The members present their annual report and financial statements for the year ended 31 March 2024.
James Watt Dock Limited Liability Partnership (LLP) was established by Peel Land and Property (James Watt Dock) Limited and Riverside Inverclyde (Property Holdings) Limited to advance the redevelopment of a 107 acre site to the east of Greenock town centre. Its principal objectives are to:
1. accelerate the comprehensive redevelopment of a key waterfront regeneration site through the remediation of brownfield land and the redevelopment of an “A” listed building; and
2. the remediation of the land in such a way as to create profit for Peel Land and Property (James Watt Dock) Limited and Riverside Inverclyde (Property Holdings) Limited and to create a sustainable work/live community at James Watt Dock.
Activities
1. Since the establishment of the LLP in November 2008, the Board and Project Management Team have met regularly and work has been completed on the first phase development of the wider site;
2. The wind and watertight works to the Sugar Warehouse completed in November 2009 and since September 2010 Riverside Inverclyde has been able to open the building to the public for tours and stage events within the sheds. The successful Tall Ships 2011 event was based in the James Watt Dock area with the Sugar Sheds being used as a base for entertainment events;
3. A new road access has been completed and the bridge over the A8 to the south side of the site has been removed;
4. Installation of the first phase of the marina has been completed and the management company appointed to operate the facility started trading in August 2011. A full range of berthing and land based storage and ancillary marina services is offered. A management contract to operate the marina was granted in 2011; further additional pontoons have been installed and activity has increased year on year in line with the 5 year plan. Public realm works around the entrance to the marina have been completed. Installation of a further 60.4 metres of pontoons was completed in June 2015. Engineering work on the design of the replacement of Garvel Bridge is complete and the replacement project along with new road is now under construction;
5. The LLP has continually been reviewing the master plan for the area; and
6. In January 2017, following a full tender process, the marina was leased to a new tenant on a 60 year ground lease which requires the tenant to undertake the expansion of the marina and provision of a marina services building (incorporating offices, showers, café bar etc) within agreed timescales.
The loss for the year amounted to £2,348,426 (2023: £829,944 profit).
The profit is allocated equally between the Members based on Clause 15.1.1 of the LLP Agreement.
The auditor, Azets Audit Services, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
The members who served during the year and up to the date of approval were:
Peel Land and Property (James Watt Dock) Limited
Riverside Inverclyde (Property Holdings) Limited
The board members of the partnership during the year and up to the date of approval were James Whittaker, Stuart Jamieson, Stephen Frew and Brian Lavalette.
Members’ capital requirements are determined from time to time by the members. Unanimous agreement is required if additional capital is required, and the required capital shall be contributed by the members in equal proportions, or in such other proportions as the members may otherwise unanimously agree. No capital shall be withdrawn by any member without the unanimous consent of all other members.
Further funding requirements of the LLP will be determined by the members as and when required.
Following settlement of unsecured creditor balances, the Riverside Priority Distribution amount, and accrued loan interest remaining unpaid, any remaining assets will be used towards settlement of the loans due to members on an equal basis.
This report has been prepared in accordance with the special provisions relating to small LLPs within Part 15 of the Companies Act 2006.
The members are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.
Company law (as applied by The Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008) requires the members to prepare financial statements for each financial year. Under that law the members have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice. Under company law (as applied by The Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008) the members 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 limited liability partnership and of the profit or loss of the limited liability partnership for that period. In preparing these financial statements, the members 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 limited liability partnership will continue in business.
The members are responsible for keeping adequate accounting records that are sufficient to show and explain the limited liability partnership’s transactions and disclose with reasonable accuracy at any time the financial position of the limited liability partnership and enable them to ensure that the financial statements comply with the Companies Act 2006 (as applied by The Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008). They are also responsible for safeguarding the assets of the limited liability partnership and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
We have audited the financial statements of James Watt Dock LLP (the 'limited liability partnership') for the year ended 31 March 2024 which comprise the profit and loss account, the balance sheet, the reconciliation of members' interests 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).
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's responsibilities for the audit of the financial statements section of our report. We are independent of the limited liability partnership 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 members' 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 limited liability partnership’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 members 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 members 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.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 as applied to limited liability partnerships 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
we have not received all the information and explanations we require for our audit; or
the members were not entitled to prepare the financial statements in accordance with the small limited liability partnerships regime.
As explained more fully in the members' responsibilities statement, the members 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 members 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 members are responsible for assessing the limited liability partnership'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 members either intend to liquidate the limited liability partnership or to cease operations, or have no realistic alternative but to do so.
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 to which 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 and on the Financial Reporting Council’s website, to detect material misstatements in respect of irregularities, including fraud.
We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework. Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.
In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included:
Enquiry of management and those charged with governance around actual and potential litigation and claims as well as actual, suspected and alleged fraud;
Reviewing minutes of meetings of those charged with governance;
Assessing the extent of compliance with the laws and regulations considered to have a direct material effect on the financial statements or the operations of the entity through enquiry and inspection;
Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations;
Performing audit work over the risk of management bias and 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 accounting estimates for indicators of potential bias.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Use of our report
This report is made solely to the limited liability partnership's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006 as applied by the Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008. Our audit work has been undertaken so that we might state to the limited liability partnership'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 limited liability partnership and the limited liability partnership's members as a body, for our audit work, for this report, or for the opinions we have formed.
The profit and loss account has been prepared on the basis that all operations are continuing operations.
The notes on pages 11 to 17 form part of these financial statements.
James Watt Dock LLP is a limited liability partnership incorporated in Scotland. The registered office is 16 Robertson Street, Glasgow, Lanarkshire, G2 8DS.
The limited liability partnership's principal activities are disclosed in the Members' Report.
These financial statements have been prepared in accordance with the Statement of Recommended Practice "Accounting by Limited Liability Partnerships" issued in December 2021, together 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 limited liability partnership. Monetary amounts in these financial statements are rounded to the nearest £.
The financial statements have been prepared under the historical cost convention, modified to include the revaluation of assets acquired for development and to include investment properties at fair value. The principal accounting policies adopted are set out below.
The members are required to prepare the financial statements on the going concern basis unless it is inappropriate to presume that the LLP will continue in business.
The members recognise that income from external sources may be required in the medium to long term to deliver the major elements of the project plan, though this may be achieved through the sale of development plots. The members further note that the Limited Liability Partnership Agreement is only in place until November 2025. The members have confirmed in writing that it is their present intention to extend the Agreement, as they have done previously, and to continue to provide support to the LLP beyond the expiry date of the current agreement for a period of at least 12 months from the date of approval of these financial statements. Accordingly, the members are satisfied that the LLP has adequate resources to continue in business for the foreseeable future.
Taking all of the above into consideration, the members continue to prepare the financial statements on the going concern basis.
Turnover represents rental income receivable and operational income from the marina, excluding VAT.
Turnover is recognised to the extent that it is probable that the economic benefits will flow to the LLP and the revenue can be reliably measured. Turnover is measured as the fair value of the consideration received or receivable, excluding discounts, rebates and VAT. The following criteria must also be met before turnover is recognised:
Rental income from operating leases is recognised in the Statement of Comprehensive Income on a straight-line basis over the term of the relevant lease.
Members' participation rights are the rights of a member against the LLP that arise under the members' agreement (for example, in respect of amounts subscribed or otherwise contributed remuneration and profits).
Members' participation rights in the earnings or assets of the LLP are analysed between those that are, from the LLP's perspective, either a financial liability or equity, in accordance with section 22 of FRS 102. A member's participation rights including amounts subscribed or otherwise contributed by members, for example members' capital, are classed as liabilities unless the LLP has an unconditional right to refuse payment to members, in which case they are classified as equity.
All amounts due to members that are classified as liabilities are presented within 'Loans and other debts due to members' and, where such an amount relates to current year profits, they are recognised within ‘Members' remuneration charged as an expense’ in arriving at the relevant year’s result. Undivided amounts that are classified as equity are shown within ‘Members' other interests’. Amounts recoverable from members are presented as debtors and shown as amounts due from members within members’ interests.
Where there exists an asset and liability component in respect of an individual member’s participation rights, they are presented on a gross basis unless the LLP has both a legally enforceable right to set off the recognised amounts, and it intends either to settle on a net basis or to settle and realise these amounts simultaneously, in which case they are presented net.
Once an unavoidable obligation has been created in favour of members through allocation of profits or other means, any undrawn profits remaining at the reporting date are shown as ‘Loans and other debts due to members’ to the extent they exceed debts due from a specific member.
Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
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:
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 recognised in the profit and loss account.
Investment property, which is property held to earn rentals and/or for capital appreciation, is initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Subsequently it is measured at fair value at the reporting end date. Changes in fair value are recognised in profit or loss
At each reporting period end date, the limited liability partnership 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). Where it is not possible to estimate the recoverable amount of an individual asset, the limited liability partnership estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
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.
The limited liability partnership 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 limited liability partnership's statement of financial position when the limited liability partnership becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset and 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, 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.
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.
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the limited liability partnership transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
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 limited liability partnership after deducting all of its 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.
Financial liabilities are derecognised when the limited liability partnership’s obligations expire or are discharged or cancelled.
Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to make estimates and assumptions which affect reported income, expenses, assets and liabilities. Use of available information and application of judgement are inherent in the formation of estimates, together with past experience and expectations of future events that are believed to be reasonable under the circumstances. Actual results in the future could differ from such estimates.
The members are satisfied that the accounting policies are appropriate and have been applied consistently. Key sources of estimation have been applied to the depreciation rates. Depreciation rates have been deemed to be appropriate for the class of asset. Judgement is also used in determining the fair value of investment properties. The members engage a professionally qualified valuer to undertake this assessment on their behalf on a regular basis, and assess the fair value themselves in the intervening periods.
The average number of persons (excluding members) employed by the partnership during the year was:
Reversals of previous impairment losses have been recognised in profit or loss as follows:
More information on impairment movements in the year is given in note 5.
The investment property were independently valued at 31 March 2024 by Jones Lang LaSalle Limited. The valuation was carried out in accordance with the Professional Standards, Valuation Technical and Performance Standards contained in the current RICS Valuation - Global Standards.
The members consider the fair value of the assets annually and confirm the above valuation remains a true reflection of the current market conditions.
In the event of a winding up the amounts included in "Loans and other debts due to members" will rank equally with unsecured creditors.
The loans due to members are secured over certain assets owned by the LLP and by bonds and floating charges over all the assets of the LLP. These are held by Riverside Inverclyde (Property Holdings) Limited and Peel Land and Property (James Watt Dock) Limited.
Capital expenditure authorised by the members and contracted for is estimated to amount to £nil (2023: £1,414,236).
Loans due to members comprise £5,601,552 (2023 - £5,532,900) due to Riverside Inverclyde (Property Holdings) Limited and £5,023,594 (2023 - £3,442,073) due to Peel Land and Property (James Watt Dock) Limited. Interest of £145,707 (2023 - £122,735) was payable by the LLP to Peel Land and Property (James Watt Dock) Limited.
Amounts owed to Peel Land and Property (James Watt Dock) Limited are charged interest at a rate of 3.5% per annum (2023 – 3.5%). This interest is treated as added to the loan sum outstanding with settlement due when cash resources become available.
Amounts owed to Riverside Inverclyde (Property Holdings) Limited are charged interest at a rate of 3.5% per annum (2023 – 3.5%). This interest is treated as added to the loan sum outstanding with settlement due when cash resources become available.
Interest of £193,652 (2023 - £187,103) was payable by the LLP to Riverside Inverclyde (Property Holdings) Limited.
Following settlement of unsecured creditor balances, the Riverside Priority Distribution amount, and accrued loan interest remaining unpaid, any remaining assets will be used towards settlement of the loans due to members on an equal basis.
During the year a management charge was applied by Peel Land and Property (James Watt Dock) Limited amounting to £19,786 (2023 - £7,136). At the year end, included within accruals, is the balance owed to Peel Land and Property (James Watt Dock) Limited totalling £86,694 (2023 - £67,509).