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Registered number: 07613798









SUTTON COLDFIELD HOTEL LIMITED









ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2023

 
SUTTON COLDFIELD HOTEL LIMITED
 
 
COMPANY INFORMATION


Directors
Balkar S Johal 
Balraj S Johal 
Jasbir S Johal 
Iqbal S Johal 
Sarnpal S Johal 




Company secretary
Iqbal S Johal



Registered number
07613798



Registered office
80-90 Holyhead Road

Coventry

CV1 3AS




Independent auditors
Adler Shine LLP
Chartered Accountants & Statutory Auditor

Aston House

Cornwall Avenue

London

N3 1LF





 
SUTTON COLDFIELD HOTEL LIMITED
 

CONTENTS



Page
Strategic Report
1
Directors' Report
2 - 3
Independent Auditors' Report
4 - 7
Statement of Comprehensive Income
8
Balance Sheet
9 - 10
Statement of Changes in Equity
11
Notes to the Financial Statements
12 - 26


 
SUTTON COLDFIELD HOTEL LIMITED
 
 
STRATEGIC REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

Introduction
 
The principal activity of the company is the operation of a hotel. 

Business review
 
The company plans to continue to provide asylum accommodation services and expects to continue to see demand grow in the coming years as there is still significant demand to accommodate asylum seekers on a short term basis. 

Principal risks and uncertainties
 
Liquidity risk
The company is undergoing a period of growing profits. The funds have been invested in reducing a significant amount of the company debt, meaning liquidity risk has diminished significantly. 
Employee turnover 
The success of the business is partly dependent on key members of staff and failure to retain key personnel could impact the quality of service. The company limits this risk by implementing appropriate performance management rewards and incentives, and through offering comprehensive training programmes.
Competition risk
Maintaining strong relationships with the government contract provider, whilst maintaining the quality of service has mitigated the risk of competitive bids who may look to undercut the current agreed rates, whilst reducing the company’s debts ensures it is prepared for all new ventures and opportunities as they arise. 

Financial key performance indicators
 
The directors are of the opinion that the financial key performance indicators for assessing the company are turnover, gross margin (GM) and operating margin (OM).
Turnover: £9,757k (2022: £9,350k)
GM 79.6% (2022: 83.1%)
OM: 65.2% (2022: 72%)
As set out in the business review above, the hotel is operating with strong and reliable revenue but must ensure vigilant cost controls, which are reflected in the financial KPIs. Considering this, the directors are satisfied with the results and KPIs for the year under review.

Other key performance indicators
 
The directors are of the opinion that other key performance indicators for assessing the company are customer satisfaction levels.


This report was approved by the board and signed on its behalf.



................................................
Jasbir S Johal
Director

Date: 10 October 2024

Page 1

 
SUTTON COLDFIELD HOTEL 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.

Directors' responsibilities statement

The directors are responsible for preparing the Strategic Report, the Directors' Report and the financial statements in accordance with applicable law and regulations.
 
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 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 2006They 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.

Results and dividends

The profit for the year, after taxation, amounted to £4,583,509 (2022 - £4,901,239).

Dividends for the year amounted to £nil (2022 restated - £2,500,000).

Directors

The directors who served during the year were:

Balkar S Johal 
Balraj S Johal 
Jasbir S Johal 
Iqbal S Johal 
Sarnpal S Johal 

Future developments

The Directors are not aware, at the date of this report, of any likely major changes in the Company's future activities.

Page 2

 
SUTTON COLDFIELD HOTEL LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023

Disclosure of information to auditors

Each of the persons who are directors at the time when this Directors' Report is approved has confirmed that:
 
so far as the director is aware, there is no relevant audit information of which the Company's auditors are unaware, and

the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the Company's auditors are aware of that information.

Post balance sheet events

There have been no significant events affecting the Company since the year end.

Auditors

The auditorsAdler Shine LLPwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

This report was approved by the board and signed on its behalf.
 





................................................
Jasbir S Johal
Director

Date: 10 October 2024

Page 3

 
SUTTON COLDFIELD HOTEL LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SUTTON COLDFIELD HOTEL LIMITED
 

Opinion


We have audited the financial statements of Sutton Coldfield Hotel Limited (the 'Company') for the year ended 31 December 2023, which comprise the Statement of Comprehensive Income, the Balance Sheet, the Statement of Changes in Equity and the related notes, including a summary of significant accounting policiesThe 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).


In our opinion the financial statements:


give a true and fair view of the state of the Company's affairs as at 31 December 2023 and of its 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.


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 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.


Conclusions relating to going concern


In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.


Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.


Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.


Page 4

 
SUTTON COLDFIELD HOTEL LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SUTTON COLDFIELD HOTEL LIMITED (CONTINUED)


Other information


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 ReportOur 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.


Opinion on other matters prescribed by the Companies Act 2006
 

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.


Matters on which we are required to report by exception
 

In the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or the Directors' Report.


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


adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of directors' remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.


Responsibilities of directors
 

As explained more fully in the Directors' Responsibilities Statement set out on page 2, 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.


Page 5

 
SUTTON COLDFIELD HOTEL LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SUTTON COLDFIELD HOTEL LIMITED (CONTINUED)


Auditors' 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 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 identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and then design and perform audit procedures responsive to those risks, including obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion. 
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, we have:
• considered the nature of the industry and sectors, control environment and business performance;
• made enquires of management about their own identification and assessment of the risk of irregularities; 
• performed audit work over the risk of management override of controls, including testing of journal entries  and other adjustments for appropriateness and reviewing accounting estimates for bias;
• reviewed minutes of meetings;
• undertaken appropriate sample based testing of bank transactions;
• identified and evaluated compliance with relevant laws and regulations and made enquiries of any    instances of non-compliance; The key laws and regulations we considered in this context included UK    Companies Act, data protection, anti bribery, employment law, health and safety and Money Laundering    Act.
• discussed matters among the audit engagement team regarding how and where fraud might occur in the   financial statements and potential indicators of fraud.


Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.


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.


Page 6

 
SUTTON COLDFIELD HOTEL LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SUTTON COLDFIELD HOTEL LIMITED (CONTINUED)


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 2006Our 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.





Engin Zekia Bsc FCA (Senior Statutory Auditor)
  
for and on behalf of
Adler Shine LLP
 
Chartered Accountants
Statutory Auditor
  
Aston House
Cornwall Avenue
London
N3 1LF

10 October 2024
Page 7

 
SUTTON COLDFIELD HOTEL LIMITED
 
 
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
Note
£
£

  

Turnover
 4 
9,756,593
9,349,454

Cost of sales
  
(2,008,147)
(1,577,621)

Gross profit
  
7,748,446
7,771,833

Administrative expenses
  
(1,419,562)
(1,039,804)

Operating profit
  
6,328,884
6,732,029

Amounts written off investments
  
-
(582,416)

Interest payable and similar expenses
 8 
(85,062)
(1,054)

Profit before tax
  
6,243,822
6,148,559

Tax on profit
 9 
(1,660,313)
(1,247,320)

Profit for the financial year
  
4,583,509
4,901,239

Other comprehensive income for the year
  

Total comprehensive income for the year
  
4,583,509
4,901,239

There were no recognised gains and losses for 2023 or 2022 other than those included in the statement of comprehensive income.

The notes on pages 12 to 26 form part of these financial statements.

Page 8

 
SUTTON COLDFIELD HOTEL LIMITED
REGISTERED NUMBER: 07613798

BALANCE SHEET
AS AT 31 DECEMBER 2023

2023
2022 
(as restated)
Note
£
£

Fixed assets
  

Tangible assets
 11 
8,148,009
8,156,826

  
8,148,009
8,156,826

Current assets
  

Stocks
 12 
15,170
16,971

Debtors: amounts falling due within one year
 13 
10,830,694
5,576,566

Cash at bank and in hand
 14 
2,953,016
883,300

  
13,798,880
6,476,837

Creditors: amounts falling due within one year
 15 
(9,562,970)
(6,973,117)

Net current assets/(liabilities)
  
 
 
4,235,910
 
 
(496,280)

Total assets less current liabilities
  
12,383,919
7,660,546

Creditors: amounts falling due after more than one year
 16 
-
(28,354)

Provisions for liabilities
  

Deferred tax
 18 
(700,908)
(532,690)

  
 
 
(700,908)
 
 
(532,690)

Net assets
  
11,683,011
7,099,502


Capital and reserves
  

Called up share capital 
 19 
2
2

Revaluation reserve
  
2,102,723
2,270,941

Profit and loss account
  
9,580,286
4,828,559

  
11,683,011
7,099,502


Page 9

 
SUTTON COLDFIELD HOTEL LIMITED
REGISTERED NUMBER: 07613798
    
BALANCE SHEET (CONTINUED)
AS AT 31 DECEMBER 2023

The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 




................................................
Jasbir S Johal
Director

Date: 10 October 2024

The notes on pages 12 to 26 form part of these financial statements.

Page 10

 
SUTTON COLDFIELD HOTEL LIMITED
 

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023


Called up share capital
Revaluation reserve
Profit and loss account
Total equity

£
£
£
£


At 1 January 2022 (as restated)
2
2,270,941
2,427,320
4,698,263


Comprehensive income for the year

Profit for the year
-
-
4,901,239
4,901,239


Contributions by and distributions to owners

Dividends: Equity capital (as restated)
-
-
(2,500,000)
(2,500,000)



At 1 January 2023 (as restated)
2
2,270,941
4,828,559
7,099,502


Comprehensive income for the year

Profit for the year
-
-
4,583,509
4,583,509

Transfer to/from profit and loss account
-
(168,218)
168,218
-


At 31 December 2023
2
2,102,723
9,580,286
11,683,011


The notes on pages 12 to 26 form part of these financial statements.

Page 11

 
SUTTON COLDFIELD HOTEL LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

1.


General information

Sutton Coldfield Hotel Limited is a private company limited by shares. The company is incorporated in England and Wales and the address of its registered office is 80-90 Holyhead Road, Coventry, CV1 3AS. 

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK 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 following principal accounting policies have been applied:

 
2.2

Financial Reporting Standard 102 - reduced disclosure exemptions

The Company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
the requirements of Section 7 Statement of Cash Flows;
the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
the requirements of Section 11 Financial Instruments paragraphs 11.42, 11.44 to 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);
the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.27, 12.29(a), 12.29(b) and 12.29A;
the requirements of Section 33 Related Party Disclosures paragraph 33.7.

This information is included in the consolidated financial statements of Savera Group UK Limited as at 31 December 2023 and these financial statements may be obtained from Companies House.

 
2.3

Going concern

Having reviewed the company's financial forecasts and expected cash flows, the directors have a reasonable expectation that the company had adequate resources to continue in operational existence for the foreseeable future. Thus, the going concern basis has been adopted in preparing the financial statements for the year ended 31 December 2023.

Page 12

 
SUTTON COLDFIELD HOTEL LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.4

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:

Rendering of services

Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
the amount of revenue can be measured reliably;
it is probable that the Company will receive the consideration due under the contract;
the stage of completion of the contract at the end of the reporting period can be measured reliably; and
the costs incurred and the costs to complete the contract can be measured reliably.

 
2.5

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

 
2.6

Borrowing costs

All borrowing costs are recognised in profit or loss in the year in which they are incurred.

 
2.7

Pensions

Defined contribution pension plan

The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.

The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Balance Sheet. The assets of the plan are held separately from the Company in independently administered funds.

Page 13

 
SUTTON COLDFIELD HOTEL LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.8

Current and deferred taxation

The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the Company operates and generates income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet 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.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

 
2.9

Tangible fixed assets

Tangible fixed assets under the cost model 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 of operating in the manner intended by management.

At each reporting date the Company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.

Land is not depreciated. Depreciation on other assets is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, on a reducing balance basis.

Depreciation is provided on the following basis:

Freehold property
-
carried at valuation
Fixtures and fittings
-
25%
reducing balance

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.

Page 14

 
SUTTON COLDFIELD HOTEL LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.10

Revaluation of tangible fixed assets

Individual freehold and leasehold properties are carried at current year value at fair value at the date of the revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses. Revaluations are undertaken with sufficient regularity to ensure the carrying amount does not differ materially from that which would be determined using fair value at the balance sheet date.
Fair values are determined from market based evidence normally undertaken by professionally qualified valuers.

Revaluation gains and losses are recognised in other comprehensive income unless losses exceed the previously recognised gains or reflect a clear consumption of economic benefits, in which case the excess losses are recognised in profit or loss.

 
2.11

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. Work in progress and finished goods include labour and attributable overheads.

At each balance sheet 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.

 
2.12

Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

 
2.13

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

 
2.14

Creditors

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

Page 15

 
SUTTON COLDFIELD HOTEL LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.15

Provisions for liabilities

Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
 
Increases in provisions are generally charged as an expense to profit or loss.

 
2.16

Financial instruments

The Company has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.

The Company has elected to apply the recognition and measurement provisions of IFRS 9 Financial Instruments (as adopted by the UK Endorsement Board) with the disclosure requirements of Sections 11 and 12 and the other presentation requirements of FRS 102.

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.

Other financial assets

Other financial assets, which includes investments in equity instruments which are not classified as subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the recognised transaction price. Such assets are subsequently measured at fair value with the changes in fair value being recognised in the profit or loss. Where other financial assets are not publicly traded, hence their fair value cannot be measured reliably, they are measured at cost less impairment.

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
Page 16

 
SUTTON COLDFIELD HOTEL LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)


2.16
Financial instruments (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.

Other financial instruments

Derivatives, including forward exchange contracts, futures contracts and interest rate swaps, are not classified as basic financial instruments. These are initially recognised at fair value on the date the derivative contract is entered into, with costs being charged to the profit or loss. They are subsequently measured at fair value with changes in the profit or loss.

Debt instruments that do not meet the conditions as set out in FRS 102 paragraph 11.9 are subsequently measured at fair value through the profit or loss. This recognition and measurement would also apply to financial instruments where the performance is evaluated on a fair value basis as with a documented risk management or investment strategy.

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.

Page 17

 
SUTTON COLDFIELD HOTEL LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)


2.16
Financial instruments (continued)

Derecognition of financial liabilities

Financial liabilities are derecognised when the Company's contractual obligations expire or are discharged or cancelled.

 
2.17

Dividends

Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting.


3.


Judgments in applying accounting policies and key sources of estimation uncertainty

In the application of the Company's accounting policies, set out in note 2 above, the Directors are required to make judgements, estimates and assumptions about the carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experiences and other factors that are considered 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, if the revision affects only that period, or in the period of the revision and future periods, if the revision affects both curent and future periods.
The key assumptions and other key sources of uncertainty that have a significant effect of the amounts recognised in the financial statements are described below:
Tangible fixed assets
Judgements have been made in relation to the lives of tangible fixed assets, in particular the valuation, the useful economic life and residual value of assets. The Directors are also required to consider the carrying value of assets and whether any impairment is required.
The Directors have concluded that the asset values and residual values are appropriate and are satisfied that assets are fairly stated at the balance sheet date.
Stocks
Key judgements are made by management in estimating the level of provisioning required for slow moving stocks. In arriving at their conclusion, the Directors consider stock ageing and stock turn analysis.
The Directors have concluded that the stock values are fairly stated at the balance sheet date.
Recoverability of debtors
Judgements have been made in relation to the recoverability of debtors. The Directors asses and consider the probability of recovery of debts and, where there is any doubt over the recoverability of debtors, the level of provision required.
The Directors have concluded that the carrying amount of debtors, net of provisions, are appropriate and are satisfied that debtors stated at the balance sheet date are considered recoverable.

Page 18

 
SUTTON COLDFIELD HOTEL LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

4.


Turnover

An analysis of turnover by class of business is as follows:


2023
2022
£
£

Hotel accommodation
9,756,593
9,349,454

9,756,593
9,349,454


All turnover arose within the United Kingdom.


5.


Auditors' remuneration

During the year, the Company obtained the following services from the Company's auditors:


2023
2022
£
£

Fees payable to the Company's auditors for the audit of the Company's financial statements
20,000
15,000


6.


Employees

Staff costs, including directors' remuneration, were as follows:


2023
2022
£
£



Wages and salaries
1,222,664
1,095,264

National Insurance
101,790
140,467

Defined contribution scheme
11,454
12,913

1,335,908
1,248,644




The average monthly number of employees, including the directors, during the year was as follows:


        2023
        2022
            No.
            No.







Employees & Directors
50
58

Page 19

 
SUTTON COLDFIELD HOTEL LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

7.


Directors' remuneration

2023
2022
£
£

Directors' emoluments
397,500
293,750

397,500
293,750



8.


Interest payable and similar expenses

2023
2022
£
£


Bank interest payable
382
1,054

Other interest - on overdue tax
84,680
-

85,062
1,054


9.


Taxation


2023
2022
£
£

Corporation tax


Current tax on profits for the year
1,492,095
1,253,335


1,492,095
1,253,335


Total current tax
1,492,095
1,253,335

Deferred tax


Changes to tax rates
168,218
(6,015)

Total deferred tax
168,218
(6,015)


Tax on profit
1,660,313
1,247,320
Page 20

 
SUTTON COLDFIELD HOTEL LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
 
9.Taxation (continued)


Factors affecting tax charge for the year

The tax assessed for the year is higher than (2022 - higher than) the standard rate of corporation tax in the UK of 25% (2022 - 19%). The differences are explained below:

2023
2022
£
£


Profit on ordinary activities before tax
6,243,822
6,148,559


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25%/19% (2022 - 19%)
1,468,578
1,168,226

Effects of:


Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
27,441
110,659

Capital allowances for year in excess of depreciation
(2,597)
5,208

Increase or decrease in pension fund prepayment leading to an increase (decrease) in tax
50
(39)

Other timing differences leading to an increase (decrease) in deferred taxation
168,218
-

Changes in provisions leading to an increase (decrease) in the tax charge
-
(6,015)

Group relief
(1,377)
(30,719)

Total tax charge for the year
1,660,313
1,247,320


Factors that may affect future tax charges

There were no factors that may affect future tax charges.




10.


Dividends

2023
2022 
(as restated)
£
£


Dividends paid
-
2,500,000

-
2,500,000

Page 21

 
SUTTON COLDFIELD HOTEL LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

11.


Tangible fixed assets





Freehold property
Fixtures and fittings
Total

£
£
£



Cost or valuation


At 1 January 2023
8,000,000
771,849
8,771,849


Additions
-
35,851
35,851



At 31 December 2023

8,000,000
807,700
8,807,700



Depreciation


At 1 January 2023
-
615,023
615,023


Charge for the year on owned assets
-
44,668
44,668



At 31 December 2023

-
659,691
659,691



Net book value



At 31 December 2023
8,000,000
148,009
8,148,009



At 31 December 2022
8,000,000
156,826
8,156,826

The historic cost of the freehold property is £5,196,369 (2022: £5,196,369). 


12.


Stocks

2023
2022
£
£

Finished goods and goods for resale
15,170
16,971



13.


Debtors

2023
2022
£
£


Other debtors
10,681,142
5,320,380

Prepayments and accrued income
149,552
256,186

10,830,694
5,576,566


Page 22

 
SUTTON COLDFIELD HOTEL LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

14.


Cash and cash equivalents

2023
2022
£
£

Cash at bank and in hand
2,953,016
883,300



15.


Creditors: Amounts falling due within one year

2023
2022
£
£

Bank loans
-
9,807

Trade creditors
323,836
302,290

Amounts owed to group undertakings
7,225,479
4,423,964

Corporation tax
1,492,096
1,532,939

Other taxation and social security
333,170
397,173

Other creditors
8,517
245,773

Accruals and deferred income
179,872
61,171

9,562,970
6,973,117



16.


Creditors: Amounts falling due after more than one year

2023
2022
£
£

Bank loans
-
28,354


Page 23

 
SUTTON COLDFIELD HOTEL LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

17.


Loans


Analysis of the maturity of loans is given below:


2023
2022
£
£

Amounts falling due within one year

Bank loans
-
9,807

Amounts falling due 1-2 years

Bank loans
-
10,052

Amounts falling due 2-5 years

Bank loans
-
18,302


-
38,161


The company is party to a cross-collateral guarantee under which borrowings of the group are secured by way of fixed and floating charges over the company's assets.

Page 24

 
SUTTON COLDFIELD HOTEL LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

18.


Deferred taxation




2023 
(as restated)


£






At beginning of year
(532,690)


Charged to profit or loss
(168,218)



At end of year
(700,908)

The provision for deferred taxation is made up as follows:

2023
2022
(as restated)
£
£


Valuation
(700,908)
(532,690)

(700,908)
(532,690)


19.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



2 (2022 - 2) Ordinary shares of £1.00 each
2
2



20.


Prior year adjustment

Dividend payable in 2022 of £1,000,000 was omitted in error from the 2022 accounts. 
Deferred tax brough forward of £1,544,192 has been restated to £532,690.


21.


Pension commitments

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 £11,455 (2022: £12,913). Contributions totalling £2,938 (2022: £2,493) were payable to the fund at the balance sheet date and are included in creditors

Page 25

 
SUTTON COLDFIELD HOTEL LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

22.


Related party transactions

The company has taken advantage of exemptions available from disclosing transactions with wholly owned members of the group.
Related parties include entities under the common control of the directors. At the balance sheet date, the total amount due from connected entities was  £10,681,142 (2022 - £5,313,448) and the total amount due to connected entities was £6,229,972 (2022 - £3,667,187). These amounts are interest free and repayable on demand.


23.


Controlling party

The immediate parent company is Savera Group UK Limited, a company incorporated in England and Wales. 
The smallest and largest group in which the results of the company are included are the consolidated financial statements of Savera Group UK Limited and these can be obtained from Companies House.

 
Page 26