Liability Partnership’s transactions and disclose with reasonable accuracy at any time the financial position of the Limited Liability Partnership and enable them to ensure that the financial statements comply with the Companies Act 2006 (as applied by The Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008). They are also responsible for safeguarding the assets of the Limited Liability Partnership and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Statement of disclosure to auditor

Each of the Members in office at the date of approval of this annual report confirms that:

 

RMH (Guildford) LLP
Members' report (continued)
For the year ended 31 December 2023
- 3 -
Going concern

The Members have carried out a thorough assessment of the Limited Liability Partnership's financial position and performance, taking into account various factors, including current and projected cash flows, financial obligations, and available resources. Based on this assessment, the Members have formed the opinion that the Limited Liability Partnership has adequate financial resources to meet its obligations and continue operating for the foreseeable future, at least for the next 12 months from the date of this report.

 

In making this assessment, the Members have considered both internal and external factors that may impact the Limited Liability Partnership's ability to continue as a going concern. These factors include market conditions, competitive landscape, regulatory changes, and potential risks and uncertainties. The Members have also considered the Limited Liability Partnership's current and future liquidity position, including its ability to generate sufficient cash flows, access additional funding if required, and manage its working capital requirements.

 

It is important to note that the assessment of going concern is based on various assumptions, estimates, and judgments, which are inherently uncertain and subject to change. The Members will continue to monitor the Limited Liability Partnership's financial performance and position, regularly reviewing its ability to operate as a going concern and taking appropriate actions if circumstances change.

 

In conclusion, based on the Members' assessment, the Limited Liability Partnership is considered to be a going concern, as it has adequate financial resources, liquidity, and operational plans in place to support its ongoing operations for the foreseeable future. The members report provides a transparent and balanced view of the Limited Liability Partnership's prospects, highlighting any significant risks and uncertainties that may impact its ability to operate as a going concern in the future.

For more information regarding the basis of preparation see note 1 to the financial statements.

Approved by the Members on 24 September 2024 and signed on behalf by:
RMH (Guildford) Limited
Designated Member
RMH (Guildford) LLP
Independent auditor's report
to the members of RMH (Guildford) LLP
- 4 -
Opinion

We have audited the financial statements of RMH (Guildford) LLP (the 'Limited Liability Partnership') for the year ended 31 December 2023 which comprise the statement of comprehensive income, the statement of financial position, the reconciliation of members' interests 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 FRS 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 Limited Liability Partnership 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 Members' 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 Limited Liability Partnership’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 Members 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 Members 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.

Other Companies Act 2006 reporting as applied to limited liability partnerships

We have nothing to report in respect of the following matters where the Companies Act 2006 as applied to limited liability partnerships requires us to report to you if, in our opinion:

 

RMH (Guildford) LLP
Independent auditor's report (continued)
to the members of RMH (Guildford) LLP
- 5 -
Responsibilities of members

As explained more fully in the members' responsibilities statement, the Members 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 Members 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 Members are responsible for assessing the Limited Liability Partnership'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 Members either intend to liquidate the Limited Liability Partnership 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.

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:

We assessed the susceptibility of the Limited Liability Partnership’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

RMH (Guildford) LLP
Independent auditor's report (continued)
to the members of RMH (Guildford) LLP
- 6 -
Audit response to risks identified

To address the risk of fraud through management bias and override of controls, we:

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

There are inherent limitations in our audit procedures described above. The more removed those laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the Members and other management and the inspection of regulatory and legal correspondence, if any.

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

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 limited liability partnership's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006 as applied by the Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008. Our audit work has been undertaken so that we might state to the limited liability partnership'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 limited liability partnership and the limited liability partnership's members as a body, for our audit work, for this report, or for the opinions we have formed.

Andrew Jay ACA FCCA (Senior Statutory Auditor)
For and on behalf of Fiander Tovell Limited
24 September 2024
Chartered Accountants
Statutory Auditor
Stag Gates House
63 - 64 The Avenue
Southampton
SO17 1XS
RMH (Guildford) LLP
Statement of comprehensive income
For the year ended 31 December 2023
- 7 -
2023
2022
Notes
£
£
Turnover
3
10,120,286
9,306,374
Cost of sales
(4,340,683)
(3,909,690)
Gross profit
5,779,603
5,396,684
Administrative expenses
(3,504,239)
(3,101,441)
Other operating income
3
-
6,000
Operating profit
4
2,275,364
2,301,243
Interest payable and similar expenses
6
(1,421,989)
(1,076,741)
Profit for the financial year before members' remuneration and profit shares available for discretionary division among members
853,375
1,224,502

The income statement has been prepared on the basis that all operations are continuing operations.

RMH (Guildford) LLP
Statement of financial position
As at 31 December 2023
- 8 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
7
41,990,143
41,990,295
Investments
8
5
5
41,990,148
41,990,300
Current assets
Stocks
10
75,997
72,993
Debtors
11
5,545,147
1,344,023
Cash at bank and in hand
43,963
210,794
5,665,107
1,627,810
Creditors: amounts falling due within one year
12
(4,187,965)
(3,762,961)
Net current assets/(liabilities)
1,477,142
(2,135,151)
Total assets less current liabilities
43,467,290
39,855,149
Creditors: amounts falling due after more than one year
13
(29,953,363)
(27,194,597)
Net assets attributable to members
13,513,927
12,660,552
Represented by:
Members' other interests
Members' capital classified as equity
20,000
20,000
Revaluation reserve
12,157,372
12,157,372
Other reserves classified as equity
1,336,555
483,180
13,513,927
12,660,552
The financial statements were approved by the members and authorised for issue on 24 September 2024 and are signed on their behalf by:
RMH (Guildford) Limited
Designated member
Limited Liability Partnership Registration No. OC324399
RMH (Guildford) LLP
Reconciliation of members' interests
For the year ended 31 December 2023
- 9 -
Current financial year
Equity
Total
Members' other interests
Members' Interests
Members' capital
Revaluation
reserve
Other reserves
Total
2023
£
£
£
£
Members' interests at 1 January 2023
20,000
12,157,371
483,179
12,660,550
Profit for the financial year available for discretionary division among members
-
-
853,375
853,375
Members' interests after profit for the year
20,000
12,157,371
1,336,554
13,513,925
Members' interests at 31 December 2023
20,000
12,157,371
1,336,554
13,513,925
Prior financial year
Equity
Total
Members' other interests
Members' Interests
Members' capital
Revaluation
reserve
Other reserves
Total
2022
£
£
£
£
Members' interests at 1 January 2022
20,000
12,157,372
(741,322)
11,436,050
Profit for the financial year available for discretionary division among members
-
-
1,224,502
1,224,502
Members' interests after profit for the year
20,000
12,157,372
483,180
12,660,552
Members' interests at 31 December 2022
20,000
12,157,372
483,180
12,660,552
RMH (Guildford) LLP
Notes to the financial statements
For the year ended 31 December 2023
- 10 -
1
Accounting policies
Limited liability partnership information

RMH (Guildford) LLP is a limited liability partnership incorporated in England and Wales. The registered office is Harbour House, 60 Purewell, Christchurch, England, BH23 1ES.

 

The limited liability partnership's principal activities are disclosed in the Members' Report.

1.1
Accounting convention

These financial statements have been prepared in accordance with the Statement of Recommended Practice "Accounting by Limited Liability Partnerships" issued in December 2018, together 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 financial statements are prepared in sterling, which is the functional currency of the limited liability partnership. 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 the revaluation of leasehold properties at fair value. The principal accounting policies adopted are set out below.

This limited liability partnership 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 limited liability partnership, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The limited liability partnership has therefore taken advantage of exemptions from the following disclosure requirements:

 

 

The financial statements of the limited liability partnership are consolidated in the financial statements of Harbour International Limited . These consolidated financial statements may be obtained from Companies House, Crown Way, Cardiff, CF14 3UZ.

1.2
Going concern

At the time of approving the financial statements, the members have a reasonable expectation that the limited liability partnership has adequate resources to continue in operational existence for the foreseeable future. Thus the members continue to adopt the going concern basis of accounting in preparing the financial statements.

1.3
Turnover

Turnover represents amounts receivable from the provision of hotel services, recognised net of VAT at the point of service to the customer.

RMH (Guildford) LLP
Notes to the financial statements (continued)
For the year ended 31 December 2023
1
Accounting policies
(continued)
- 11 -
1.4
Members' participating interests

Members' participation rights are the rights of a member against the LLP that arise under the members' agreement (for example, in respect of amounts subscribed or otherwise contributed remuneration and profits).

 

Members' participation rights in the earnings or assets of the LLP are analysed between those that are, from the LLP's perspective, either a financial liability or equity, in accordance with section 22 of FRS 102. A member's participation rights including amounts subscribed or otherwise contributed by members, for example members' capital, are classed as liabilities unless the LLP has an unconditional right to refuse payment to members, in which case they are classified as equity.

All amounts due to members that are classified as liabilities are presented within 'Loans and other debts due to members' and, where such an amount relates to current year profits, they are recognised within ‘Members' remuneration charged as an expense’ in arriving at the relevant year’s result. Undivided amounts that are classified as equity are shown within ‘Members' other interests’. Amounts recoverable from members are presented as debtors and shown as amounts due from members within members’ interests.

 

Where there exists an asset and liability component in respect of an individual member’s participation rights, they are presented on a gross basis unless the LLP has both a legally enforceable right to set off the recognised amounts, and it intends either to settle on a net basis or to settle and realise these amounts simultaneously, in which case they are presented net.

Profits are automatically divided as they arise, so the LLP does not have an unconditional right to refuse payment and the amounts arising that are due to members are in the nature of liabilities. They are therefore treated as an expense and presented as members remuneration charged as an expense in arriving at the result for the relevant year. To the extent that they remain unpaid at the period end, they are shown as liabilities.

Whilst the members’ agreement does not differentiate between profits and losses for profit sharing purposes, it does stipulate that the LLP cannot demand additional contributions from members, and as a result the LLP does not have an unconditional right to demand payment from members for losses. Therefore, to the extent that losses exceed the balance on capital and current accounts, they are not recognised as a recoverable asset and so remain within equity until such time as profits are generated to set them against or detail other conditions as appropriate.

Once an unavoidable obligation has been created in favour of members through allocation of profits or other means, any undrawn profits remaining at the reporting date are shown as ‘Loans and other debts due to members’ to the extent they exceed debts due from a specific member.

1.5
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:

Leasehold land and buildings
50 years straight line
Plant and equipment
6% straight line
Fixtures and fittings
15% straight line
Computers
25% straight line
Motor vehicles
20% straight line
Finance lease asset
Nil

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 recognised in the income statement.

RMH (Guildford) LLP
Notes to the financial statements (continued)
For the year ended 31 December 2023
1
Accounting policies
(continued)
- 12 -
1.6
Fixed asset investments

Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.

A subsidiary is an entity controlled by the limited liability partnership. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

1.7
Impairment of fixed assets

At each reporting period end date, the limited liability partnership 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 limited liability partnership 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.

1.8
Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis.

1.9
Cash and cash equivalents

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.

1.10
Financial instruments

The partnership only enters into basic financial instruments transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, and loans from related parties.

 

Financial liabilities and equity are classified according to the substance of the financial instrument's contractual obligations, rather than its legal form.

 

Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. lf objective evidence of impairment is found, an impairment loss is recognised in the statement of comprehensive income.

RMH (Guildford) LLP
Notes to the financial statements (continued)
For the year ended 31 December 2023
1
Accounting policies
(continued)
- 13 -
Other financial assets

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

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 limited liability partnership 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.

Other financial liabilities

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

 

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

Derecognition of financial liabilities

Financial liabilities are derecognised when the limited liability partnership’s obligations expire or are discharged or cancelled.

RMH (Guildford) LLP
Notes to the financial statements (continued)
For the year ended 31 December 2023
1
Accounting policies
(continued)
- 14 -
1.11
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 limited liability partnership is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

1.12
Retirement benefits and post retirement payments to members

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

1.13
Leases

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.

 

Assets held under finance leases are recognised as assets at the lower of the assets fair value at the date of inception and the present value of the minimum lease payments. The related liability is included in the statement of financial position as a finance lease obligation. Lease payments are treated as consisting of capital and interest elements. The interest is charged to profit or loss so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

1.14
Government grants

Grants are accounted for under the accruals model as permitted by FRS 102. Grants relating to expenditure on tangible fixed assets are credited to the statement of income and retained earnings at the same rate as the depreciation on the assets to which the grant relates. The deferred element of grants is included in creditors as deferred income.

Grants of a revenue nature are recognised in the statement of income and retained earnings in the same period as the related expenditure.

1.15
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.

RMH (Guildford) LLP
Notes to the financial statements (continued)
For the year ended 31 December 2023
- 15 -
2
Judgements and key sources of estimation uncertainty

In the application of the limited liability partnership’s accounting policies, the members 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.

Critical judgements

The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.

Leases

Determine whether leases entered into by the partnership either as a lessor or a lessee are operating leases or finance leases. These decisions depend on an assessment of whether the risks and rewards of ownership have been transferred from the lessor to the lessee on a lease by lease basis.

Impairment of assets

Determine whether there are indicators of impairment of the partnership's tangible assets. Factors taken into consideration in reaching such a decision include the economic viability and expected future financial performance of the asset and where it is a component of a larger cash-generating unit, the viability and expected future performance of that unit.

Disposal of assets

Where an asset is replaced and historic cost information pertaining to the original asset is not readily available, then the value is assigned to the year seen as most appropiate, and an RPI adjustment is made to determine the original purchase price.

Tax charge

The calculation of the partnership's tax charge involves a degree of estimation and judgement in respect of certain items, including the differences between the accounting and tax base; which assets qualify for capital allowances; the level of disallowable expenditure; the extent of rollover gains; indexation thereon and the tax base into which they are rolled; the amount of deferred tax assets which can be recognised, based upon the likely timing and level of future taxable profits together with an assessment of future tax planning.

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.

Tangible fixed assets

Tangible fixed assets are depreciated over their useful lives taking into account residual values, where appropriate. The actual lives of the assets and residual values are assessed annually and may vary depending on a number of factors such as future economic viability, utilisation and continued relevance of the asset.

Leasehold property

Leasehold property is revalued by an independent valuation expert on a regular basis such that the carrying value is in line with the prevailing market rates. The valuation uses the profit method which is based on the partnership's

estimates and assumptions concerning its future revenue growth, trading and cash flows.

RMH (Guildford) LLP
Notes to the financial statements (continued)
For the year ended 31 December 2023
- 16 -
3
Turnover and other income

An analysis of the limited liability partnership's turnover is as follows:

2023
2022
£
£
Turnover analysed by class of business
Provision of hotel services
10,120,286
9,306,374
2023
2022
£
£
Other operating income
Grants received
-
6,000

Turnover is attributable to the principal activity of the partnership wholly undertaken in the United Kingdom.

The partnership received monies during the previous year in respect of Business Rates Relief support grants.

4
Operating profit
2023
2022
Operating profit for the year is stated after charging/(crediting):
£
£
Government grants
-
(6,000)
Fees payable to the LLP's auditor for the audit of the LLP's financial statements
9,000
8,600
Depreciation of owned tangible fixed assets
500,044
483,972
Loss on disposal of tangible fixed assets
15,533
41,072
Operating lease - ground rent and license to occupy
310,000
310,000
5
Employees

The average number of persons (excluding members) employed by the partnership during the year was:

2023
2022
Number
Number
Hotel staff
169
139

Their aggregate remuneration comprised:

2023
2022
£
£
Wages and salaries
2,647,279
2,014,446
Social security costs
195,688
165,567
Pension costs
37,581
32,972
2,880,548
2,212,985
RMH (Guildford) LLP
Notes to the financial statements (continued)
For the year ended 31 December 2023
5
Employees
(continued)
- 17 -

The members did not receive any emoluments in respect of their current and prior year services to the LLP because their services to the LLP were merely incidental to their services to the group as a whole.

6
Interest payable and similar expenses
2023
2022
£
£
Interest payable to group undertakings
805,058
547,056
Other finance costs:
Interest on finance leases and hire purchase contracts
616,931
529,685
Total finance costs
1,421,989
1,076,741
RMH (Guildford) LLP
Notes to the financial statements (continued)
For the year ended 31 December 2023
- 18 -
7
Tangible fixed assets
Leasehold land and buildings
Assets under construction
Plant and equipment
Fixtures and fittings
Computers
Motor vehicles
Finance lease asset
Total
£
£
£
£
£
£
£
£
Cost or valuation
At 1 January 2023
29,023,903
-
1,178,776
1,586,262
342,409
23,045
11,380,000
43,534,395
Additions
146,357
183,666
48,986
119,114
17,301
-
-
515,424
Disposals
-
-
(2,387)
(27,387)
-
-
-
(29,774)
At 31 December 2023
29,170,260
183,666
1,225,375
1,677,989
359,710
23,045
11,380,000
44,020,045
Depreciation and impairment
At 1 January 2023
210,653
-
391,083
657,040
270,480
14,844
-
1,544,100
Depreciation charged in the year
124,942
-
72,665
243,611
55,332
3,494
-
500,044
Eliminated in respect of disposals
-
-
(868)
(13,374)
-
-
-
(14,242)
At 31 December 2023
335,595
-
462,880
887,277
325,812
18,338
-
2,029,902
Carrying amount
At 31 December 2023
28,834,665
183,666
762,495
790,712
33,898
4,707
11,380,000
41,990,143
At 31 December 2022
28,813,250
-
787,693
929,222
71,929
8,201
11,380,000
41,990,295
RMH (Guildford) LLP
Notes to the financial statements (continued)
For the year ended 31 December 2023
- 19 -

Leasehold property along with fixtures, fittings and equipment were revalued at 31 December 2021 by Avison Young (UK) Limited, independent valuers not connected with the partnership, on the basis of market value under the profits method. The valuation, which is consistent with similar properties, conforms to RICS Valuation Professional Standards. The members have considered the valuation as at 31 December 2023 and do not consider it to be materially different from the Avison Young (UK) Limited valuation previously adopted.

 

The following assets are carried at valuation. If the assets were measured using the cost model, the carrying amounts would be as follows:

Leasehold property
2023
2022
£
£
Cost
20,592,293
20,445,936
8
Fixed asset investments
2023
2022
Notes
£
£
Investments in subsidiaries
9
5
5
9
Subsidiaries

These financial statements are separate limited liability partnership financial statements for RMH Guildford LLP.

Details of the limited liability partnership's subsidiaries at 31 December 2023 are as follows:

Name of undertaking
Registered office
Class of
% Held
shares held
Direct
RMH (Guildford) Management Limited
Harbour House, 60 Purewell, Christchurch, BH23 1ES
Ordinary
100.00
RMH (Guildford) Residential Developments Limited
Harbour House, 60 Purewell, Christchurch, BH23 1ES
Ordinary
100.00
10
Stocks
2023
2022
£
£
Raw materials and consumables
75,997
72,993
RMH (Guildford) LLP
Notes to the financial statements (continued)
For the year ended 31 December 2023
- 20 -
11
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
126,527
131,069
Amounts owed by group undertakings
4,991,730
962,756
Other debtors
70,638
31,910
Prepayments and accrued income
356,252
218,288
5,545,147
1,344,023

Amounts owed by group undertakings are interest free and repayable on demand.

12
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
273,793
138,138
Amounts owed to group undertakings
2,825,458
2,623,267
Other taxation and social security
380,571
412,092
Other creditors
381,283
216,792
Accruals and deferred income
326,860
372,672
4,187,965
3,762,961

Amounts owed to group undertakings are interest free and repayable on demand.

13
Creditors: amounts falling due after more than one year
2023
2022
Notes
£
£
Obligations under finance leases
14
11,125,008
11,125,008
Amounts owed to group undertakings
18,828,355
16,069,589
29,953,363
27,194,597

Borrowing terms and rates for amounts owed to group undertakings changed in the year. Amounts are now repayable on 31 March 2027 and interest is charged at 4.5% per annum in respect of the issued loans.

14
Finance lease obligations
2023
2022
Future minimum lease payments due under finance leases:
£
£
In over five years
11,125,008
11,125,008
RMH (Guildford) LLP
Notes to the financial statements (continued)
For the year ended 31 December 2023
14
Finance lease obligations
(continued)
- 21 -

In 2013 the LLP entered into a sale and leaseback arrangement with a third party in respect of an interest in the hotel’s freehold land. The lease is for a term of 994 years, with annual payments of £622,000 (2022: £530,000) per annum increasing with movements in RPI. The arrangement resulted in a finance lease with the proceeds of £11,380,000 being recognised as a liability net of costs of £254,992. Because the term is so long, measuring the liability at amortised cost using the effective interest method results in no reduction of the liability for the foreseeable future. The land subject to the finance lease arrangement has been shown within fixed assets as a separate class of asset which is not subject to depreciation at a cost equivalent to the proceeds received.

 

15
Retirement benefit schemes
2023
2022
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
37,581
32,972

The limited liability partnership operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the limited liability partnership in an independently administered fund.

16
Financial commitments, guarantees and contingent liabilities

The bank loans of Harbour Hotels Group Limited, an intermediate parent company, are secured by a cross guarantee and a fixed and floating charge debenture over the LLP's assets.

17
Related party transactions
Transactions with related parties

During the year the limited liability partnership entered into the following transactions with related parties:

Other information

The partnership has taken advantage of the exemption available in Section 33.1A of FRS 102 whereby it has not disclosed transactions between group companies who are wholly owned within the group.

18
Ultimate controlling party

The company is a wholly owned subsidiary of RMH (Guildford) Limited. The ultimate parent company is Global Reach UK Holdings Limited, a company in which Turnstone (Isle of Man) Limited is considered the ultimate controlling party. The financial statements for Global Reach UK Holdings Limited are publicly available from Companies House, Crown Way, Cardiff, CF14 3UZ.

 

The smallest group in which the results of the company are consolidated is that headed by Harbour Hotels Group Limited and the largest group in which the results of the company are consolidated is that headed by Global Reach UK Holdings Limited. The registered office of Harbour Hotels Group Limited is 60 Purewell, Christchurch, England, BH23 1ES. The registered office of Global Reach UK Holdings Limited is c/o Zedra, Booths Hall, Booths Park 3, Chelford Road, Knutsford, Cheshire, England, WA16 8GS.

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