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Registered number: 06304626










Pentland Properties Limited










Annual Report and Financial Statements

For the Year Ended 31 January 2024

 
Pentland Properties Limited
 

Company Information


Directors
P N Tory 
J N Tory 
D J Callister 
P J Rosbrook 




Company secretary
P J Rosbrook



Registered number
06304626



Registered office
The Estate Office
Etchinghill Golf Club

Etchinghill

Folkestone

Kent

CT18 8FA




Independent auditors
Kreston Reeves LLP
Chartered Accountants & Statutory Auditor

37 St Margaret's Street

Canterbury

Kent

CT1 2TU




Bankers
Lloyds Bank Plc
Sandgate Road

Folkestone

Kent

United Kingdom

CT20 2AA




Solicitors
Knights
34 Pocklington Walk

Leicester

Leicestershire

LE1 6BU





 
Pentland Properties Limited
 

Contents



Page
Strategic Report
 
1 - 2
Directors' Report
 
3 - 4
Independent Auditors' Report
 
5 - 8
Statement of Comprehensive Income
 
9
Balance Sheet
 
10
Statement of Changes in Equity
 
11
Statement of Cash Flows
 
12
Notes to the Financial Statements
 
13 - 22

 
Pentland Properties Limited
 

Strategic Report
For the Year Ended 31 January 2024

Introduction
 
The directors present their strategic report for the year ended 31 January 2024.

Business review
 
The majority of the turnover for the business came from its development at Saxon Place, Canterbury. This development has now been completed, and turnover has reduced accordingly. The largest contributor to profit in the year was the sale of a piece of land to a care home operator.
Despite the fall in turnover the directors are pleased to report that the pre-tax profit has increased to £1.89m, an increase of £0.1m on the prior year.
The company has successfully achieved an outline planning consent for 550 units at Kingsnorth, Ashford and is continuing to promote a number of larger developments through planning.
Financial key performance indicators
ole4925.png
ole5049.png
 

Principal risks and uncertainties
 
Planning delays caused by under resourced local authorities continue to be the principal risk to the business. 

Interest Rate Risk
The company has no borrowing and does not see the need for this to change in the foreseeable future.


Liquidity Risk
 
The company has no debt and shareholder funds of £14,596k leaving the company well capitalised to explore future land opportunities.

Page 1

 
Pentland Properties Limited
 

Strategic Report (continued)
For the Year Ended 31 January 2024


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



J N Tory
Director
Date: 11 July 2024
Page 2

 
Pentland Properties Limited
 

 
Directors' Report
For the Year Ended 31 January 2024

The directors present their report and the financial statements for the year ended 31 January 2024.

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.

Principal activity

The principal activity of the company is the construction and sale of domestic housing as well as the sale and purchase of land.

Results and dividends

The profit for the year, after taxation, amounted to £1,435,895 (2023 - £1,415,907).

The company paid dividends of £500,000 (2023: £500,000) during the year.

Directors

The directors who served during the year were:

P N Tory 
J N Tory 
D J Callister 
P J Rosbrook 

Objectives and policies
The company's objectives are to return consistent profits to shareholders, while maintaining good asset cover to support external funding. The company will work to obtain planning permissions on land that it holds, and to develop and sell homes and other properties.
The company's accounting policies allow for valuation of land at the lower of cost and net realisable value. The directors believe that the market value of land in its possession, both with and without planning permission, is considerably higher than the value shown in the accounts.
 
Page 3

 
Pentland Properties Limited
 

 
Directors' Report (continued)
For the Year Ended 31 January 2024

Going concern
The activities of the company and the factors that are likely to affect its future development. financial position and risk management objectives are described in the Strategic Report.
The company has appropriate financial resources and access to further funding, and the directors consider that the company is in a strong position to manage its business risks and to take advantage of the current favourable market conditions in the house-building industry. Consequently they continue to adopt the going concern basis in preparing the annual report and accounts.

Matters covered in the Strategic Report

The Strategic Report includes disclosure of the company's principal risks and exposure. Disclosure in respect of future developments has also been included as part of the Strategic Report.

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.

Auditors

Under section 487(2) of the Companies Act 2006Kreston Reeves LLP will be deemed to have been reappointed as auditors 28 days after these financial statements were sent to members or 28 days after the latest date prescribed for filing the accounts with the registrar, whichever is earlier.

Small companies note

In preparing this report, the directors have taken advantage of the small companies exemptions provided by section 415A of the Companies Act 2006.

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





J N Tory
Director
Date: 11 July 2024
Page 4

 
Pentland Properties Limited
 

 
Independent Auditors' Report to the Members of Pentland Properties Limited
 

Opinion


We have audited the financial statements of Pentland Properties Limited (the 'Company') for the year ended 31 January 2024, which comprise the Statement of Comprehensive Income, the Balance Sheet, the Statement of Cash Flows,the Statement of Changes in Equity and the related notes, including a summary of significant accounting 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 January 2024 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.


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.


Page 5

 
Pentland Properties Limited
 

 
Independent Auditors' Report to the Members of Pentland Properties Limited (continued)


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; or
the directors were not entitled to prepare the financial statements in accordance with the small companies regime and take advantage of the small companies' exemption in preparing the Directors' Report.


Responsibilities of directors
 

As explained more fully in the Directors' Responsibilities Statement set out on page 3, 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 6

 
Pentland Properties Limited
 

 
Independent Auditors' Report to the Members of Pentland Properties 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:

Capability of the audit in detecting irregularities, including fraud:
Based on our understanding of the company and industry, and through discussion with the directors and other management (as required by auditing standards), we identified that the principal risks of non-compliance with laws and regulations related to health and safety, anti-bribery and employment law. We considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006. We communicated identified laws and regulations throughout our team and remained alert to any indications of non-compliance throughout the audit. We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to posting inappropriate journal entries to increase revenue or reduce expenditure, management bias in accounting estimates and judgemental areas of the financial statements such as the valuation of work in progress. Audit procedures performed by the company engagement team included:
ole4183.png
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.


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 7

 
Pentland Properties Limited
 

 
Independent Auditors' Report to the Members of Pentland Properties 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.





Mark Attwood FCCA (Senior Statutory Auditor)
for and on behalf of
Kreston Reeves LLP
Chartered Accountants
Statutory Auditor
Canterbury

12 July 2024
Page 8

 
Pentland Properties Limited
 

Statement of Comprehensive Income
For the Year Ended 31 January 2024

2024
2023
Note
£
£

  

Turnover
 4 
3,867,732
20,888,895

Cost of sales
  
(1,759,065)
(18,265,911)

Gross profit
  
2,108,667
2,622,984

Administrative expenses
  
(356,763)
(696,791)

Operating profit
  
1,751,904
1,926,193

Interest receivable and similar income
 8 
306,617
35,760

Interest payable and similar expenses
 9 
(169,186)
(209,490)

Profit before tax
  
1,889,335
1,752,463

Tax on profit
 10 
(453,440)
(336,556)

Profit for the financial year
  
1,435,895
1,415,907

There was no other comprehensive income for 2024 (2023:£NIL).

The notes on pages 13 to 22 form part of these financial statements.
Page 9

 
Pentland Properties Limited
Registered number: 06304626

Balance Sheet
As at 31 January 2024

2024
2023
Note
£
£

  

Current assets
  

Stocks
 12 
12,403,466
11,620,135

Debtors
 13 
7,386,957
6,176,767

Cash at bank and in hand
 14 
13,078
1,064,869

  
19,803,501
18,861,771

Creditors: amounts falling due within one year
 15 
(5,142,376)
(5,093,563)

Net current assets
  
 
 
14,661,125
 
 
13,768,208

Total assets less current liabilities
  
14,661,125
13,768,208

Provisions for liabilities
  

Other provisions
 16 
(64,689)
(107,667)

  
 
 
(64,689)
 
 
(107,667)

Net assets
  
14,596,436
13,660,541


Capital and reserves
  

Called up share capital 
 17 
15,664
15,664

Share premium account
  
4,148,533
4,148,533

Profit and loss account
  
10,432,239
9,496,344

  
14,596,436
13,660,541


The Company's financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.

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




J N Tory
Director
Date: 11 July 2024

The notes on pages 13 to 22 form part of these financial statements.
Page 10

 
Pentland Properties Limited
 

Statement of Changes in Equity
For the Year Ended 31 January 2024


Called up share capital
Share premium account
Profit and loss account
Total equity

£
£
£
£


At 1 February 2022
15,664
4,148,533
8,580,437
12,744,634



Profit for the year
-
-
1,415,907
1,415,907


Contributions by and distributions to owners

Dividends: Equity capital
-
-
(500,000)
(500,000)



At 1 February 2023
15,664
4,148,533
9,496,344
13,660,541



Profit for the year
-
-
1,435,895
1,435,895


Contributions by and distributions to owners

Dividends: Equity capital
-
-
(500,000)
(500,000)


At 31 January 2024
15,664
4,148,533
10,432,239
14,596,436


The notes on pages 13 to 22 form part of these financial statements.
Page 11

 
Pentland Properties Limited
 

Statement of Cash Flows
For the Year Ended 31 January 2024

2024
2023
£
£

Cash flows from operating activities

Profit for the financial year
1,435,895
1,415,907

Adjustments for:

Interest paid
169,186
209,490

Interest received
(306,617)
(35,760)

Taxation charge
453,440
336,556

(Increase)/decrease in stocks
(783,331)
3,395,344

(Increase)/decrease in debtors
(1,210,190)
1,398,052

(Decrease) in creditors
(102,380)
(3,710,605)

(Decrease) in provisions
(42,978)
(5,340,309)

Corporation tax (paid)
(302,247)
(36,596)

Net cash generated from operating activities

(689,222)
(2,367,921)


Cash flows from investing activities

Interest received
306,617
35,760

Net cash from investing activities

306,617
35,760

Cash flows from financing activities

Dividends paid
(500,000)
(500,000)

Interest paid
(169,186)
(209,490)

Net cash used in financing activities
(669,186)
(709,490)

Net (decrease) in cash and cash equivalents
(1,051,791)
(3,041,651)

Cash and cash equivalents at beginning of year
1,064,869
4,106,520

Cash and cash equivalents at the end of year
13,078
1,064,869


Cash and cash equivalents at the end of year comprise:

Cash at bank and in hand
13,078
1,064,869

13,078
1,064,869


The notes on pages 13 to 22 form part of these financial statements.

Page 12

 
Pentland Properties Limited
 

 
Notes to the Financial Statements
For the Year Ended 31 January 2024

1.


General information

Pentland Properties Limited is a private company limited by shares, incorporated in England and Wales with registration number 06304626. The address of its registered office is Etchinghill Golf Club, Etchinghill, Folkestone, Kent, CT18 8FA.
The principal activity of the company in the year under review was the purchase and sale of land, and the building of new build housing in the Southeast of England.

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 company's functional currency is Pounds Sterling.
The company's financial statements are presented to the nearest £. 

The following principal accounting policies have been applied:

 
2.2

Going concern

The activities of the company and the factors that are likely to affect its future development, financial position and risk management objectives are described in the Strategic Report.
The company has considerable financial resources and access to further funding, and the directors consider that the company is in a strong position to manage its business risks and to take advantage of the continuing market conditions in the house-building industry. Consequently, they continue to adapt the going concern basis in preparing the annual report and accounts. 
 

Page 13

 
Pentland Properties Limited
 

 
Notes to the Financial Statements
For the Year Ended 31 January 2024

2.Accounting policies (continued)

 
2.3

Revenue

Revenue from sale of commercial and residential units is recognised on legal completion which is when title passes to the buyer. 
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:

Sale of goods

Revenue from the sale of goods is recognised when all of the following conditions are satisfied:
the Company has transferred the significant risks and rewards of ownership to the buyer;
the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
the amount of revenue can be measured reliably;
it is probable that the Company will receive the consideration due under the transaction; and
the costs incurred or to be incurred in respect of the transaction can be measured reliably.

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.

 
2.4

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.

 
2.5

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.

Page 14

 
Pentland Properties Limited
 

 
Notes to the Financial Statements
For the Year Ended 31 January 2024

2.Accounting policies (continued)

 
2.6

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.

In the Statement of Cash Flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Company's cash management.

 
2.7

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.

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 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.
 
Page 15

 
Pentland Properties Limited
 

 
Notes to the Financial Statements
For the Year Ended 31 January 2024

2.Accounting policies (continued)


2.7
Financial instruments (continued)


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.

 
2.8

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.

 
2.9

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.

 
2.10

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.

 
2.11

Interest income

Interest income is recognised in profit or loss using the effective interest method.

 
2.12

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.

Page 16

 
Pentland Properties Limited
 

 
Notes to the Financial Statements
For the Year Ended 31 January 2024

2.Accounting policies (continued)

 
2.13

Taxation

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.


3.


Judgments in applying accounting policies and key sources of estimation uncertainty

Estimates and judgements are continually evaluated and are based on historic experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. 
The Company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, rarely equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are outlined below: 
(i) Valuation of inventories 
The Company values inventories at the lower of cost and net realisable value. The net realisable value is based on the judgement of the probability that planning consent will be granted for each site. The Company believes that based on directors' experience, planning consent will be given. If planning consent was not achieved, then a provision may be required against inventories. 
In applying the Company's accounting policy for the valuation of inventories the directors are required to assess the expected selling price and costs to sell each of the plots or units that constitute the Company's work in progress. Cost includes the cost of acquisition sites, the cost or infrastructure and construction works, and legal and professional fees incurred during development prior to sale. Estimation of selling price is subject to significant inherent uncertainties, in particular the prediction of future trends in the market value of land. 
Whilst the directors exercise due care and attention to make reasonable estimates, taking into account all available information in estimating the future selling price, the estimates will, in all likelihood, differ from actual selling prices achieved in future periods and these differences may, in certain circumstances, be very significant. The critical judgement in respect of receipt of planning consent further increases the level of estimation uncertainty. 


4.


Turnover

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


2024
2023
£
£

Property sale and rental
3,867,732
20,888,895

3,867,732
20,888,895


All turnover arose within the United Kingdom.

Page 17

 
Pentland Properties Limited
 

 
Notes to the Financial Statements
For the Year Ended 31 January 2024

5.


Auditors' remuneration



2024
2023
£
£



Fees payable to the Company's auditor and its associates for the audit of the Company's annual financial statements
17,350
16,500


6.


Employees

2024
2023
£
£

Wages and salaries
314,046
762,847

314,046
762,847


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


        2024
        2023
            No.
            No.







Average number of employees
4
4


7.


Directors' remuneration

2024
2023
£
£

Directors' emoluments
306,379
159,953

306,379
159,953


The highest paid director received remuneration of the above amount.


8.


Interest receivable

2024
2023
£
£


Other interest receivable
306,617
35,760

306,617
35,760

Page 18

 
Pentland Properties Limited
 

 
Notes to the Financial Statements
For the Year Ended 31 January 2024

9.


Interest payable and similar expenses

2024
2023
£
£


Other loan interest payable
169,186
209,490

169,186
209,490


10.


Taxation


2024
2023
£
£

Corporation tax


Current tax on profits for the year
453,440
336,556


453,440
336,556


Total current tax
453,440
336,556


Factors affecting tax charge for the year

The tax assessed for the year is lower than (2023 - lower than) the standard rate of corporation tax in the UK of 25% (2023 - 19%). The differences are explained below:

2024
2023
£
£


Profit on ordinary activities before tax
1,889,335
1,752,463


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2023 - 19%)
472,334
340,979

Effects of:


Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
464
(4,423)

Changes in provisions leading to an increase (decrease) in the tax charge
(19,358)
-

Total tax charge for the year
453,440
336,556


11.


Dividends

2024
2023
£
£


Dividends on equity capital
500,000
500,000

500,000
500,000

Page 19

 
Pentland Properties Limited
 

 
Notes to the Financial Statements
For the Year Ended 31 January 2024

12.


Stocks

2024
2023
£
£

Work in progress
12,403,466
11,620,135

12,403,466
11,620,135



13.


Debtors

2024
2023
£
£

Due after more than one year

Amounts owed by companies under common control
3,191,224
2,296,139

Other debtors
3,849,046
3,843,046

7,040,270
6,139,185

Due within one year

Trade debtors
11,900
466

Other debtors
8,083
11,908

Prepayments and accrued income
326,704
25,208

7,386,957
6,176,767



14.


Cash and cash equivalents

2024
2023
£
£

Cash at bank and in hand
13,078
1,064,869

13,078
1,064,869


Page 20

 
Pentland Properties Limited
 

 
Notes to the Financial Statements
For the Year Ended 31 January 2024

15.


Creditors: Amounts falling due within one year

2024
2023
£
£

Trade creditors
30,579
76

Amounts owed to companies under common control
3,099,581
3,100,664

Corporation tax
243,749
92,556

Other taxation and social security
7,665
562,039

Other creditors
1,443,310
1,223,024

Accruals and deferred income
317,492
115,204

5,142,376
5,093,563



16.


Provisions





 
 
Customer care and cost to complete provision

£





At 1 February 2023
107,667


Charged to profit or loss
(42,978)



At 31 January 2024
64,689


17.


Share capital

2024
2023
£
£
Allotted, called up and fully paid



15,664 (2023 - 15,664) Ordinary Shares shares of £1.00 each
15,664
15,664


Page 21

 
Pentland Properties Limited
 

 
Notes to the Financial Statements
For the Year Ended 31 January 2024
18.


Analysis of net debt




At 1 February 2023
Cash flows
At 31 January 2024
£

£

£

Cash at bank and in hand

1,064,869

(1,051,791)

13,078

Debt due within 1 year

-

-

-


1,064,869
(1,051,791)
13,078


19.


Related party transactions

1) P N Tory and JN Tory are both directors and shareholders of Pentland Properties Limited and also directors and shareholders of Pentland Homes Limited. During the year Pentland Homes Limited provided £3,309,508 (2023: £22,586,728) worth of goods and services to the company. During the prior year a management charge of £339,968 was also charged by Pentland Homes Limited to Pentland Properties Limited. At the year end, the company owed £91,603 (2023: £100,664) to Pentland Homes Limited.
2) The following loans have been made to the company and remained outstanding at the year end:
i) P N Tory: The company owed P N Tory the sum of £4,128,011 (2023: £3,970,931) at the year end. During the year the interest of £160,932 (2023: £157,822) was charged in respect of this loan.
ii) J N Tory: During the year the company received a loan of £306,595 from J N Tory. During the year interest of £4,088 was charged in respect of this loan.
iii) J Callister: The company owed J Callister the sum of £Nil (2023: £250,000) at the year end. During the year interest of £4,167 (2023: £46,365) was charged in respect of this loan. 
Interest is paid at 4% per annum on the above loans. The loans are repayable in next few years. J N Tory is both a director of Pentland Properties Limited and also controls Cave Hotels UK Limited. P N Tory is a director of Pentland Properties Limited.
During the year costs of £83,322 (2023: £86,673) were recharged to Cave Hotels UK Ltd and costs of £1,400 (2023: £Nil) were recharged by Cave Hotels UK Ltd. At the year end, Cave Hotels UK Ltd owed £25,712 (2023: £37,661) to the company.


20.


Controlling party

P N Tory and J N Tory are the ultimate controlling parties by virtue of their majority shareholding in the company. 

Page 22