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Registration number: 07255115

Shiva Hotels Heathrow Limited

Annual Report and Financial Statements

for the Year Ended 31 March 2023

 

Shiva Hotels Heathrow Limited

Contents

Company Information

1

Strategic Report

2 to 4

Directors' Report

5

Statement of Directors' Responsibilities

6

Independent Auditor's Report

7 to 10

Profit and Loss Account

11

Statement of Comprehensive Income

12

Balance Sheet

13

Statement of Changes in Equity

14

Statement of Cash Flows

15

Notes to the Financial Statements

16 to 29

 

Shiva Hotels Heathrow Limited

Company Information

Directors

Mr Rishi Ramesh Sachdev

Mr Uday Vyas

Registered office

Regent House, Allum Gate, Theobald Street, Elstree
Borehamwood
Hertfordshire
WD6 4RS

Auditors

MG Audit Services Limited
Chartered Accountants & Registered Auditors
166 College Road
Harrow
Middlesex
HA1 1BH

 

Shiva Hotels Heathrow Limited

Strategic Report for the Year Ended 31 March 2023

The directors present their strategic report for the year ended 31 March 2023.

Principal activity

The principal activity of the company was the operating of the Hilton Hotel, Terminal Five, Heathrow, London.

Fair review of the business


The company sold its trade and assets to a third party on 07 November 2022. Until this date the company carried out the trade of operating the Hilton Hotel at Heathrow Airport Terminal 5. The sale of the trade & assets formed part of the strategy of the business in association with the disposal of the hotel asset which is owned by the sister group company, Rising Star LLP Ltd, which was also sold to the same third party purchaser on 07 November 2022.

After the sale of the business the company has been settling its liabilities with creditors and has been provided with cash from related parties in the group in order to achieve this objective. The management are currently considering the options for the future of the company.

The company's key financial and other performance indicators during the year were as follows:

Financial KPIs

Unit

2023

2022

Turnover

£

6,449,559

7,817,330

EBITDA

£

18,819,970

(6,440,887)

Profit (loss) before tax

£

18,614,437

(6,451,726)

During the year, the impact of high-cost inflation on both variable and fixed costs, had a potential negative effect on profitability. To mitigate this, the management of the business has a strict budgetary discipline in place including the development of collaborative working relationships with key suppliers. In addition, volatile costs such as energy and utilities, are fixed or hedged wherever possible.

In addition to financial measures, during the period of operating, the Board also monitored the company's operations with the objective of ensuring that health and safety is at the core of all working practices. In measuring the success of this, the Board reviewed the level of reported incidents and monitored the training being undertaken by all relevant employees. Please note that all the employees of the company were transferred to the business of the purchaser on 07 November 2022 under the Transfer of Undertakings (Protection of Employment) Regulations 2006.

 

Shiva Hotels Heathrow Limited

Strategic Report for the Year Ended 31 March 2023

Future Prospects

The Company sold its trading business on 7 November 2022 and will rely upon financial support from it's parent companies for any remaining external creditors.

Based on the Company's forecasts and together with the financial support from the parent company, the Directors believe that the Company has access to sufficient working capital to trade in an orderly basis for the foreseeable future.

The Directors have made a full provision against the £7,354,978 debt due from Shiva Hotels Limited. As Shiva Hotels Limited is a company with common board control and management, the provision is a temporary step because the borrower is not able to evidence the exact source of repayment mechanism. However, the Directors having a detailed knowledge of the business activity of the borrower, are of the opinion that the debt will be repaid in full and as such no actual write off as a bad debt is required.

These matters indicate the existence of a material uncertainty related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern and therefore may be unable to realise their assets and discharge their liabilities in the normal course of business.
 

Principal risks and uncertainties

The management of the business and the execution of the Company's vision and strategy are subject to a number of risks. Risks facing the business are reviewed by the Board and appropriate processes are in place to identify, monitor and mitigate these risks.

The Company and its related parties constantly review financing arrangements in place to ensure that sufficient funds are in place to meet liabilities as they fall due.

Non-financial and sustainability information

Environmental matters

The Company is committed to adopting a responsible approach to environmental matters.

 

Shiva Hotels Heathrow Limited

Strategic Report for the Year Ended 31 March 2023

Company employees

Up to the point of disposal of the business, the Company employed a small number of disabled people.

The Company seeks to ensure that all employees, job applications and prospective job applicants, are afforded equality of job opportunity in all areas of employement.

The Company's Health and Safety Policy fully recongnises the Group's responsibility for health and safety of employees and members of the Community in which they work.

The Company places considerable value on the involvement of its employees and has continued its practice of keeping them informed, of matters affecting them as employees, and on various matters affectig the performance of the Company.

Approved and authorised by the Board on 10 October 2024 and signed on its behalf by:
 

.........................................
Mr Rishi Ramesh Sachdev
Director

.........................................
Mr Uday Vyas
Director

 

Shiva Hotels Heathrow Limited

Directors' Report for the Year Ended 31 March 2023

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

Directors of the company

The directors who held office during the year were as follows:

Mr Rishi Ramesh Sachdev

Mr Uday Vyas

Dividends
The Directors do not recommend the payment of a dividend (2022 - £NIL).

Disclosure of information to the auditors

Each director has taken steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditors are aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditors are unaware.

Reappointment of auditors

Pursuant to section 487 of the Companies Act 2006, The auditor will be deemed to be reappointed and MG Audit Services will therefore continue in office.

Approved and authorised by the Board on 10 October 2024 and signed on its behalf by:
 

.........................................
Mr Rishi Ramesh Sachdev
Director

.........................................
Mr Uday Vyas
Director

 

Shiva Hotels Heathrow Limited

Statement of Directors' Responsibilities

The directors acknowledge their responsibilities for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

select suitable accounting policies and apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

state whether applicable United Kingdom Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

 

Shiva Hotels Heathrow Limited

Independent Auditor's Report to the Members of Shiva Hotels Heathrow Limited

Disclaimer of Opinion

We were engaged to audit the financial statements of Shiva Hotels Heathrow Limited (the 'company') for the year ended 31 March 2023, which comprise the Profit and Loss Account, Statement of Comprehensive Income, Balance Sheet, Statement of Changes in Equity, Statement of Cash Flows, and Notes to the Financial Statements, 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 do not express an opinion on the accompanying financial statements of the company. Because of the significance of the matter described in the basis for disclaimer of opinion section of our report, we have not been able to obtained sufficient appropriate audit evidence to provide a basis for an audit opinion on the financial statements.

Basis for disclaimer of opinion on financial statements

As of the date of the audit report, the management were unable to provide us with sufficient appropriate audit evidence to support entire turnover amount of £6,449,559 and trade creditors balances of £888,631 in the financial statements. More specifically, management were unable to provide us any supporting documents for turnover due to the sale of the trade and assets of the company and the provision of underlying records being transferred to the new owner of the business. Although, at the balance sheet date trade debtors balance was nil but since we were unable to get supporting documents for turnover, we were unable to get supporting corresponding trade debtors movement. In addition, we were unable to confirm whether the obligation to pay for the trade creditor (£888,631) exists at the balance sheet date due to lack of supporting documents. Besides, management were unable to provide supporting documents for tangible assets addition during the year amount of £913,570. Furthermore, the management were unable to provide us with the corporation tax computation for the period. As a result, we were unable to confirm or verify the other tax adjustment of £3,536,743 as stated in Note 12 of the financial statements. As a result of these matters, we were unable to determine whether any adjustments might have been found necessary in respect of recorded or unrecorded turnover, trade debtors, trade creditors, corporation tax liability and tangible assets and the elements making up the statement of profit & loss account, statement of changes in equity and statement of cash flows.

Disclaimer on view given by the financial statements

Because of the possible effect to the financial statements of the above we are unable to form an opinion as to whether the financial statements:

give a true and fair view of the state of the company's affairs as at 31 March 2023 and of its profit for the year then ended;

have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

have been prepared in accordance with the requirements of the Companies Act 2006.

Opinion on other matter prescribed by the Companies Act 2006

Notwithstanding our disclaimer of an opinion on the view given by the financial statements, in our opinion, based on the work undertaken in the course of the audit:

the information given in the Strategic Report and Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

 

Shiva Hotels Heathrow Limited

Independent Auditor's Report to the Members of Shiva Hotels Heathrow Limited

the Strategic Report and Directors' Report have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

Notwithstanding our disclaimer of an opinion on the financial statements, in the light of our knowledge and understanding of the company and its environment obtained in the course of the audit performed subject to the pervasive limitation described above, we have not identified material misstatements in the Strategic Report and the Directors' Report.

Arising from the limitation of our work referred to above:

• we have not obtained all the information and explanations that we considered necessary for the purpose of our audit; and
• we were unable to determine whether adequate accounting records have been kept.
 

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

returns adequate for our audit have not been received from branches not visited by us; or

the financial statements are not in agreement with the accounting records and returns; or

certain disclosures of directors' remuneration specified by law are not made

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page 6, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditor 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.

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:

 

Shiva Hotels Heathrow Limited

Independent Auditor's Report to the Members of Shiva Hotels Heathrow Limited

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and noncompliance with laws and regulations, we considered the following:

(1) Enquiries of management, including obtaining and reviewing supporting documentation, concerning the company's policies and procedures relating to: - identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance - detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud; and - the internal controls established to mitigate risks related to fraud or non-compliance of laws and regulations; and

(2) Discussions among the engagement team regarding how and where fraud might occur in the financial statements and any potential indicators of fraud.

We also obtained an understanding of the legal and regulatory framework that the company operates in, focusing on provisions of those laws and regulations that had direct effect on the determination of material amounts and disclosures in the financial statements. The key laws and regulations we considered in this context included the UK Companies Act and FRS 102.

As a result of these procedures, we considered the particular areas that were susceptible to misstatement due to fraud were in respect of revenue recognition, complex related party transactions and management override. Our procedures to respond to risks identified included the following:

(1) reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions of relevant laws and regulations described as having a direct effect on the financial statements;

(2) enquiring of management concerning actual and potential litigation and claims;

(3) performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due to fraud;

(4) in addressing the risk of fraud through management override of controls, testing the appropriateness of any journal entries and other adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluating the rationale of any significant transactions that are unusual or outside the normal course of the company's operations.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

Use of our report

This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

 

Shiva Hotels Heathrow Limited

Independent Auditor's Report to the Members of Shiva Hotels Heathrow Limited

......................................
Mr Gavin Fernandes FCA (Senior Statutory Auditor)
For and on behalf of MG Audit Services Limited, Statutory Auditor

166 College Road
Harrow
Middlesex
HA1 1BH

14 October 2024

 

Shiva Hotels Heathrow Limited

Profit and Loss Account for the Year Ended 31 March 2023

Note

2023
£

2022
£

Turnover

3

6,449,559

7,817,330

Cost of sales

 

(3,568,253)

(4,762,547)

Gross profit

 

2,881,306

3,054,783

Administrative expenses

 

15,615,325

(9,814,934)

Other operating income

4

174,132

287,978

Operating profit/(loss)

6

18,670,763

(6,472,173)

Other interest receivable and similar income

7

134,121

22,151

Interest payable and similar expenses

8

(190,447)

(1,704)

   

(56,326)

20,447

Profit/(loss) before tax

 

18,614,437

(6,451,726)

Profit/(loss) for the financial year

 

18,614,437

(6,451,726)

The above results were derived from continuing operations.

The company has no recognised gains or losses for the year other than the results above.

 

Shiva Hotels Heathrow Limited

Statement of Comprehensive Income for the Year Ended 31 March 2023

2023
£

2022
£

Profit/(loss) for the year

18,614,437

(6,451,726)

Total comprehensive income for the year

18,614,437

(6,451,726)

 

Shiva Hotels Heathrow Limited

(Registration number: 07255115)
Balance Sheet as at 31 March 2023

Note

2023
£

2022
£

Fixed assets

 

Tangible assets

13

-

125,144

Current assets

 

Stocks

14

-

39,953

Debtors

15

74,822

1,242,526

Cash at bank and in hand

 

3,111

372,174

 

77,933

1,654,653

Creditors: Amounts falling due within one year

17

(11,623,419)

(24,392,850)

Net current liabilities

 

(11,545,486)

(22,738,197)

Total assets less current liabilities

 

(11,545,486)

(22,613,053)

Creditors: Amounts falling due after more than one year

17

-

(7,546,870)

Net liabilities

 

(11,545,486)

(30,159,923)

Capital and reserves

 

Called up share capital

50,000

50,000

Retained earnings

(11,595,486)

(30,209,923)

Shareholders' deficit

 

(11,545,486)

(30,159,923)

Approved and authorised by the Board on 10 October 2024 and signed on its behalf by:
 

.........................................
Mr Rishi Ramesh Sachdev
Director

.........................................
Mr Uday Vyas
Director

 

Shiva Hotels Heathrow Limited

Statement of Changes in Equity for the Year Ended 31 March 2023

Share capital
£

Retained earnings
£

Total
£

At 1 April 2022

50,000

(30,209,923)

(30,159,923)

Profit for the year

-

18,614,437

18,614,437

At 31 March 2023

50,000

(11,595,486)

(11,545,486)

Share capital
£

Retained earnings
£

Total
£

At 1 April 2021

50,000

(23,758,197)

(23,708,197)

Loss for the year

-

(6,451,726)

(6,451,726)

At 31 March 2022

50,000

(30,209,923)

(30,159,923)

 

Shiva Hotels Heathrow Limited

Statement of Cash Flows for the Year Ended 31 March 2023

Note

2023
£

2022
£

Cash flows from operating activities

Profit/(loss) for the year

 

18,614,437

(6,451,726)

Adjustments to cash flows from non-cash items

 

Depreciation and amortisation

6

15,086

31,286

Loss on disposal of tangible assets

5

1,023,629

-

Finance income

7

(134,121)

(22,151)

Finance costs

8

190,447

1,704

 

19,709,478

(6,440,887)

Working capital adjustments

 

Decrease/(increase) in stocks

14

39,953

(4,570)

Decrease/(increase) in trade debtors

15

1,167,704

(1,111,194)

(Decrease)/increase in trade creditors

17

(5,298,579)

3,038,662

Net cash flow from operating activities

 

15,618,556

(4,517,989)

Cash flows from investing activities

 

Interest received

7

134,121

22,151

Acquisitions of tangible assets

(913,570)

(19,869)

Net cash flows from investing activities

 

(779,449)

2,282

Cash flows from financing activities

 

Interest paid

8

(190,447)

(1,704)

(Decrease) increase in loan due to related parties

 

(15,017,723)

4,867,361

(Increase) decrease in loan due from related parties

-

(4,420)

Net cash flows from financing activities

 

(15,208,170)

4,861,237

Net (decrease)/increase in cash and cash equivalents

 

(369,063)

345,530

Cash and cash equivalents at the beginning of the year

 

372,174

26,644

Cash and cash equivalents at the end of the year

 

3,111

372,174

 

Shiva Hotels Heathrow Limited

Notes to the Financial Statements for the Year Ended 31 March 2023

1

General information

The company is a private company limited by share capital, incorporated in United Kingdom.

The address of its registered office is:
Regent House, Allum Gate, Theobald Street, Elstree
Borehamwood
Hertfordshire
WD6 4RS
England

These financial statements were authorised for issue by the Board on 10 October 2024.

2

Accounting policies

Summary of significant accounting policies and key accounting estimates

The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

Statement of compliance

These financial statements were prepared in accordance with Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland and the Companies Act 2006'.

Basis of preparation

These financial statements have been prepared using the historical cost convention except that as disclosed in the accounting policies certain items are shown at fair value.

The presentation currency of these financial statements is sterling.

Going concern

The financial statements have been prepared on a going concern basis, which notwithstanding net current liabilities of £11,545,486 (2022: £22,738,197), the Directors believe to be appropriate for the following reasons.

The Company sold its trading business on 7 November 2022 and will rely upon financial support from its parent companies for any remaining external creditors. Based on the Company's forecasts and together with the financial support from the parent company, the Directors believe that the Company has access to sufficient working capital to trade in an orderly basis for the foreseeable future.

Taking these circumstances into account, the Directors consider that the Company will be able to continue in operational existence for the foreseeable future by meeting its liabilities as they fall due for payment. However, these matters indicate the existence of a material uncertainty on the Company's ability to continue as a going concern.

 

Shiva Hotels Heathrow Limited

Notes to the Financial Statements for the Year Ended 31 March 2023

Judgements

The preparation of the financial statements requires the Company to make estimates and assumptions that affect the application of policies and reported amounts. Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are considered to be reasonable under the circumstances. Actual results may differ from these estimates.

Recoverability of amounts due from related parties:

The company has significant amounts due from related parties. The directors assess the ability of the other party to settle the balance at the balance sheet date to ensure recoverability.
 

Revenue recognition

Turnover comprises the fair value of the consideration received or receivable for the sale of goods and provision of services in the ordinary course of the company’s activities. Turnover is shown net of sales/value added tax, returns, rebates and discounts.

The company recognises revenue when:
The amount of revenue can be reliably measured;
it is probable that future economic benefits will flow to the entity;
and specific criteria have been met for each of the company's activities.

Foreign currency transactions and balances

Transactions in foreign currencies are translated to the Company's functional currency at the foreign exchange rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are retranslated to the functional currency at the foreign exchange rate ruling at that date.

Tax

Tax on the profit or loss for the year comprises current and deferred tax. Tax is recognised in the profit and loss account except to the extent that it relates to items recognised directly in equity or other comprehensive income, in which case it is recognised directly in equity or other comprehensive income.

Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates enacted or substantively enacted at the balance sheet date, and any adjustment to tax payable in respect of previous years.

Deferred tax is provided on timing differences which arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in the financial statements. The following timing differences are not provided for: differences between accumulated depreciation and tax allowances for the cost of a fixed asset if and when all conditions for retaining the tax allowances have been met. Deferred tax is not recognised on permanent differences arising because certain types of income or expense are non-taxable or are disallowable for tax or because certain tax charges or allowances are greater or smaller than the corresponding income or expense.
Deferred tax is measured at the tax rate that is expected to apply to the reversal of the related difference, using tax rates enacted or substantively enacted at the balance sheet date. Deferred tax balances are not discounted.

 

Shiva Hotels Heathrow Limited

Notes to the Financial Statements for the Year Ended 31 March 2023

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that is it probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Tangible assets

Tangible assets are stated in the balance sheet at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.

The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.

Depreciation

Depreciation is charged so as to write off the cost of assets, other than land and properties under construction over their estimated useful lives, as follows:

Depreciation methods, useful lives and residual values are reviewed if there is an indication of a significant change since last annual reporting date in the pattern by which the company expects to consume an asset's future economic benefits.

Asset class

Depreciation method and rate

Furniture, fittings and equipment

Straight Line method 20%

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.

Trade debtors

Trade debtors are amounts due from customers for merchandise sold or services performed in the ordinary course of business.

Trade debtors are recognised initially at the transaction price. They are subsequently measured at amortised cost using the effective interest method, less provision for impairment. A provision for the impairment of trade debtors is established when there is objective evidence that the company will not be able to collect all amounts due according to the original terms of the receivables.

Stocks

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost is determined using the first-in, first-out (FIFO) method.

The cost of finished goods and work in progress comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the inventories to their present location and condition. At each reporting date, stocks are assessed for impairment. If stocks are 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.

 

Shiva Hotels Heathrow Limited

Notes to the Financial Statements for the Year Ended 31 March 2023

Trade creditors

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the company does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.

Trade creditors are recognised initially at the transaction price and subsequently measured at amortised cost using the effective interest method.

Interest Payable

Interest payable is recognised in profit or loss as it accrues, using the effective interest method.

Leases


Operating Lease

Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease unless the payments to the lessor are structured to increase in line with expected general inflation; in which case the payments related to the structured increases are recognised as incurred. Lease incentives received are recognised in profit and loss over the term of the lease as an integral part of the total lease expense.

Finance Lease

Minimum lease payments are apportioned between the finance charge and the reduction of the outstanding liability using the rate implicit in the lease. The finance charge is allocated to each period during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the lability. Contingent rents are charged as expenses in the periods in which they are incurred.

Share capital

Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.

 

Shiva Hotels Heathrow Limited

Notes to the Financial Statements for the Year Ended 31 March 2023

Financial instruments

Classification
In accordance with FRS 102, financial instruments issued by the Company are treated as equity only to the extent that they meet the following two conditions:

(a) they include no contractual obligations upon the company to deliver cash or other financial assets or to exchange financial assets or financial liabilities with another party under conditions that are potentially unfavourable to the company; and
(b) where the instrument will or may be settled in the company's own equity instruments, it is either a non-derivative that includes no obligation to deliver a variable number of the company's own equity instruments or is a derivative that will be settled by the company's exchanging a fixed amount of cash or other financial assets for a fixed number of its own equity instruments.

To the extent that this definition is not met, the proceeds of issue are classified as a financial liability. Where the instrument so classified takes the legal form of the company's own shares, the amounts presented in these financial statements for called up share capital and share premium account exclude amounts in relation to those shares.

 Recognition and measurement
Trade and other debtors/creditors:

Trade and other debtors are recognised initially at transaction price less attributable transaction costs. Trade and other creditors are recognised initially at transaction price plus attributable transaction costs. Subsequent to initial recognition they are measured at amortised cost using the effective interest method, less any impairment losses in the case of trade debtors. If the arrangement constitutes a financing transaction, for example if payment is deferred beyond normal business terms, then it is measured at the present value of future payments discounted at a market rate of instrument for a similar debt instrument.

Interest-bearing borrowings classified as basic financial instruments:

Interest-bearing borrowings are recognised initially at the present value of future payments discounted at a market rate of interest. Subsequent to initial recognition, interest-bearing borrowings are stated at amortised cost using the effective interest method, less any impairment losses.

 Impairment
An impairment loss in respect of a financial asset measured at amortised cost is calculated as the difference between its carrying amount and the present value of the estimated future cashflows discounted at the asset's original effective interest rate. For financial instruments measured at cost less impairment an impairment is calculated as the difference between its carrying amount and the best estimate of the amount that the Company would receive for the asset if it were to be sold at the reporting date. Interest on the impaired asset continues to be recognised through the unwinding of the discount. Impairment losses are recognised in profit or loss. When a subsequent event causes the amount of impairment loss to decrease, the decrease in impairment loss is reversed through profit or loss.

 

Shiva Hotels Heathrow Limited

Notes to the Financial Statements for the Year Ended 31 March 2023

The carrying amounts of the Company's non-financial assets, other than stocks and deferred tax assets, are reviewed at each reporting date to determine whether there is any indication of impairment. if any such indication exists, then the asset's recoverable amount is estimated. The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less costs to sell. 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.

An impairment loss is recognised if the carrying amount of an asset exceeds its estimated recoverable amount, Impairment losses are recognised in profit or loss.

An impairment loss is reversed if and only if the reasons for the impairment have ceased to apply.

Impairment losses recognised in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed only to the extent that the asset's carrying amount does not exceed the carrying amount that would have been determined, net of. depreciation or amortisation, if no impairment loss had been recognised.

Defined contribution pension obligation

A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the company has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.

Contributions to defined contribution plans are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.

 

Shiva Hotels Heathrow Limited

Notes to the Financial Statements for the Year Ended 31 March 2023

3

Turnover

The analysis of the company's revenue for the year from continuing operations is as follows:

2023
 £

2022
 £

Rendering of services

6,449,559

7,817,330

4

Other operating income

The analysis of the company's other operating income for the year is as follows:

2023
 £

2022
 £

Government grants

-

287,978

Other income

174,132

-

174,132

287,978

5

Other gains and losses

The analysis of the company's other gains and losses for the year is as follows:

2023
 £

2022
 £

Gain/loss on disposal of property, plant and equipment

(1,023,629)

-

6

Operating profit/(loss)

Arrived at after charging/(crediting)

2023
 £

2022
 £

Depreciation expense

15,086

31,286

Operating lease expense - property

(23,286,237)

4,594,002

Loss on disposal of property, plant and equipment

1,023,629

-

7

Other interest receivable and similar income

2023
 £

2022
 £

Other finance income

134,121

22,151

8

Interest payable and similar expenses

2023
 £

2022
 £

Interest on obligations under finance leases and hire purchase contracts

50,056

1,704

Interest expense on other finance liabilities

140,391

-

190,447

1,704

 

Shiva Hotels Heathrow Limited

Notes to the Financial Statements for the Year Ended 31 March 2023

9

Staff costs

The aggregate payroll costs (including directors' remuneration) were as follows:

2023
 £

2022
 £

Wages and salaries

1,686,188

2,077,095

Social security costs

109,934

174,081

Pension costs, defined contribution scheme

26,582

46,957

1,822,704

2,298,133

The average number of persons employed by the company (including directors) during the year, analysed by category was as follows:

2023
No.

2022
No.

Hotel manager

1

1

Hotel staff

51

73

52

74

10

Directors' remuneration

Directors' emoluments have been borne by a related company. The directors of the company are also directors or officers of a number of related parties of the company. The directors' services to the company do not occupy a significant amount of their time. As such the directors do not consider that they have received any remuneration for their incidental services to the company for the years ended 31 March 2023 or 31 March 2022.

11

Auditors' remuneration

2023
 £

2022
 £

Audit of the financial statements

(33,015)

15,000


 

Brought forward accrued auditor remuneration of £58,400 (2022: £nil) was reversed during the year.

 

Shiva Hotels Heathrow Limited

Notes to the Financial Statements for the Year Ended 31 March 2023

12

Taxation

Tax charged/(credited) in the profit and loss account

2023
£

2022
£

The tax on profit before tax for the year is the same as the standard rate of corporation tax in the UK (2022 - the same as the standard rate of corporation tax in the UK) of 19% (2022: 19%).

The differences are reconciled below:

2023
£

2022
£

Profit/(loss) before tax

18,614,437

(6,451,726)

Corporation tax at standard rate

3,536,743

(1,225,828)

Decrease from effect of different UK tax rates on some earnings

-

(194,050)

Effect of tax losses

-

1,461,664

Tax decrease from effect of capital allowances and depreciation

-

(34,385)

Tax decrease from other short-term timing differences

-

(9,839)

Other tax adjustment

(3,536,743)

-

Other tax effects for reconciliation between accounting profit and tax expense (income)

-

2,438

Total tax charge/(credit)

-

-

 

Shiva Hotels Heathrow Limited

Notes to the Financial Statements for the Year Ended 31 March 2023

13

Tangible assets

Furniture, fittings and equipment
 £

Total
£

Cost or valuation

At 1 April 2022

5,000,627

5,000,627

Additions

913,570

913,570

Disposals

(5,914,197)

(5,914,197)

At 31 March 2023

-

-

Depreciation

At 1 April 2022

4,875,483

4,875,483

Charge for the year

15,086

15,086

Eliminated on disposal

(4,890,569)

(4,890,569)

At 31 March 2023

-

-

Carrying amount

At 31 March 2023

-

-

At 31 March 2022

125,144

125,144

14

Stocks

2023
 £

2022
 £

Raw materials and consumables

-

39,953

15

Debtors

Current

Note

2023
£

2022
£

Trade debtors

 

-

155,553

Amounts owed by related parties

23

5,485

5,461

Other debtors

 

69,337

60,872

Prepayments

 

-

1,020,640

   

74,822

1,242,526

 

Shiva Hotels Heathrow Limited

Notes to the Financial Statements for the Year Ended 31 March 2023

16

Cash and cash equivalents

2023
 £

2022
 £

Cash on hand

-

1,500

Cash at bank

3,111

370,674

Cash and cash equivalents in statement of cash flows

3,111

372,174

17

Creditors

Note

2023
 £

2022
 £

Due within one year

 

Trade creditors

 

888,631

4,340,442

Amounts due to related parties

23

10,362,652

17,833,504

Social security and other taxes

 

335,280

1,191,287

Outstanding defined contribution pension costs

 

-

8,144

Other payables

 

21,856

2,525

Accrued expenses

 

15,000

1,016,948

 

11,623,419

24,392,850

Due after one year

 

Other non-current financial liabilities

 

-

7,546,870

18

Pension and other schemes

Defined contribution pension scheme

The company operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the company to the scheme and amounted to £26,582 (2022 - £46,957).

Contributions totalling £Nil (2022 - £8,144) were payable to the scheme at the end of the year and are included in creditors.

 

Shiva Hotels Heathrow Limited

Notes to the Financial Statements for the Year Ended 31 March 2023

19

Share capital

Allotted, called up and fully paid shares

2023

2022

No.

£

No.

£

Ordinary Shares of £1 each

50,000

50,000

50,000

50,000

       

20

Obligations under leases and hire purchase contracts

Operating leases

The total of future minimum lease payments is as follows:

2023
£

2022
£

Not later than one year

-

5,123,626

Later than one year and not later than five years

-

20,494,504

Later than five years

-

48,274,383

-

73,892,513

The Company cancelled the operating lease during the year. The amount of operating lease payments recognised as an expense during the year was £nil (2022 - £4,351,676).

21

Contingent liabilities

Fixed and floating charges over certain assets and contracts held by company and the related amounts payable to Rising Star LLP Limited have been entered into as security against the borrowings of a related party, Rising Star LLP Limited, with Longbow Investment No. 3 SARL and LGIM Commercial Lending Limited.

22

Analysis of changes in net debt

At 1 April 2022
£

Cash flows of the entity
£

At 31 March 2023
£

Cash and cash equivalents

Cash

372,174

(369,063)

3,111

 

372,174

(369,063)

3,111

 

Shiva Hotels Heathrow Limited

Notes to the Financial Statements for the Year Ended 31 March 2023

23

Related party transactions

The indentity of related parties with which the company has transacted is shown below.

The related parties noted below are all considered to be under the control of the ultimate controlling party.

Loans to related parties

 

2023
£

2022
 £

Kailash Hotels Heathrow Ltd

168

159

Kailash Hotels Gatwick LP

303

287

Shiva Kingsway Limited

5,014

5,014

5,485

5,460

Loans from related parties

 

2023
£

2022
 £

Rising Star LLP Ltd

-

(22,969,620)

Kailash Hotels Heathrow Jersey LP

(2,468,620)

(2,410,755)

Kailas Hotels Holdings Ltd

(7,894,032)

-

(10,362,652)

(25,380,375)

Funds provided or (repaid/advanced)

2023
£

2022
 £

Kailash Hotels Heathrow Jersey LP

57,865

254,414

Rising Star LLP Ltd

(22,969,620)

4,612,949

Kailas Hotels Holdings Ltd

7,894,032

-

Kailas Hotel Heathrow Ltd

(9)

-

Kailas Hotel Gatwick LP

(16)

-

(15,017,748)

4,867,363

24

Financial instruments

Categorisation of financial instruments

2023
 £

2022
 £

Financial assets that are debt instruments measured at amortised cost

77,933

594,060

Financial liabilities measured at amortised cost

11,288,139

30,748,433

 

Shiva Hotels Heathrow Limited

Notes to the Financial Statements for the Year Ended 31 March 2023

25

Parent and ultimate parent undertaking

The company's immediate parent is Kailas Hotel Heathrow Jersey LP, incorporated in Jersey.

 The ultimate parent is Abbey Care Homes Limited, incorporated in Jersey.