Company registration number 05598526 (England and Wales)
IIC BY EDUCATION (PETERBOROUGH SCHOOLS) LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
IIC BY EDUCATION (PETERBOROUGH SCHOOLS) LIMITED
COMPANY INFORMATION
Directors
JS Gordon
PR Hepburn
PK Johnstone
(Appointed 19 December 2023)
Secretary
Resolis Limited
Company number
05598526
Registered office
1 Park Row
Leeds
United Kingdom
LS1 5AB
Auditor
Johnston Carmichael LLP
Bishop's Court
29 Albyn Place
Aberdeen
AB10 1YL
IIC BY EDUCATION (PETERBOROUGH SCHOOLS) LIMITED
CONTENTS
Page
Directors' report
1 - 2
Independent auditor's report
3 - 6
Statement of comprehensive income
7
Balance sheet
8
Statement of changes in equity
9
Notes to the financial statements
10 - 17
IIC BY EDUCATION (PETERBOROUGH SCHOOLS) LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2024
- 1 -
The directors present their annual report and financial statements for the year ended 30 June 2024.
Principal activities
The principal activity of the Company is the design, construction and facilities management operation of one new secondary school and the refurbishment and extension and facilities management of two further schools under a private finance initiative ("PFI") with Peterborough City Council. The construction works were completed in September 2007. The directors are not aware, at the date of this report, of any likely major changes in the Company's activities in the next year.
The directors have reviewed the activities of the business for the year and the position as at 30 June 2024 and consider them to be satisfactory.
The concession is due to expire in 2037; the Company intends to continue to comply with its obligations under the PFI agreement until this date.
Going concern
The directors have prepared a detailed model forecast to project completion incorporating the relevant terms of the PFI contract, Subcontracts and Credit Agreement and reasonably prudent economic assumptions. This forecast and associated business model, which is updated regularly, predicts that the company will remain profitable and will have sufficient cash resources to operate within the terms of the PFI contract, Subcontract and Credit Agreement. Therefore, the directors, having considered the financial position of the company and its expected future cash flows, for at least 12 months from the date of signing the accounts, and have prepared the financial statements on a going concern basis. The directors confirm that they do not intend to liquidate the company or cease trading as they consider they have realistic alternatives to doing so.
The directors confirm the completeness of the information provided regarding events and conditions relating to going concern at the date of approval of the financial statements, including plans for future actions.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
JS Gordon
J McDonagh
(Resigned 19 December 2023)
PR Hepburn
PK Johnstone
(Appointed 19 December 2023)
Auditor
The auditor, Johnston Carmichael LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
IIC BY EDUCATION (PETERBOROUGH SCHOOLS) LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 2 -
Statement of directors' responsibilities
The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
make judgements 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 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.
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.
Small companies exemption
This report has been prepared in accordance with the provisions applicable to companies entitled to the small companies exemption.
On behalf of the board
PR Hepburn
Director
13 December 2024
IIC BY EDUCATION (PETERBOROUGH SCHOOLS) LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF IIC BY EDUCATION (PETERBOROUGH SCHOOLS) LIMITED
- 3 -
Opinion
We have audited the financial statements of IIC By Education (Peterborough Schools) Limited (the 'company') for the year ended 30 June 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 FRS 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 30 June 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.
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's 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 Director with respect to going concern are described in the relevant sections of this report.
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 our audit:
The information given in the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
The Directors' Report have been prepared in accordance with applicable legal requirements.
IIC BY EDUCATION (PETERBOROUGH SCHOOLS) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF IIC BY EDUCATION (PETERBOROUGH SCHOOLS) LIMITED
- 4 -
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 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.
• 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 and from the requirement to prepare a Strategic Report.
Responsibilities of directors
As explained more fully in the Directors' responsibilities statement set out on page 2, the Directors 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's 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 is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
Extent the audit was 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.
IIC BY EDUCATION (PETERBOROUGH SCHOOLS) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF IIC BY EDUCATION (PETERBOROUGH SCHOOLS) LIMITED
- 5 -
We obtained an understanding of the legal and regulatory frameworks that are applicable to company and the sector in which it operates, focusing on 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:
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 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:
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 assessing judgements made by management in their calculation of accounting estimates for potential management bias;
Recalculating the unitary charge received by taking the base charge per the project agreement and uplifting for RPI;
Agreeing a sample of income receipts to supporting documents and bank statements;
Performing an assessment on the service margins used in the year and agreeing margins used to the active financial models;
Reconciling the finance income and amortisation to the finance debtor reconciliation to ensure allocation methodology is in line with contractual terms and relevant accounting standards;
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 are to become aware of it.
IIC BY EDUCATION (PETERBOROUGH SCHOOLS) LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF IIC BY EDUCATION (PETERBOROUGH SCHOOLS) LIMITED
- 6 -
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.
Jenny Junnier
Senior Statutory Auditor
For and on behalf of Johnston Carmichael LLP
13 December 2024
Chartered Accountants
Statutory Auditor
Bishop's Court
29 Albyn Place
Aberdeen
AB10 1YL
IIC BY EDUCATION (PETERBOROUGH SCHOOLS) LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2024
- 7 -
2024
2023
Notes
£
£
Turnover
7,909,580
7,611,027
Cost of sales
(6,514,871)
(6,339,733)
Gross profit
1,394,709
1,271,294
Administrative expenses
(828,228)
(734,412)
Operating profit
566,481
536,882
Interest receivable and similar income
2,129,859
2,105,938
Interest payable and similar expenses
5
(1,812,431)
(1,882,581)
Profit before taxation
883,909
760,239
Tax on profit
6
(221,933)
(156,427)
Profit for the financial year
661,976
603,812
Other comprehensive income
Cash flow hedges (loss)/gain arising in the year
(1,019,988)
4,384,737
Tax relating to other comprehensive income
254,997
(1,096,183)
Total comprehensive income for the year
(103,015)
3,892,366
The profit and loss account has been prepared on the basis that all operations are continuing operations.
IIC BY EDUCATION (PETERBOROUGH SCHOOLS) LIMITED
BALANCE SHEET
AS AT 30 JUNE 2024
30 June 2024
- 8 -
2024
2023
Notes
£
£
£
£
Current assets
Debtors falling due after more than one year
8
31,229,210
32,652,053
Debtors falling due within one year
8
2,957,635
1,728,339
Investments
9
3,050,000
Cash at bank and in hand
5,135,769
37,236,845
39,516,161
Creditors: amounts falling due within one year
12
(9,258,385)
(10,728,776)
Net current assets
27,978,460
28,787,385
Creditors: amounts falling due after more than one year
13
(28,131,470)
(28,224,340)
Net (liabilities)/assets
(153,010)
563,045
Capital and reserves
Called up share capital
15
50,000
50,000
Hedging reserve
17
(932,150)
(167,159)
Profit and loss reserves
729,140
680,204
Total equity
(153,010)
563,045
These financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.
The financial statements were approved by the board of directors and authorised for issue on 13 December 2024 and are signed on its behalf by:
PR Hepburn
Director
Company registration number 05598526 (England and Wales)
IIC BY EDUCATION (PETERBOROUGH SCHOOLS) LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2024
- 9 -
Share capital
Hedging reserve
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 July 2022
50,000
(3,455,713)
328,476
(3,077,237)
Year ended 30 June 2023:
Profit
-
-
603,812
603,812
Other comprehensive income:
Cash flow hedges gains
-
4,384,737
-
4,384,737
Tax relating to other comprehensive income
-
(1,096,183)
(1,096,183)
Total comprehensive income
-
3,288,554
603,812
3,892,366
Dividends
7
-
-
(252,084)
(252,084)
Balance at 30 June 2023
50,000
(167,159)
680,204
563,045
Year ended 30 June 2024:
Profit
-
-
661,976
661,976
Other comprehensive income:
Cash flow hedges gains
-
(1,019,988)
-
(1,019,988)
Tax relating to other comprehensive income
-
254,997
254,997
Total comprehensive income
-
(764,991)
661,976
(103,015)
Dividends
7
-
-
(613,040)
(613,040)
Balance at 30 June 2024
50,000
(932,150)
729,140
(153,010)
IIC BY EDUCATION (PETERBOROUGH SCHOOLS) LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
- 10 -
1
Accounting policies
Company information
IIC By Education (Peterborough Schools) Limited is a private company limited by shares incorporated in England and Wales. The registered office is 1 Park Row, Leeds, United Kingdom, LS1 5AB.
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 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
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 £.
The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
1.2
Going concern
The shareholders funds at 30 June 2024 show a truedeficit of £153,010 (2023: surplus £563,045). This arises from the early phase in the Company's 31 year concession period, and the recognition of the Company's swap liability at fair value. The Company has a secured bank facility that will enable it continue trading for the life of the concession period. The Company is not in breach of its covenant terms and does not expect to become so in the foreseeable future. The directors have reviewed the forecast and believe that the financial position will strengthen in the future and therefore consider it is appropriate to prepare these financial statements on a going concern basis.
1.3
Finance debtor and revenue recognition
The Company has taken the transition exemption in FRS 102 section 35.10(i) that allows the Company to continue the service concession arrangement accounting policies from previous UK GAAP. The Company is accounting for the concession asset based on the ability to substantially transfer all the risks and rewards of ownership to the customer, with this arrangement the costs incurred by the Company on the design and construction of the asset have been treated as a finance debtor within these financial statements.
Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.
1.4
Cash and cash equivalents
Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, 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.
1.5
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.
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.
IIC BY EDUCATION (PETERBOROUGH SCHOOLS) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
1
Accounting policies
(Continued)
- 11 -
Basic financial assets
Basic financial assets, which include debtors 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. Financial assets classified as receivable within one year are not amortised.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, 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.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.
1.6
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
1.7
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.
IIC BY EDUCATION (PETERBOROUGH SCHOOLS) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
1
Accounting policies
(Continued)
- 12 -
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
1.8
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation in the period are included in profit or loss.
2
Judgements and key sources of estimation uncertainty
The preparation of financial statements in conformity with FRS 102 requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets, liabilities, income and expenses. The estimates and associated assumptions are based upon historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making judgements about carrying values of assets and liabilities that are not readily available from other sources. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period or in the period of revision and future periods if the revision affects both current and future periods.
The Company uses derivative financial instruments to hedge certain economic exposures in relation to movements in interest rates as compared with the position that was expected at the date the underlying transaction being hedged was entered into. The Company fair values its derivative financial instruments and records the fair value of those on its balance sheet. The fair value of the interest rate swaps is based on broker quotes. Those quotes are tested for reasonableness by discounting estimated future cash flows based on the terms of maturity of each contract and using market interest rates for a similar instrument at the measurement date.
Accounting for the service contracts and finance receivables requires estimation of service margins, finance receivable interest rates and finance receivable amortisation profile which is based on forecasted results of the PFI contract.
3
Auditor's remuneration
2024
2023
Fees payable to the company's auditor and associates:
£
£
For audit services
Audit of the financial statements of the company
21,235
20,035
IIC BY EDUCATION (PETERBOROUGH SCHOOLS) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 13 -
4
Staff costs and Directors' remuneration
The directors, who are key management personnel, received £nil (2023: £nil) in respect of their services to the Company during the year. The Company had no employees during the year (2023: nil). Fees paid to investors in respect of their directors amount to £137,443 (2023: £124,553).
5
Interest payable and similar expenses
2024
2023
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
1,793,411
1,032,495
Interest payable to group undertakings
309,532
313,981
2,102,943
1,346,476
Other finance costs:
Finance costs for financial instruments measured at fair value through profit or loss
(290,512)
536,105
1,812,431
1,882,581
6
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
221,980
156,427
Deferred tax
Origination and reversal of timing differences
(47)
Total tax charge
221,933
156,427
In addition to the amount charged to the profit and loss account, the following amounts relating to tax have been recognised directly in other comprehensive income:
2024
2023
£
£
Reclassifications from equity to profit or loss:
Relating to cash flow hedges
(254,997)
1,096,183
7
Dividends
2024
2023
£
£
Final paid
613,040
252,084
IIC BY EDUCATION (PETERBOROUGH SCHOOLS) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 14 -
8
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
1,157,460
83,144
Amounts owed by group undertakings
122,131
117,388
Finance asset receivable
1,555,621
1,465,674
Prepayments and accrued income
122,423
62,133
2,957,635
1,728,339
2024
2023
Amounts falling due after more than one year:
£
£
Amounts owed by group undertakings
2,014,805
2,136,936
Finance asset receivable
28,903,638
30,459,395
30,918,443
32,596,331
Deferred tax asset
310,767
55,722
31,229,210
32,652,053
Total debtors
34,186,845
34,380,392
9
Current asset investments
2024
2023
£
£
Other investments
3,050,000
10
Cash at bank
Cash at bank includes thirteen current accounts with Royal Bank of Scotland having an overdrawn balance of £10,826 (2023: £5,135,769). The restricted cash balance, which includes £3,050,000 held on deposit, is £3,143,232 (2023: £3,661,756). Withdrawals from these restricted bank accounts are restricted to items set out in the Credit Agreement with Royal Bank of Scotland and the Company must satisfy certain requirements before being permitted to withdraw any amounts from these accounts.
The overdrawn bank balance is a timing difference at 30 June 2024 due to late receipt of Unitary Charge Payment owed to IIC By Education (Peterborough Schools) Limited.
IIC BY EDUCATION (PETERBOROUGH SCHOOLS) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 15 -
11
Financial instruments
(a) Financial instruments measured at fair value
Derivative financial instruments
The fair value of interest rate swaps is based on broker quotes. Those are tested for reasonableness by discounting estimated future cash flows based on the terms and maturity of each contract and using market interest rates for a similar instrument at the measurement date.
(b) Hedge accounting
Derivative financial instruments designated as hedges of variable interest rate risk comprise of an interest rate swap.
To hedge potential movement in the interest cash flows associated with the SONIA rate used for the bank term loan described in note 14, the Company has entered into a floating to fixed interest rate swaps with a nominal vale equal to the initial borrowings with the same term as the loans and interest payment dates. These result in the Company paying 4.8975% per annum and receiving SONIA.
The Group's borrowings are linked to SONIA and the Group has entered into several interest rate swaps to restrict its exposure to future interest rate fluctuations.
12
Creditors: amounts falling due within one year
2024
2023
£
£
Bank loans and overdrafts
14
1,065,310
1,073,472
Other borrowings
14
121,611
63,000
Trade creditors
135,867
896,359
Corporation tax
137,063
61,758
Other taxation and social security
192,732
156,597
Deferred income
6,904,440
7,586,000
Accruals and deferred income
701,362
891,590
9,258,385
10,728,776
13
Creditors: amounts falling due after more than one year
2024
2023
Notes
£
£
Bank loans and overdrafts
14
24,479,960
25,534,321
Other borrowings
14
2,408,640
2,467,136
Derivative financial instruments
1,242,870
222,883
28,131,470
28,224,340
Amounts included above which fall due after five years are as follows:
Payable by instalments
18,512,052
19,423,052
IIC BY EDUCATION (PETERBOROUGH SCHOOLS) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 16 -
14
Loans and overdrafts
2024
2023
£
£
Bank loans
25,534,444
26,607,793
Bank overdrafts
10,826
Loans from group undertakings and related parties
2,530,251
2,530,136
28,075,521
29,137,929
Payable within one year
1,186,921
1,136,472
Payable after one year
26,888,600
28,001,457
The Company has fully drawn on the term of loan facility (A Loan). The Company has undrawn committed borrowing facilities of £1,645,395 (2023: £1,645,395) on the change in law loan facility (C Loan). All facilities expire on 31 August 2036.
The term loan has a variable rate of Sonia plus a margin of 0.80%. The Company manages all exposure to interest risk on external loans by entering into interest rate SWAPS.
The term loan is secured, in favour of the Royal Bank of Scotland PLC, The Royal Bank of Canada and NIB Capital Bank N.V., over all assets of the Company. There is also a legal mortgage of shares in the Company owned by shareholders in favour of Royal Bank of Scotland Plc and Royal Bank of Canada as security for the payment of all obligations and liabilities owed by the Company to Royal Bank of Scotland Plc and Royal Bank of Canada.
On 31 July 2006, the Company issued £5,100,000 of unsecured loan stock due in 2037. At balance sheet date, 100% of the loan stock is subscribed for by IIC Peterborough Subdebt Limited.
Since the project became operational, subject to certain terms and conditions, the loan stock has an interest rate of 12.11% (2023: 12.11%).
15
Called up share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
50,000
50,000
50,000
50,000
The Company's share capital is divided between 40,500 "A" Ordinary £1 shares and 9,500 "B" Ordinary £1 shares. All these shares rank pari passu to each other.
16
Profit and loss reserve
The profit and loss reserve contains the retained earnings carried forward net of distributions to owners.
17
Hedging reserve
The hedge reserve comprises the effective portion of the cumulative net change in the fair value of cash flow hedging instruments related to hedged transactions that have not yet occurred.
IIC BY EDUCATION (PETERBOROUGH SCHOOLS) LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 17 -
18
Related party transactions
At the balance sheet date the Company was a wholly owned subsidiary of Jura Acquisition Limited and has applied the exemption, available under the terms of FRS 102 section 33 paragraphs 33.1A from disclosing related party transactions with entities that are part of the group headed by Jura Acquisition Limited.
There were no related party transactions entered into by the Company during the year.
19
Parent company
The Company's ultimate parent is Jura Acquisition Limited, a Guernsey registered company, and a subsidiary of Jura Holdings Limited owned by a consortium jointly led by funds managed by Dalmore Capital Limited and Equitix Investment Management Limited. The Directors regard Jura Holdings Limited as the ultimate parent of the Company. Copies of the financial statements are available from the Guernsey registry website. The Directors consider that there is no ultimate controlling entity.
The head of the largest and smallest group for which consolidated financial statements are prepared and of which the Company is a member is IIC Peterborough Holding Company Limited. the consolidated financial statements of this group are available to the public and may be obtained from the Company Secretary, 1 Park Row, Leeds, England, LS1 5AB.
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