Company registration number 3385920 (England and Wales)
BENCHLEVEL DEVELOPMENTS LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
PAGES FOR FILING WITH REGISTRAR
BENCHLEVEL DEVELOPMENTS LIMITED
CONTENTS
Page
Statement of financial position
1
Notes to the financial statements
2 - 7
BENCHLEVEL DEVELOPMENTS LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2023
31 December 2023
- 1 -
2023
2022
Notes
£
£
£
£
Fixed assets
Investment properties
4
11,650,000
10,775,000
Investments
5
301
301
11,650,301
10,775,301
Current assets
Debtors
6
11,451,029
11,583,820
Cash at bank and in hand
9,531
29,784
11,460,560
11,613,604
Creditors: amounts falling due within one year
7
(17,434,977)
(17,414,131)
Net current liabilities
(5,974,417)
(5,800,527)
Total assets less current liabilities
5,675,884
4,974,774
Provisions for liabilities
(1,013,015)
(794,265)
Net assets
4,662,869
4,180,509
Capital and reserves
Called up share capital
9
2
2
Investment property revaluation reserve
4,428,126
3,771,876
Profit and loss reserves
234,741
408,631
Total equity
4,662,869
4,180,509
The directors of the company have elected not to include a copy of the income statement within the financial statements.true
These financial statements have been prepared and delivered 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 20 December 2024 and are signed on its behalf by:
G H Hedger
Director
Company Registration No. 3385920
BENCHLEVEL DEVELOPMENTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023
- 2 -
1
Accounting policies
Company information
Benchlevel Developments Limited is a private company limited by shares and is incorporated and domiciled in England. The registered office address is 2 Leman Street, London, United Kingdom, E1W 9US.
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, modified to include investment properties at fair value. The principal accounting policies adopted are set out below.
The company has taken advantage of the exemption under section 399 of the Companies Act 2006 not to prepare consolidated accounts, on the basis that the group of which this is the parent qualifies as a small group. The financial statements present information about the company as an individual entity and not about its group.
1.2
Going concern
The financial statements have been prepared on a going concern basis even though at the balance sheet date the company's current liabilities exceeded its current assets by £true5,974,417.
The directors consider the going concern basis to be appropriate because, in their opinion, the company will continue to obtain sufficient funding from fellow group companies and if required from other connected companies under common control, to enable it to pay its debts as they fall due for at least 12 months from the date of approval of these financial statements.
1.3
Turnover
Turnover represents rent receivable from investment properties net of VAT. Rent receivable from tenants are measured at fair value. Rental income is recognised in the period to which it arises on an accrual basis and in accordance with the terms of the lease.
1.4
Investment properties
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. The surplus or deficit on revaluation is recognised in the income statement.
The fair value model is determined by the directors with the benefit of professional external valuers and derived from the current market rents and investment property yields for comparable real estate, adjusted if necessary for any difference in the nature, location or condition of the specific asset.
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.
BENCHLEVEL DEVELOPMENTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 3 -
1.6
Cash and cash equivalents
Cash at bank and in hand are basic financial assets and include cash in hand.
1.7
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ of FRS 102 to all of its financial instruments.
Financial instruments are recognised in the company's statement of financial position when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include 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 and loans from fellow group companies, 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.
1.8
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.
1.9
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 income statement 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.
BENCHLEVEL DEVELOPMENTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
1
Accounting policies
(Continued)
- 4 -
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 income statement, 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.
1.10
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.
1.11
Leases
Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.
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.
Key sources of estimation uncertainty
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.
Investment Properties
Investment properties are measured at fair value with any movement in valuation at the year-end being taken to profit or loss. The Directors have made key assumptions with the benefit of professional external valuers in the determination of the value of an investment property. The valuation was arrived at by reference to market evidence of transaction prices of similar properties in its location, together with a review of property rental yields.
BENCHLEVEL DEVELOPMENTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 5 -
3
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Total
6
6
4
Investment property
2023
£
Fair value
At 1 January 2023
10,775,000
Revaluations
875,000
At 31 December 2023
11,650,000
No depreciation is provided in respect of these properties.
On a historical cost basis the investment properties would have been included at an original cost of £6,208,858 (2022 - £6,208,858).
5
Fixed asset investments
2023
2022
£
£
Shares in group undertakings and participating interests
301
301
6
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
112,565
143,181
Amounts owed by group undertakings
5,671,581
5,789,916
Other debtors
5,666,883
5,650,723
11,451,029
11,583,820
BENCHLEVEL DEVELOPMENTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 6 -
7
Creditors: amounts falling due within one year
2023
2022
£
£
Bank loan
5,000,000
5,000,000
Amounts owed to group undertakings
11,942,364
11,960,365
Taxation and social security
32,632
71,194
Other creditors
459,981
382,572
17,434,977
17,414,131
The bank loan is secured by fixed and floating charges over one of the investment properties held by the company and the investment properties of one of its subsidiary companies.
The loan is repayable by January 2024, with interest payable at a rate of 2.25% per annum over LIBOR. The loan agreement includes a covenant requiring that the ratio of net rental income to interest payable must be at least 2:1 for each financial year. The company failed to meet this interest cover covenant for the year ended 31 December 2023. However, subsequent to the year-end, the bank approved a loan refinancing, which remedied the covenant breach as of the year-end.
After the year-end, the directors finalised the loan refinancing with different terms. This refinancing consolidates this loan with other group company loans, resulting in a reduced covenant ratio, requiring the net rental income to interest payable to be at least 1.25:1 (see note 13).
8
Provisions for liabilities
2023
2022
£
£
Deferred tax liabilities
1,013,015
794,265
9
Called up share capital
2023
2022
2023
2022
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
2
2
2
2
10
Audit report information
As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:
The auditor's report was unqualified.
The senior statutory auditor was Jean-Francois Lefort FCA.
The auditor was Gravita II LLP.
BENCHLEVEL DEVELOPMENTS LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2023
- 7 -
11
Financial commitments, guarantees and contingent liabilities
The company has given a guarantee supported by a fixed and floating charge over some of its assets to secure the borrowings of its parent company Benchlevel Properties Limited. At the balance sheet date Benchlevel Properties Limited's indebtedness in respect of this guarantee was £53,037,500 (2022: £53,587,500).
12
Related party transactions
Transactions with related parties
The company has taken advantage of the exemption available under section 1AC.35 of FRS 102 "Related party disclosures" whereby it has not disclosed transactions with the ultimate parent company or any wholly owned subsidiary undertaking of the group.
Recharge costs
2023
2022
£
£
Other related parties
223,514
212,659
The following amounts were outstanding at the reporting end date:
2023
Balance
Amounts owed by related parties
£
Other related parties
5,616,226
2022
Balance
Amounts owed in previous period
£
Other related parties
5,621,298
13
Events after the reporting date
The £5 million bank loan was redeemed on 16 January 2024. A new bank loan of £11.8m with different terms was advanced to the company to pay off existing indebtedness of bank loans of three fellow group companies. The fellow group companies have given the relevant securities and guarantees to the company to secure the new bank loan.
14
Parent company
The ultimate parent company is Benchlevel Properties Limited and its registered office is 2 Leman Street, London, E1W 9US.