Company Registration No. SC058713 (Scotland)
BANCON GROUP LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2024
BANCON GROUP LIMITED
COMPANY INFORMATION
Directors
K J McColgan
A H Tweedie
D Crawford
J Tosh
J Wright
Company number
SC058713
Registered office
Burnett House
Burn O'Bennie Road
Banchory
Aberdeenshire
AB31 5ZU
Auditor
Johnston Carmichael LLP
Bishop's Court
29 Albyn Place
Aberdeen
AB10 1YL
BANCON GROUP LIMITED
CONTENTS
Page
Strategic report
1 - 3
Directors' report
4 - 5
Directors' responsibilities statement
6
Independent auditor's report
7 - 10
Statement of comprehensive income
11
Balance sheet
12
Statement of changes in equity
  13
Notes to the financial statements
14 - 23
BANCON GROUP LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2024
The directors present the strategic report and financial statements for the year ended 31 March 2024.  The company is part of the Bancon Developments Holdings Limited Group ("the Group").
Review of the business
The principal activity of the company during the financial year was the promotion and management of land interests on behalf of the Group.
The results for the company show a profit before taxation of £2.4m (2023: £4.0m) for the year.
The company received dividends from subsidiary companies in the year of £3.0m (2023: £4.0m) and this was passed on to the parent company. Costs incurred in the year relate to writing down historic land assets to reflect the directors view of net realisable value.
The company's net assets at 31 March 2024 were £1.9m (2023: £2.4m).
Principal risks and uncertainties
The management of the business and the execution of the company's strategy are subject to a number of risks.
Key business risks and uncertainties affecting the company are considered to relate to the planning process, housing market confidence, the availability of funds to house purchasers and potential business disruption due to the likes of a pandemic.
Delays in the planning process could impact on the timing of new developments with a subsequent impact on profits and cash-flows, to mitigate this risk we have our own in-house planning team with the requisite experience and skills to manage our planning requirements.
Housing market confidence could impact overall activity levels and profitability and the business constantly assesses the latest market and economic data to ensure our product and service offerings reflect the current market conditions and remain competitive in mitigation of this risk.
A lack of available funds for purchasers could affect sales rates which would impact profits and cash-flows. The company provides the support of independent financial advisers to help prospective house purchasers in mitigation of this risk.
Regarding the risk of pandemic or similar disruption, the business has contingency plans in place to mitigate against further potential disruption to activities.
Key performance indicators
The directors of Bancon Group Limited review detailed management reports on a monthly basis and consider the key performance indicators to be net margin, customer satisfaction and health and safety scores.
Streamlined energy and carbon reporting
Streamlined energy and carbon reporting requirements have been disclosed on a group basis within the financial statements of the company's ultimate parent, Bancon Developments Holdings Limited, which includes the relevant energy and carbon information for the company. As such, the company is not obliged and has not reported their energy and carbon information here. The financial statements of Bancon Developments Holdings Limited are accessible via UK Companies House.
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BANCON GROUP LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
Section 172 (1) Statement
As directors of the company we have acted, and continue to act, in a way that we consider to be most likely to promote the continuing success of the company for the benefit of its members.  In doing so we have had regard, amongst other matters, to:
The likely consequences of any decision in the long term;
The interests of the company's employees;
The need to foster the company's business relationships with suppliers, customers, and others;
The impact of the company's operations on the community and environment;
The desirability of the company maintaining a reputation for high standards of business conduct; and
The need to act fairly between members of the company.
The following are some examples as to how the directors have had regard to the matters set out above when discharging our section 172 duties:
The key strategic objective is to build a sustainable business for the benefit of current and future stakeholders.  This involves us taking decisions both for the present and future benefit of the business.  The executive directors work within the business on a daily basis, ensuring that key internal and external relationships are maintained directly and employees, suppliers and customers have appropriate access to us.  Our management structure and reporting and communication lines are also organised in such a way that the impact and implications of key decisions are well understood throughout the organisation, with the appropriate level of input at all levels throughout the structure.
The employees are critical to the continued success of the business and it is key we effectively engage with them.  Examples of how this is achieved include:
Concerted focus on appraisal and personal development process;
Regular business updates through various channels;
Offering the opportunity for professional and career development through relevant training;
Linking an element of employee reward to the financial success of the Group and the company; and
Having appropriate whistleblowing procedures.
We also ensure there is a wider understanding of, and alignment on key strategic objectives through regular formal and informal communication forums.
We maintain strong relationships with our suppliers and customers through the following practices:
Regular contact and meetings with our key suppliers;
Encouraging our customers and suppliers to raise any issues or concerns they have regarding their relationship;
Continuing to focus on the qualities that appeal to our customer base and differentiate us from our competitors; and
Offering dedicated points of contact within our team to promote the building of long-term relationships with our customers and suppliers.
We are committed to supporting the communities that we work in and being environmentally responsible.  Corporate Social Responsibility is a key area of management focus and is reported on at a Board level.  We undertake various initiatives to improve contributions to these communities and promote the effective use of resources to avoid the unnecessary generation of waste and pollution, with a focus on sustainability and compliance with environmental standards and targets.
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BANCON GROUP LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
Section 172 (1) Statement (continued)
We are also committed to conducting our business in an ethical manner. These values are engrained in the culture and encompass our commitment to ensure the highest standard of ethics in the way we conduct our business.
The company's ultimate controlling party is J C A Burnett of Leys and his family and as such no conflicts exist between shareholders in relation to the company.
On behalf of the board
..............................
A H Tweedie
Director
12/07/2024
.........................
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BANCON GROUP LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2024
The directors present their annual report and financial statements for the year ended 31 March 2024.
Directors
The following directors have held office since 1 April 2023 unless otherwise stated:
K J McColgan
(appointed 29 September 2023)
A H Tweedie
J Wright
D Crawford
J Tosh
(appointed 15 January 2024)
S Buntrock
(resigned 24 January 2024)
J C Irvine
(resigned 29 September 2023)
A J Clow
(resigned 4 July 2023)
Results and dividends
The results for the year are set out on page 11.  Dividends of £3,000,001 were declared in the year (2023: £4,000,002).
Financial risk management
The company's activities expose it mainly to liquidity and credit risks. The company does not use derivatives to manage financial risks or for speculative purposes.
Liquidity risk
In order to maintain liquidity to ensure that sufficient funds are available for ongoing operations and future operations, the company has access to bank funding facilities which are agreed on a group wide basis.  These debt facilities would typically be linked to the base rate which will present no significant interest rate risk to the business, with intergroup borrowings being interest free.
Credit risk
The company operates procedures that ensure appropriate credit checks on potential customers are carried out before contracts are concluded.  During the course of the projects, credit control procedures are in place to minimise any credit risk to the business. The majority of the company's debtor balances are with group entities which reduces the company's overall credit risk.
Disabled persons
Applications for employment by disabled persons are always fully considered, bearing in mind the aptitudes of the applicant concerned. In the event of members of staff becoming disabled, every effort is made to ensure that their employment within the company continues and that the appropriate training is arranged. It is the policy of the company that the training, career development and promotion of disabled persons should, as far as possible, be identical to that of other employees.
Employee involvement
The group believes that continued development and training of their staff is a key factor in achieving the skills, quality and motivation within the workforce for the future success of the business.
Through the use of our in-house group newsletter, intranet and employee presentations within each company, we continue to inform all staff of decisions that may affect their interests and they also give the employees the platform on which they can make suggestions to improve the financial performance of the group.
Engagement with employees, suppliers, customers and others and streamlined energy and carbon reporting
As noted within the Strategic Report, section 172 requirements including engagement with employees, suppliers, customers, and others, have been disclosed.  Energy usage and greenhouse gas emissions are also detailed in the Strategic Report for Bancon Developments Holdings Limited.  As such this information is not reported here although this note serves as a cross-reference to the Strategic Report.
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BANCON GROUP LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
Future developments
The business continues to invest in its infrastructure and land assets, to ensure its growth aspirations can be realised in the short and medium term.
Reappointment of auditor
Johnston Carmichael LLP have indicated their willingness to be reappointed for another term and appropriate arrangements have been put in place for them to be deemed reappointed as auditors in the absence of an Annual General Meeting.
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company's auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company's auditor is aware of that information.
On behalf of the board
..............................
A H Tweedie
Director
12/07/2024
2024-07-12
.........................
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BANCON GROUP LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 MARCH 2024
The directors are responsible for preparing the Strategic Report, 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 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 then apply them consistently;
  • *
make judgements and accounting estimates that are reasonable and prudent;
  • *
state whether applicable UK Accounting Standards have been followed subject to any material departures disclosed and explained in the financial statements;
  • *
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.
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BANCON GROUP LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF BANCON GROUP LIMITED
Opinion
We have audited the financial statements of Bancon Group Limited (‘the company') for the year ended 31 December 2024, which comprise the Statement of Comprehensive Income, Balance Sheet, Statement of Changes in Equity, and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including 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 March 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 Auditor 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 UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the 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 auditor's report thereon. The Directors are responsible for the other information contained within the Annual Report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated.  If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves.  If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions 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.
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BANCON GROUP LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF BANCON GROUP LIMITED
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 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.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: http://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
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BANCON GROUP LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF BANCON GROUP LIMITED
Extent to which the audit is considered capable of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations.  We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud.  The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
We assessed whether the engagement team collectively had the appropriate competence and capabilities to identify or recognise non-compliance with laws and regulations by considering their experience, past performance and support available.
All engagement team members were briefed on relevant identified laws and regulations and potential fraud risks at the planning stage of the audit. Engagement team members were reminded to remain alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.
We obtained an understanding of the legal and regulatory frameworks that are applicable to the company and the sector in which it operates, focusing on those provisions that had a direct effect on the determination of material amounts and disclosures in the financial statements. The most relevant frameworks we identified include:
Companies Act 2006;
UK Tax legislation and
UK Generally Accepted Accounting Practice.
We gained an understanding of how the company is complying with these laws and regulations by making enquiries of management and those charged with governance. We corroborated these enquiries through our review of submitted returns, external inspections, relevant correspondence with regulatory bodies and board meeting minutes.
We assessed the susceptibility of the financial statements to material misstatement, including how fraud might occur, by meeting with management and those charged with governance to understand where it was considered there was susceptibility to fraud. This evaluation also considered how management and those charged with governance were remunerated and whether this provided an incentive for fraudulent activity. We considered the overall control environment and how management and those charged with governance oversee the implementation and operation of controls. In areas of the financial statements where the risks were considered to be higher, we performed procedures to address each identified risk. We identified a heightened fraud risk in relation to:
Management override of controls
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BANCON GROUP LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF BANCON GROUP LIMITED
Extent to which the audit is considered capable of detecting irregularities, including fraud (continued)
In addition to the above, the following procedures were performed to provide reasonable assurance that the financial statements were free of material fraud or error:
Reviewing minutes of meetings of those charged with governance for reference to: breaches of laws and regulation or for any indication of any potential litigation and claims; and events or conditions that could indicate an incentive or pressure to commit fraud or provide an opportunity to commit fraud;
Reviewing the level of and reasoning behind the company's procurement of legal and professional services;
Performing audit procedures over the risk of management override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing judgements made by management in their calculation of accounting estimates for potential management bias;
Completion of appropriate checklists and use of our experience to assess the company's compliance with the Companies Act 2006; and
Agreement of the financial statement disclosures to supporting documentation.
Our audit procedures were designed to respond to the risk of material misstatements in the financial statements, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve intentional concealment, forgery, collusion, omission or misrepresentation. There are inherent limitations in the audit procedures performed and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it.
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.
Stephen McIlwaine (Senior Statutory Auditor)
16/07/2024
2024-07-16
for and on behalf of Johnston Carmichael LLP
.........................
Chartered Accountants
Statutory Auditor
Bishop's Court
29 Albyn Place
Aberdeen
AB10 1YL
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BANCON GROUP LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2024
2024
2023
  Notes
£
£
Turnover
-
-
Cost of sales
(538,588)
4,106
Gross (loss) / profit
(538,588)
4,106
Administrative expenses
(102,168)
(33,954)
Operating loss
  5
(640,756)
(29,848)
Dividends received
3,000,000
4,000,000
Interest receivable and similar income
4
8,291
Profit before taxation
2,367,535
3,970,152
Taxation
   7
155,325
2,738
Profit/total comprehensive income for the financial year
2,522,860
3,972,890
The Statement of Comprehensive Income has been prepared on the basis that all operations are continuing.
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BANCON GROUP LIMITED
BALANCE SHEET
AS AT 31 MARCH 2024
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
8
20,513
35,022
Finance lease receivable
9
392,522
-
Investments
10
1,437,562
1,437,562
1,850,597
1,472,584
Current assets
Stocks
12
3,205,894
3,694,062
Debtors
13
11,750,494
9,752,617
Cash at bank and in hand
421,333
-
15,377,722
13,446,679
Creditors: amounts falling due within one year
14
(15,330,908)
(12,544,711)
Net current assets
46,814
901,968
Net assets
1,897,411
2,374,552
Capital and reserves
Called up share capital
16
665
665
Profit and loss reserves
17
1,896,746
2,373,887
Total equity
1,897,411
2,374,552
The financial statements were approved by the board of directors and authorised for issue on
12/07/2024
12 July 2024
and are signed on its behalf by:
..............................
..............................
K J McColgan
A H Tweedie
Director
Director
Company Registration No. SC058713
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BANCON GROUP LIMITED
BALANCE SHEET
AS AT
31 MARCH 2024
31 March 2024
Share capital
Profit and loss reserves
Total
Notes
£
£
£
Balance at 1 April 2022
665
2,400,999
2,401,664
Year ended 31 March 2023:
Profit and total comprehensive income for the year
                                -            3,972,890           3,972,890
Dividends
7
-
(4,000,002)
(4,000,002)
Balance at 31 March 2023
665
2,373,887
2,374,552
Year ended 31 March 2024:
Profit and total comprehensive income for the year
-
2,522,860
2,522,860
Dividends
7
-
(3,000,001)
(3,000,001)
Balance at 31 March 2024
665
1,896,746
1,897,411
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BANCON GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
AS AT 31 MARCH 2024
Accounting policies
1
Company information
Bancon Group Limited ("the company") is a private company limited by shares, incorporated and domiciled in Scotland. The principal activities of the company and the nature of the operations are set out in the Strategic Report on pages 1 to 3.  The company's trading address is Burnett House, Burn O'Bennie Road, Banchory, AB31 5ZU.
1.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest pound.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
The company has taken advantage of the exemption available in accordance with Section 33 of FRS 102 "Related Party Disclosures" not to disclose transactions entered into between two or more wholly owned members of a group.
FRS 102 reduced disclosure framework
The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company's parent company is Bancon Developments Holdings Limited and the company has taken advantage of the following disclosure exemptions under FRS102:
The requirements of Section 7 Statement of Cash Flows and Section 3 Financial Statement Presentation paragraph 3.17 (d);
The requirement of Section 11 Basic Financial Instruments paragraphs 11.42, 11.44, 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c); and
The requirement of Section 33 Related Party Disclosures paragraph 33.7.
Group accounts
The financial statements contain information about Bancon Group Limited as an individual company and do not contain consolidated financial information as the parent of a group. The company is exempt under section 400 of the Companies Act 2006 from the requirement to prepare consolidated financial statements as it and its subsidiary undertakings are included by full consolidation in the consolidated financial statements of its ultimate parent company, Bancon Developments Holdings Limited, a company registered in Scotland.
1.2
Going concern
The directors have considered the principal risks and uncertainties the company faces and other factors impacting the company's future performance. The directors believe the company has adequate resources to continue in operational existence for the foreseeable future. Thus they continue to adopt the going concern basis of accounting in preparing the financial statements. In making this assessment, the directors have considered a period of at least twelve months from the date of approving these financial statements.
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BANCON GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies (continued)
1.3
Tangible fixed assets
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Tenant's improvements
10 years
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.
Expenditure incurred after the asset is put into use, such as repairs and maintenance costs, are expensed in the period incurred, while other expenses that are expected to generate future economic benefits are capitalised.
1.4
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessees. All other leases are classified as operating leases.
Amounts due from lessees under finance leases are recognised as receivables at the amount of the company's net investment in the leases. Finance lease income is allocated to accounting periods so as to reflect a constant periodic rate of return on the company's net investment outstanding in respect of leases.
1.5
Fixed asset investments
Interests in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.
A subsidiary is an entity controlled by the company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.
1.6
Impairment of fixed assets
At each reporting period end date, the company reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any) by comparing this to the asset's carrying value. The recoverable amount of the asset is the higher of the fair value less costs to sell and value in use. Value in use is defined as the present value of future cash flows before interest and tax, obtained as a result of the asset's continued use.
1.7
Stock and work in progress
Land is stated at the lower of cost and net realisable value. Cost comprises raw materials, consumables and direct labour plus attributable overheads based on a normal level of activity. Net realisable value is based on the estimated selling price less anticipated costs to completion and disposal.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in the profit and loss account. Reversals of impairment losses are also recognised in the profit and loss account.
1.8
Land options
Land options are included within work in progress at cost. If, or when, it becomes apparent that an option on land relating to a potential development site will not receive the necessary approvals, the option will be charged in full to the profit and loss account.
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BANCON GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies (continued)
1.9
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
1.10
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments' and Section 12 ‘Other Financial Instruments Issues' of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.
Basic financial assets
Basic financial assets, which include trade and other receivables, amounts due from group undertakings and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method 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. The effective interest rate is the rate that exactly discounts estimated future cash receipts/payments through the expected life of the investment to the net carrying amount on initial recognition. Financial assets classified as receivable within one year are not amortised.
Impairment of financial assets
Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset's original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Basic financial liabilities
Basic financial liabilities, including trade and other payables and amounts due to group undertakings, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Basic financial liabilities are subsequently carried at amortised cost, using the effective interest rate method.
- 16 -
BANCON GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
1
Accounting policies (continued)
1.11
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company's liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
Deferred tax
Deferred tax is provided, using the full liability method, on temporary differences arising between the tax base of assets and liabilities and their carrying amounts in the financial statements. The deferred tax position is calculated using the rates enacted or substantially enacted at the balance sheet date. Tax losses are surrendered or claimed in the form of group relief with consideration being received or paid accordingly. The group relief amount is recorded separately within the debtors and creditors amounts in the balance sheet, as applicable, and is calculated by applying the tax rate enacted or substantively enacted at the balance sheet date to the loss amount.
Deferred tax assets are recognised to the extent that it is probable that future taxable profits will be available against which the temporary differences can be utilised.
1.12
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee's services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
1.13
Retirement benefits
The company operates a defined contribution scheme for the benefit of its employees. Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
Differences between contractual contributions payable in the year and contributions actually paid are shown as either accruals or in prepayments in the balance sheet.
- 17 -
BANCON GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
2
Judgements and key sources of estimation uncertainty
In the application of the company's accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
The following are considered to be either judgements that have had the most significant effect on amounts recognised in the financial statements, or estimates that are dependent upon the assumptions which could change in the next financial year and have a material effect on the carrying amounts of assets and liabilities recognised at the balance sheet date:
Stock and work in progress
Land stock is one of the largest assets on the balance sheet. In order to assess the appropriateness of carrying value, the directors and management are required to consider the potential for each site and land option in order to assess whether any impairments or reversals are required to ensure stock and work in progress is stated at the lower of cost and net realisable value.
During the year ended 31 March 2024, the directors and management concluded reviews of the net realisable value of its work in progress. This review did not result in any further impairments or reversals of previous impairments. The reviews were conducted across sites, using valuations that incorporated selling price and development cost movements, based on the directors' and management's assessment of market conditions existing at the balance sheet date. If there are significant movements in house prices or development costs beyond expectations then further impairments/reversals of previous impairments of stock and work in progress may be necessary.
The directors consider that there are no other judgements, estimates and underlying assumptions which have a significant risk of causing material adjustment to the carrying amounts of the assets and liabilities.
3
Interest receivable and similar income
Other finance income:
2024
2023
£
£
Interest on finance leases
8,291
-
4
Operating loss
2024
2023
Operating loss for the year is stated after charging:
£
£
Depreciation of owned tangible fixed assets
14,509
14,509
The audit fee has been borne by the ultimate parent company Bancon Developments Holdings Limited in the current and previous years. For the current year, the portion of the group audit fee relating to this company's audit was £1,300 (2023: £1,200). Non-audit fees in respect of the company were £222 (2023: £363).
- 18 -
BANCON GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2024
2023
Number
Number
Administration
5
5
5
5
Their aggregate remuneration comprised:
2024
2023
£
£
Wages and salaries
110,841
94,180
Social security costs
9,001
7,783
Pension costs
15,502
6,270
135,344
108,233
The directors are remunerated for their services through other group companies.
6
Taxation
2024
2023
£
£
Current tax
Group relief credit for current year
(155,325)
(2,738)
The company has no deferred tax.
The actual credit for the year can be reconciled to the expected credit for the year based on the profit or loss and the standard rate of tax as follows:
2024
2023
£
£
Profit before taxation
2,367,535
3,970,152
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2019: 19.00%)
591,884
754,329
Non-taxable dividend income
(750,000)
(760,000)
Fixed asset differences
3,403
2,373
Group relief surrendered
155,325
2,738
Deferred tax assets not recognised
-
736
Effects of changes in tax rates and laws
-
(176)
Group relief receipt
(155,325)
(2,738)
Taxation credit for the year
(155,325)
(2,738)
- 19 -
BANCON GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
7
Dividends paid
Dividends of £3,000,001 (2023 - £4,000,002) were paid during the year.
8
Tangible fixed assets
Tenants improvements
£
Cost
At 1 April 2023
145,088
Additions
         At 31 March 2024
145,088
Depreciation and impairment
At 1 April 2023
110,066
Depreciation charge in the year
14,509
At 31 March 2024
124,575
Carrying amount
At 31 March 2024
20,513
At 31 March 2023
35,022
9
Finance lease receivable
2024
2023
£
£
Gross amounts receivable under finance leases:
Unearned finance income
46,463
-
Present value of minimum lease payments receivable
346,048
-
The present value is receivable as follows:
95,695
-
Within one year
343,291
-
Between 1 and 5 years
Finance lease receivables represent rentals receivables by the company for certain items of plant and machinery. No restrictions are placed on the use of the assets. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments. Net obligations due on finance leases are secured by fixed charges on the assets concerned.
The finance leases are with other group undertakings and are held within amounts owed from group undertakings within their respective notes.
10
Fixed asset investments
2024
2023
£
£
Investments in subsidiaries (see note 11)
1,437,562
1,437,562
There has been no movement in the fixed asset investment during the year.
- 20 -
BANCON GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
11
Subsidiaries
Details of the company's subsidiaries at 31 March 2024 are as follows:
Name of undertaking and country of
Nature of business
Class of
% Held
incorporation or residency
shareholding
Direct
Bancon Construction Limited (2)
Scotland
Construction
200 ordinary 50p shares
100.00
Bancon Homes (Deeside) Limited (1)
Scotland
Housebuilders
100 ordinary £1 shares
100.00
Bancon Homes (Donside) Limited (1)
Scotland
Housebuilders
100 ordinary £1 shares
100.00
Bancon Homes Limited (1)
Scotland
Housebuilders
100 ordinary £1 shares
100.00
Deeside Timberframe Limited (2)
Scotland
Manufacture and supply of timberframe structures
1 ordinary £1 share
100.00
The registered offices for each subsidiary are listed below:
(1) Burnett House, Burn O'Bennie Road, Banchory, Aberdeenshire, Scotland, AB31 5ZU;
(2) Banchory Business Centre, Burn O'Bennie Road, Banchory, Aberdeenshire, Scotland, AB31 5ZU.
The aggregate capital and reserves and the result for the year of the subsidiaries noted above was as follows:
Name of undertaking
Profit/(Loss)
Capital and
Reserves/
(Net liabilities)
£
£
Bancon Construction Limited
355,827
1,583,506
Bancon Homes (Deeside) Limited
(8,712)
       (48,194)
Bancon Homes (Donside) Limited
(1,193)
302,006
Bancon Homes Limited
2,019,049
7,825,947
Deeside Timberframe Limited
1,119,942
5,893,911
12
Stocks
2024
2023
£
£
Work in progress
3,205,894
3,694,062
3,205,894
3,694,062
- 21 -
BANCON GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
13
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade Debtors
2,542
1,793
Amount due from parent
357,589
232,209
Amounts owed by subsidiary undertakings
11,390,242
9,411,065
Other debtors
121
50,550
11,750,494
9,695,617
Amounts falling due after one year:
Amounts owed by participating interests
-
57,000
Total Debtors
11,750,494
9,752,617
Amounts owed by parent and subsidiary undertakings are unsecured, have no fixed repayment terms and do not bear interest.
14
Creditors: amounts falling due within one year
2024
2023
£
£
Bank loans and overdrafts
-
38,413
Trade creditors
31,282
6,422
Amounts owed to parent
15,088,003
12,088,187
Amounts owed to group undertakings
168,957
243,870
Other taxation and social security
25,631
154,160
Other creditors
16,015
13,659
Accruals and deferred income
1,020
-
15,330,908
12,544,711
Amounts owed to parent and group undertakings are unsecured, have no fixed repayment terms and do not bear interest.
- 22 -
BANCON GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2024
15
Retirement benefit schemes
The company operates a defined contribution pension scheme for all qualifying employees. 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 is disclosed within note 5. At the balance sheet date there was £14,156 payable to the fund and included within creditors (2023: £6,547).
16
Share capital
2024
2023
£
£
Ordinary share capital
Issued and fully paid
665 ordinary shares of £1 each
665
665
The share capital account records the nominal value of shares issued. The ordinary shares carry equal voting rights and no right to fixed income.
17
Reserves
The company's profit and loss reserve represents the cumulative historic profits and losses, net of dividends and other adjustments.
18
Financial commitments, guarantees and contingent liabilities
All group companies are party to a cross-company guarantee in respect of bank facilities offered to Bancon Developments Holdings Limited group.
19
Controlling party
The immediate and ultimate parent undertaking and controlling party is Bancon Developments Holdings Limited, a company registered in Scotland.
Bancon Developments Holdings Limited is the parent undertaking of the smallest and largest group of undertakings to consolidate these financial statements at 31 March 2024. The consolidated financial statements of Bancon Developments Holdings Limited are available from UK Companies House. A copy of its financial statements may be obtained from UK Companies House.
The directors regard J C A Burnett of Leys and his family to be the ultimate controlling party by virtue of their individual shareholdings in Bancon Development Holdings Limited.
- 23 -
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