Registered number:
FOR THE YEAR ENDED 31 DECEMBER 2023
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THEATRE OF COMEDY COMPANY LIMITED
COMPANY INFORMATION
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THEATRE OF COMEDY COMPANY LIMITED
CONTENTS
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THEATRE OF COMEDY COMPANY LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
The principal activity of the company continued to be that of theatrical management, presentation of shows and the owning and operating of the Shaftesbury Theatre.
2023 saw a tight change of shows in Q2 which resulted in only 5 weeks of the year not welcoming audiences into the Theatre. 2023 was also the start of a new collaborative relationship between the Theatre and the Producers of the new 2023 Musical, which saw an agreement reached for the presentation of a range of musicals at the Theatre for a set period beyond 2024.
This agreement would allow the Theatre’s Management to actively plan further developments to the building during 2024 and beyond. The additional Front of House works were completed in 2023 with the Theatre inviting quests into its new VIP areas in the year. The company successfully launched its Events business and with further planned investment in this area, the company has confidence that this will also expand the Theatre’s reach outside the Theatre Industry. At the end of 2023 the Directors acknowledged that its current Chief Executive planned to retire at the end of 2024. A succession plan was put in place with the search for the new Chief Executive commencing in early 2024 with the new appointment commencing in Q4. The Senior Management are confident that with the current popular production in situ and the new arrangement in place for future Productions, the company will generate sufficient working capital to continue to repay its debt obligations as they fall due. The Directors have reasonable expectation that the company has adequate resources to continue operationally for a period of at least 12 months.
The company faces competitive pressures from other theatre owning groups in London to attract and stage productions at its theatre. There is also the risk that once the production is in the theatre it is not popular with the public. The company carefully manages this risk by working specifically under the new Agreement with the Producers to select the production we both think is most suitable and likely of being successful. The Directors and Management of the company are able to react quickly to producer queries and are able also to maintain and develop strong relationships with new and continuing producers both in the UK and worldwide.
The company's principal financial instruments comprise cash, bank and other loans, debtors and trade and other creditors arising from the normal course of business. The main financial risks to which the company is exposed include liquidity and cash flow risk. These risks are managed by ensuring sufficient liquidity is available to meet liabilities as they fall due.
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THEATRE OF COMEDY COMPANY LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
Given the nature of the business and the close involvement of the shareholders in the running of the business, the company's directors are of the opinion that analysis using KPIs is not necessary for an understanding of the development, performance or position of the business.
Future developments
The company’s management continues to build strong relationships within the industry to ensure that its principal asset, the Shaftesbury Theatre, is occupied with popular and high quality productions. It has entered into an agreement with Producers of the current Production that secures the programming and allows for active timetabling of productions to reduce the length of time the theatre is unoccupied over a period in the short to medium term. To ensure that the theatre remains an attractive venue, the company has a planned rolling repairs, renewals and refurbishment programme which further enhances both back and front of house operations for the company’s end users. Monitoring the performance of productions during their run and working in partnership with the producers allows effective planning for scheduling shows with the theatre.
This report was approved by the board on 7 October 2024 and signed on its behalf.
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THEATRE OF COMEDY COMPANY LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023
The directors present their report and the financial statements for the year ended 31 December 2023.
The directors who served during the year were:
The directors are responsible for preparing the Strategic Report, the Directors' Report and the financial statements in accordance with applicable law and regulations.
In preparing these financial statements, the directors are required to:
∙select suitable accounting policies for the company's financial statements and then apply them consistently;
∙make judgments and accounting estimates that are reasonable and prudent;
∙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 to 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.
The profit for the year, after taxation, amounted to £1,477,708 (2022: £804,426).
No dividends were paid during the year and the directors do not recommend the payment of a dividend.
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THEATRE OF COMEDY COMPANY LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
The auditors, Nyman Libson Paul LLP, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board on
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THEATRE OF COMEDY COMPANY LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THEATRE OF COMEDY COMPANY LIMITED
We have audited the financial statements of Theatre of Comedy Company Limited (the 'company') for the year ended 31 December 2023, which comprise the Profit and Loss Account, the Statement of Comprehensive Income, the Balance Sheet, the Statement of Cash Flows, the Statement of Changes in Equity and the related notes, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
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 Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council'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.
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.
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THEATRE OF COMEDY COMPANY LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THEATRE OF COMEDY COMPANY LIMITED (CONTINUED)
The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' Report thereon. The directors are responsible for the other information contained within the Annual Report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
In our opinion, based on the work undertaken in the course of the 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.
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THEATRE OF COMEDY COMPANY LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THEATRE OF COMEDY COMPANY LIMITED (CONTINUED)
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 Auditors' 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.
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:
We gained an understanding of the legal and regulatory framework applicable to the company and the industry in which it operates, and considered the risk of acts by the company that were contrary to applicable laws and regulations, including fraud. We designed audit procedures to respond to the risk, 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 or intentional misrepresentations, or through collusion.
We focussed on laws and regulations which could give rise to a material misstatement in the financial statements, including, but not limited to, the Companies Act 2006 and UK tax legislation. Our tests included agreeing the financial statement disclosures to underlying supporting documentation, reading minutes of meetings of those charged with governance, enquiries with management and review of accounting estimates. There are inherent limitations in the audit procedures described above 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 would become aware of it. We did not identify any key audit matters relating to irregularities, including fraud. As in all our audits, we also addressed the risk of management override of internal controls, including testing journals and evaluating whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' Report.
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THEATRE OF COMEDY COMPANY LIMITED
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THEATRE OF COMEDY COMPANY LIMITED (CONTINUED)
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 Auditors' 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.
for and on behalf of
Chartered Accountants
Registered Auditors
124 Finchley Road
NW3 5JS
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THEATRE OF COMEDY COMPANY LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2023
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THEATRE OF COMEDY COMPANY LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023
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THEATRE OF COMEDY COMPANY LIMITED
REGISTERED NUMBER: 01678553
BALANCE SHEET
AS AT 31 DECEMBER 2023
The financial statements were approved and authorised for issue by the board and were signed on its behalf on
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STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023
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STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2022
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THEATRE OF COMEDY COMPANY LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2023
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THEATRE OF COMEDY COMPANY LIMITED
ANALYSIS OF NET DEBT
FOR THE YEAR ENDED 31 DECEMBER 2023
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THEATRE OF COMEDY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Theatre of Comedy Company Limited is a private company limited by shares and incorporated in England. The company operates the Shaftesbury Theatre in London and its income is derived from box office, merchandise and bar sales, theatre rental and royalties.
2.Accounting policies
The financial statements have been prepared on a going concern basis under the historical cost convention as modified by the revaluation of land and buildings measured at fair value through profit and loss and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the United Kingdom and the Republic of Ireland and the Companies Act 2006.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies (see note 3).
The company meets its day to day working capital requirements through its own funds and available banking facilities.
The Directors and Senior Management continue to work closely with the producers of the current production and those of future productions secured for the theatre. They are confident that these productions in both the short and long term will prove to be popular and will allow the company to generate the working capital required to repay its debts as they fall due. The Directors and Senior Management continued to work closely with the company's bankers and the loan facilities were renewed in September 2024 with repayments due by single payments in September 2029. After reviewing the company’s forecasts alongside Quarterly Management Reporting, at the time of approving these financial statements the Directors and Senior Management have reasonable expectations that the company has adequate resources to continue its operations for a period of at least 12 months. The Directors and Senior Management therefore consider it appropriate to adopt the going concern basis in preparing the company’s financial statements.
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THEATRE OF COMEDY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
Box office income comprises the sale of tickets for productions held at Shaftesbury Theatre and are recorded net of theatre rent due to the company. Box office receipts are initially credited to deferred income and are recognised as income once the performance to which the advance sale relates has taken place. Ticketing income comprises fees and commissions which are included within the theatre ticket price and is recognised in the period in which the ticket is sold. Overhead recoverable income comprises charges to the producers for the use of the theatre assets and expenditure that the production would ordinarily incur during the run of the production. Overhead recoverable income is recognised in the period in which the overhead expenditure was incurred. Bar and merchandise income comprises sales of food, drink and merchandise at the theatre and are recognised at the point of sale. Theatre rental comprises charges to the producers for use of the theatre during the run of the productions and is recognised in the period in which the theatre rental took place. Restoration levy income comprises an additional charge to the theatre ticket price as a contribution to the maintenance of the theatre and is recognised at the point of sale.
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THEATRE OF COMEDY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
Assets under construction are transferred into the relevant class of asset on completion and are depreciated from the date on which they are bought into use.
Plant and machinery are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable operating in the manner intended by management. Plant and machinery is depreciated from the date on which they are bought into use. Land and buildings freehold comprise the Shaftesbury Theatre and offices. Land and buildings are initially recognised at cost. After recognition, under the revaluation model, they are carried at fair value determined with sufficient regularity so as to ensure that the carrying value does not differ materially from that which would be determined using fair value at the end of each reporting period. Such fair values are determined periodically by external valuers, and reviewed annually by the directors, and derived from the current theatre revenues per seat of the theatre, and other comparable theatres, adjusted if necessary for any differences in nature, location or condition. No depreciation is charged. Changes in fair value are recognised through other comprehensive income.
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THEATRE OF COMEDY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
At each reporting date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.
The company has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's Balance Sheet when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.
Discounting is omitted where the effect of discounting is immaterial. The company's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.
Impairment of financial assets
Financial assets are assessed for indicators of impairment at each reporting date.
Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The
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THEATRE OF COMEDY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.
If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.
Financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instruments any contract that evidences a residual interest in the assets of the company after the deduction of all its liabilities.
Basic financial liabilities, which include trade and other payables, bank loans and other loans are initially measured at their transaction price after transaction costs. When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest. Discounting is omitted where the effect of discounting is immaterial.
Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.
Trade payables are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade payables are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.
Derecognition of financial instruments
Derecognition of financial assets
Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the company transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the company will continue to recognise the value of the portion of the risks and rewards retained.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company's contractual obligations expire or are discharged or cancelled.
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THEATRE OF COMEDY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
2.Accounting policies (continued)
Interest charged on net present value discounting of financing transactions is recognised in the Statement of Comprehensive Income using the effective interest method.
Deferred tax balances are not recognised in respect of permanent differences.
Deferred balances are recognised in respect of all timing differences that have originated but not reversed by the Statement of Financial Position date, except that: - The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and - Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.
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THEATRE OF COMEDY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Revaluation of freehold property Land and buildings freehold comprise the Shaftesbury Theatre and offices. Land and buildings are initially recognised at cost. After recognition, under the revaluation model, they are carried at fair value determined with sufficient regularity so as to ensure that the carrying value does not differ materially from that which would be determined using fair value at the end of each reporting period. Such fair values are determined periodically by external valuers, and reviewed annually by the directors, and derived from the current theatre revenues per seat and the value of other comparable theatres, adjusted if necessary for any differences in nature, location or condition. No depreciation is charged. Changes in fair value are recognised through other comprehensive income. Accruals The company makes an estimate of accruals at the year end based on invoices received after the year end and work undertaken which has not been invoiced based on quotations or estimates of amounts that may be due for payment. Tangible assets Tangible 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 upon a number of factors. In re-assessing the assets' lives, factors such as technological innovation, product life cycles and maintenance programmes are taken into account. Impairment of debtors The company makes an estimate of the recoverable value of trade and other debtors. When assessing impairment, management considers factors including the current credit rating of the debtor, the ageing profile and historical experience. Effective rate of interest In determining the discounted net present value of loans provided at less than market value, in accordance with Financial Reporting Standard 102, the effective rate of interest used is the principal source of estimation uncertainty. The effective rate of interest used is based on management's judgment of a suitable market rate of interest, by reference to readily available market information for similar loans where this is an active market and other readily available information for similar loans where there is no active market.
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THEATRE OF COMEDY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Analysis of turnover by country of destination:
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THEATRE OF COMEDY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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THEATRE OF COMEDY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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THEATRE OF COMEDY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
12.Taxation (continued)
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THEATRE OF COMEDY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
The directors have taken and received advice on changes in the value of the Theatre supported by an updated valuation commissioned by the company's bankers in September 2023 in support of refinancing negotiations. The update to the valuation reflects both capital and revenue values of the theatre following the changes to the configuration of the theatre and the addition of further revenue streams. The directors consider the fair value of the theatre to be not materially different to the carrying value of freehold property and plant and machinery of £32,696,440. In forming their opinion of the fair value, the directors have considered the limited availability of West End theatres available for sale, theatre sale transactions, offers received for the theatre previously and, importantly, completed significant improvements made to the theatre to make it more attractive to theatre producers and the addition of further revenue streams and increased profitability of the theatre due to the successful current production and exciting future productions since the last formal valuation.
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THEATRE OF COMEDY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
13.Tangible fixed assets (continued)
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THEATRE OF COMEDY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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THEATRE OF COMEDY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
Bank loans are secured by a legal charge over the Shaftesbury Theatre.
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THEATRE OF COMEDY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
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THEATRE OF COMEDY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
The Company operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Company in an independently administered fund. The pension cost charge represents contributions payable by the Company to the fund and amounted to £60,875 (2022: £54,005). Contributions totalling £12,565 (2022: £7,278) were payable to the fund at the reporting date and are included in creditors.
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THEATRE OF COMEDY COMPANY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
The immediate and ultimate parent company is DLT Entertainment Limited a company registered in the United States of America.
The ultimate controlling party is D L Taffner Jnr.
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