Company registration number 08855562 (England and Wales)
MORTON WOOD SOLAR LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
MORTON WOOD SOLAR LIMITED
COMPANY INFORMATION
Directors
N A Wood
K P O'Connor
(Appointed 18 July 2024)
Secretary
FLB Company Secretarial Services Ltd
Company number
08855562
Registered office
1010 Eskdale Road
Winnersh Triangle
Wokingham
Berkshire
RG41 5TS
Independent auditor
KPMG Channel Islands Limited
Glategny Court
Glategny Esplanade
St Peter Port
Guernsey
GY1 1WR
MORTON WOOD SOLAR LIMITED
CONTENTS
Page
Directors' report
1 - 3
Independent auditor's report
4 - 7
Statement of comprehensive income
8
Statement of financial position
9
Statement of changes in equity
10
Statement of cash flows
11
Notes to the financial statements
12 - 23
MORTON WOOD SOLAR LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2024
- 1 -

The directors present their annual report and audited financial statements Morton Wood Solar Limited  (the "Company") for the year ended 30 June 2024.

Principal activities

The principal activity of the Company in the year under review was that of generation of electricity from renewable energy sources which is achieved through the operation of solar photovoltaic installations.

 

Country of incorporation and legal form of the entity

Morton Wood Solar Limited was incorporated as a private company, limited by shares, under the Registrar of Companies for England and Wales on 22 January 2014.

 

Risk management and Control

In the ordinary course of business, the Company is exposed to and manages a variety of risks in relation to its activities, including financial risk. The management of credit, interest rate, liquidity and operational risks are fundamental to the Company, with the Board of directors having responsibility for the overall system of internal control and for reviewing its effectiveness.

 

The key areas of risk in relation to the use of financial statements are listed below and are properly addressed by the management of the Company:

 

Credit risk: Losses due to the inability or unwillingness of a customer to meet its obligations. This is mitigated by the Company entering into price agreements with creditworthy counterparties for the purchase of electricity to be generated by the solar photovoltaic plant.

 

Interest risk: Fluctuations in the prevailing levels of market rates of interest pose a risk to the Company's financial position and cash flow. This is not considered a significant risk to the Company as the interest on intra-group loans is charged at a rate agreed by the parent company and are not subject to interest movements in the market.

 

Liquidity risk: Failure to meet financial obligations in a timely and cost effective manner due to mismatches in the maturity profile of assets and liabilities. The Company closely monitors its cash flow levels and financial obligations to anticipate its future cash commitments.

 

Operational risk: Failure to meet expected levels of generation output due to technical issues affecting performance of the plant. The Company has sought to mitigate this risk by the appointment of Bluefield Services Limited, as its dedicated asset manager, with responsibility for closely monitoring the performance of the plant, ensuring activities conducted by third party contractors are completed in a timely fashion and as required, contractual protections are enforced. The Company also has insurance policies in place that protect against generation loss in situations out of the Company's control.

 

Price risk: The success of the Company is sensitive to future power market pricing, and a major shift in power demand or supply will impact the Company’s ability to meet its financial targets. 64% of the income generated by the Company is linked to power market prices and so in the unlikely event of a major structural shift in power prices due to reduced demand or excess energy supply, there could be an impact on the Company’s earnings. A rolling programme of PPA contract expiries has been implemented to mitigate risk, alongside the fact the Company receives 36% of its income from the government backed ROC regime.

 

Russia/Ukraine conflict risk: The directors are continuously monitoring the impact, if any, that the ongoing conflict in Ukraine may have on the entity and the impact on energy prices across the portfolio. The Company has no direct exposure to either Ukraine or Russia.

Results and dividends

The profit for the year, after taxation, amounted to £92,009 (2023 - £117,486).

No dividends were distributed in the current or prior year.

MORTON WOOD SOLAR LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 2 -
Directors

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

L J B Roberts
(Resigned 18 July 2024)
N A Wood
K P O'Connor
(Appointed 18 July 2024)
Qualifying third party indemnity provisions

The Company has made qualifying third party indemnity provisions for the benefit of its directors during the year following their appointment. These provisions remain in force at the reporting date.

Post reporting date events

There have been no significant events affecting the Company since the year end.

Independent auditor

The auditor, KPMG Channel Islands Limited, has indicated its willingness to continue in office and will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

Statement of directors' responsibilities

The directors are responsible for preparing the Directors' Report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the Directors to prepare financial statements for each financial year. Under that law they have elected to prepare the financial statements in accordance with UK accounting standards and applicable law (UK Generally Accepted Accounting Practice), including FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland.

 

Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period. In preparing the financial statements, the Directors are required to:

 

 

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 responsible for such internal control as they determine necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error, and have general responsibility for taking such steps as are reasonably open to them to safeguard the assets of the Company and to prevent and detect 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.

MORTON WOOD SOLAR LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 3 -
Small companies

In preparing the financial statements, the directors have taken advantage of section 414B of the Companies Act 2006 and have not prepared a Strategic Report.

On behalf of the board
N A Wood
Director
16 December 2024
MORTON WOOD SOLAR LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF MORTON WOOD SOLAR LIMITED
- 4 -
Our opinion

We have audited the financial statements of Morton Wood Solar Limited (the “Company”), which comprise the statement of financial position as at 30 June 2024, the statements of comprehensive income, changes in equity and cash flows for the year then ended, and notes, comprising significant accounting policies and other explanatory information.

In our opinion, the accompanying financial statements:

 

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”) and applicable law. Our responsibilities are described below. We have fulfilled our ethical responsibilities under, and are independent of the Company in accordance with, UK ethical requirements including FRC Ethical Standards. We believe that the audit evidence we have obtained is a sufficient and appropriate basis for our opinion.

Going concern

The directors have prepared the financial statements on the going concern basis as they do not intend to liquidate the Company or to cease its operations, and as they have concluded that the Company's financial position means that this is realistic. They have also concluded that there are no material uncertainties that could have cast significant doubt over its ability to continue as a going concern for at least a year from the date of approval of the financial statements (the “going concern period").

In our evaluation of the directors' conclusions, we considered the inherent risks to the Company's business model and analysed how those risks might affect the Company's financial resources or ability to continue operations over the going concern period.

Our conclusions based on this work:

 

However, as we cannot predict all future events or conditions and as subsequent events may result in outcomes that are inconsistent with judgements that were reasonable at the time they were made, the above conclusions are not a guarantee that the Company will continue in operation.

MORTON WOOD SOLAR LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF MORTON WOOD SOLAR LIMITED
- 5 -

Fraud and breaches of laws and regulations – ability to detect

Identifying and responding to risks of material misstatement due to fraud

To identify risks of material misstatement due to fraud (“fraud risks”) we assessed events or conditions that could indicate an incentive or pressure to commit fraud or provide an opportunity to commit fraud. Our risk assessment procedures included:

 

 

As required by auditing standards, and taking into account possible incentives or pressures to misstate performance and our overall knowledge of the control environment, we perform procedures to address the risk of management override of controls and the risk of fraudulent revenue recognition, and the risk that management may be in a position to make inappropriate accounting entries. We did not identify any additional fraud risks.

 

We performed procedures including:

 

.

Identifying and responding to risks of material misstatement due to non-compliance with laws and regulations

 

We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our general sector experience and through discussion with management (as required by auditing standards), and discussed with management the policies and procedures regarding compliance with laws and regulations.

 

The Company is subject to laws and regulations that directly affect the financial statements including financial reporting legislation and taxation legislation and we assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items.

 

The Company is subject to other laws and regulations where the consequences of non-compliance could have a material effect on amounts or disclosures in the financial statements, for instance through the imposition of litigation or impacts on the Company’s ability to operate. We identified company law as being the area most likely to have such an effect. Auditing standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of management and inspection of regulatory and legal correspondence, if any. Therefore if a breach of operational regulations is not disclosed to us or evident from relevant correspondence, an audit will not detect that breach.

 

Context of the ability of the audit to detect fraud or breaches of law or regulation

 

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it.

 

In addition, as with any audit, there remains a higher risk of non-detection of fraud, as this may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. Our audit procedures are designed to detect material misstatement. We are not responsible for preventing non-compliance or fraud and cannot be expected to detect non-compliance with all laws and regulations.

MORTON WOOD SOLAR LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF MORTON WOOD SOLAR LIMITED
- 6 -

The directors' report

 

The directors are responsible for the Directors' Report. Our opinion on the financial statements does not cover that report and we do not express an audit opinion thereon.

Our responsibility is to read the Directors' Report and, in doing so, consider whether, based on our financial statements audit work, the information therein is materially misstated or inconsistent with the financial statements or our audit knowledge. Based solely on that work:

Matters on which we are required to report by exception

Under the Companies Act 2006, we are required to report to you if, in our opinion:

 

We have nothing to report in these respects.

Respective responsibilities
Directors' responsibilities

As explained more fully in their statement set out on page 2, the directors are responsible for: the preparation of the financial statements including being satisfied that they give a true and fair view; such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error; 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 they either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities

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 our opinion in an auditor’s report. Reasonable assurance is a high level of assurance, but does not 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 aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial statements.

A fuller description of our responsibilities is provided on the FRC’s website at www.frc.org.uk/auditors responsibilities.

MORTON WOOD SOLAR LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF MORTON WOOD SOLAR LIMITED
- 7 -

The purpose of our audit work and to whom we owe our responsibilities

This report is made solely to the Company's member, 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 member 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 its member, as a body, for our audit work, for this report, or for the opinions we have formed.

Barry Ryan (Senior Statutory Auditor)
For and on behalf of KPMG Channel Islands Limited (Statutory Auditor)
Chartered Accountants
Guernsey
18 December 2024
MORTON WOOD SOLAR LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2024
- 8 -
2024
2023
Notes
£
£
Turnover
3
832,553
920,058
Cost of sales
(153,740)
(73,203)
Gross profit
678,813
846,855
Administrative expenses
(326,623)
(394,994)
Operating profit
4
352,190
451,861
Interest receivable and similar income
7
8,284
378
Interest payable and similar expenses
8
(271,580)
(268,110)
Profit before taxation
88,894
184,129
Tax on profit
9
3,115
(66,643)
Total comprehensive income and profit for the financial year
92,009
117,486

The statement of comprehensive income has been prepared on the basis that all operations are continuing operations.

The notes on pages 12 to 23 form part of these financial statements.

MORTON WOOD SOLAR LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2024
30 June 2024
- 9 -
2024
2023
Notes
£
£
£
£
Fixed assets
Tangible assets
10
2,749,363
2,908,611
Current assets
Debtors
11
378,600
370,726
Cash at bank and in hand
146,373
296,024
524,973
666,750
Creditors: amounts falling due within one year
12
(2,989,272)
(3,380,327)
Net current liabilities
(2,464,299)
(2,713,577)
Total assets less current liabilities
285,064
195,034
Provisions for liabilities
Provisions
14
48,641
47,455
Deferred tax liability
15
92,605
95,770
(141,246)
(143,225)
Net assets
143,818
51,809
Capital and reserves
Called up share capital
16
1
1
Profit and loss reserves
143,817
51,808
Total equity
143,818
51,809

The notes on pages 12 to 23 form part of these financial statements.

The financial statements were approved by the board of directors and authorised for issue on 16 December 2024 and are signed on its behalf by:
N A Wood
Director
Company registration number 08855562 (England and Wales)
MORTON WOOD SOLAR LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2024
- 10 -
Share capital
Profit and loss reserves
Total
£
£
£
Balance at 1 July 2022
1
(65,678)
(65,677)
Year ended 30 June 2023:
Profit and total comprehensive income
-
117,486
117,486
Balance at 30 June 2023
1
51,808
51,809
Year ended 30 June 2024:
Profit and total comprehensive income
-
92,009
92,009
Balance at 30 June 2024
1
143,817
143,818
The following describes the nature and purpose of each reserve within equity:
Share capital - nominal value of share capital subscribed for.
Profit and loss reserves - cumulative profit or losses, net of dividends paid and other adjustments.

The notes on pages 12 to 23 form part of these financial statements.

MORTON WOOD SOLAR LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2024
- 11 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
21
434,306
573,102
Income taxes paid
(51,149)
(22,115)
Net cash inflow from operating activities
383,157
550,987
Investing activities
Interest received
8,284
378
Net cash generated from investing activities
8,284
378
Financing activities
Proceeds from borrowings
-
0
(468,863)
Interest paid
(541,092)
(200,136)
Net cash used in financing activities
(541,092)
(668,999)
Net decrease in cash and cash equivalents
(149,651)
(117,634)
Cash and cash equivalents at beginning of year
296,024
413,658
Cash and cash equivalents at end of year
146,373
296,024

The notes on pages 12 to 23 form part of these financial statements.

MORTON WOOD SOLAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024
- 12 -
1
Accounting policies
Company information

Morton Wood Solar Limited (the "Company") is a private company limited by shares incorporated in England and Wales. The registered office is 1010 Eskdale Road, Winnersh Triangle, Wokingham, Berkshire, RG41 5TS.

 

The principal activity of the Company in the year under review was that of generation of electricity from renewable energy sources which is achieved through the operation of solar photovoltaic installations.

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 £.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

1.2
Going concern

These accounts have been prepared on a going concern basis. The directors believe this basis is appropriate following the consideration of cashflow forecasts which show the Company is able to meet its liabilities as they fall due for at least twelve months from the date of approval of these financial statements.

 

The Company recorded a profit for the year of £92,009 (2023: £117,486). At the year end, the Company reported net current liabilities of £2,464,299 (2023: £2,713,577), as a result of an intra-group loan (see note 12).

 

The directors have considered the impact which the current conflict in Ukraine could have on the Company. In their view, as the Company has no direct exposure to Ukraine or Russia, the directors do not expect a significant impact on revenue and cash flows of the Company arising from the conflict.

 

Should any unforeseen circumstances require additional funding, the Company has obtained written confirmation from its intermediate parent that it would provide financial support to meet the Company's liabilities for a period of at least 12 months from the date the financial statements are approved.

1.3
Turnover

Turnover is generated from electricity sold to a third party under a Power Purchase Agreement ("PPA") and through the renewable obligation certificate ("ROC") under a UK government scheme associated with electricity generated. It is recognised net of VAT when the electricity is physically exported.

1.4
Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical costs includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

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:

Plant and equipment
Straight line over 25 years
MORTON WOOD SOLAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
1
Accounting policies
(Continued)
- 13 -

The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.

 

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 the statement of comprehensive income.

1.5
Borrowing costs
All borrowing costs are recognised in the Statement of Comprehensive Income in the year in which they are incurred.
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). Where it is not possible to estimate the recoverable amount of an individual asset, the Company 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 the statement of comprehensive income.

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 the statement of comprehensive income.

1.7
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.

1.8
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 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.

MORTON WOOD SOLAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
1
Accounting policies
(Continued)
- 14 -
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.

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 the statement of comprehensive income.

 

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 the statement of comprehensive income.

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the company 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.

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 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.

 

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.

Derecognition of financial liabilities

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

1.9
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.

MORTON WOOD SOLAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
1
Accounting policies
(Continued)
- 15 -
1.10
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 period. Taxable profit differs from net profit as reported in the statement of comprehensive income 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 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 statement of comprehensive income, 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.

1.11
Provisions

Provisions are made where an event has taken place that gives the Company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.

 

Provisions are charged as an expense to the Statement of Comprehensive Income in the year that the Company becomes aware of the obligation, and are measured at the best estimate at the Statement of Financial Position date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.

 

When payments are eventually made, they are charged to the provision carried in the Statement of Financial Position.

1.12
Leases

Rentals payable under operating leases, including any lease incentives received, are charged to statement of comprehensive income 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.

MORTON WOOD SOLAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
1
Accounting policies
(Continued)
- 16 -
1.13

Loans

Non-derivative financial liabilities with fixed or determinable repayments that are not quoted in an active market are classified as loans. Loans are initially recognised at fair value of the consideration received plus directly related transaction costs. They are subsequently measured at amortised cost using the effective interest method. Arrangement fees and interest payable on financial liabilities that are classified as loans, are charged to the statement of comprehensive income as they are incurred.

 

The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating the interest payable over the expected life of the liability. The effective interest rate is the rate that exactly discounts estimated future cashflows to the instrument's initial carrying amount. Calculation of the effective interest rate takes into account fees payable, that are an integral part of the instrument yield and transaction costs. All contractual terms of a financial instrument are considered when estimating future cash flows.

 

A financial liability is removed from the statement of financial position when the obligation is discharged, or cancelled, or expires.

1.14

Finance costs

Finance costs are charged to the Statement of Comprehensive Income over the term of the debt so that the amount charged is at a constant rate on the carrying amount. Finance costs include issue costs, which are initially recognised as a reduction in the proceeds of the associated capital instrument.

1.15

Interest income

Interest income is recognised in the Statement of Comprehensive Income using the effective interest rate method.

MORTON WOOD SOLAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 17 -
2
Judgements and key sources of estimation uncertainty

The preparation of the financial statements under FRS 102 requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making judgments about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

 

In preparing the financial statements, the directors have made the following judgements and estimates:

 

 

 

 

 

3
Turnover

All turnover arose within the United Kingdom from the generation of electricity, in both the current and prior year.

 

4
Operating profit
2024
2023
Operating profit for the year is stated after charging:
£
£
Fees payable to the company's auditor for the audit of the company's financial statements
5,000
4,000
Depreciation of owned tangible fixed assets
159,248
158,813
Electricity Generator Levy recharge
60,205
44,592
Operating lease charges
34,831
49,492

In the year ended 30 June 2024 the Company incurred a recharge from Bluefield Renewables 1 Limited, the UK parent of the Bluefield Solar Income Fund Limited group, in respect of the Electricity Generator Levy which came into effect on 1 January 2023. The recharge for this year was £60,205 (2023 - £44,592).

MORTON WOOD SOLAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 18 -
5
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
5,000
4,000
6
Employees

The Company had no employees (2023 - Nil) other than its directors, who did not receive any remuneration (2023 - Nil).

7
Interest receivable and similar income
2024
2023
£
£
Interest income
Interest on bank deposits
8,284
378
8
Interest payable and similar expenses
2024
2023
£
£
Interest on financial liabilities measured at amortised cost:
Interest on loan from group undertakings
269,175
266,952
Other finance costs:
Unwinding of discount on provisions
1,187
1,158
Other interest
1,218
-
0
271,580
268,110
9
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
50
26,109
Deferred tax
Origination and reversal of timing differences
(3,165)
30,785
Adjustment in respect of prior periods
-
0
9,749
Total deferred tax
(3,165)
40,534
Total tax (credit)/charge
(3,115)
66,643
MORTON WOOD SOLAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
9
Taxation
(Continued)
- 19 -

The actual (credit)/charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:

2024
2023
£
£
Profit before taxation
88,894
184,129
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 20.50%)
22,224
37,746
Tax effect of expenses that are not deductible in determining taxable profit
15,380
9,376
Group relief
(45,895)
-
0
Depreciation on assets not qualifying for tax allowances
5,176
4,231
Corrections in respect of prior year
-
0
9,749
Difference in tax rate used for deferred tax
-
0
5,541
Taxation (credit)/charge for the year
(3,115)
66,643

At the reporting date, the Company had unused tax adjusted losses of £49,341 (2023: £49,341), for which management have elected to recognise a deferred tax asset in respect of.

 

The tax losses do not have an expiry date.

10
Tangible fixed assets
Plant and equipment
£
Cost
At 1 July 2023 and 30 June 2024
3,970,320
Depreciation and impairment
At 1 July 2023
1,061,709
Depreciation charged in the year
159,248
At 30 June 2024
1,220,957
Carrying amount
At 30 June 2024
2,749,363
At 30 June 2023
2,908,611

The tangible fixed assets of the Company form part of the security offered against debts of other group companies.

MORTON WOOD SOLAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 20 -
11
Debtors
2024
2023
Amounts falling due within one year:
£
£
Trade debtors
16,416
80,391
Corporation tax recoverable
23,773
-
0
Amounts owed by group undertakings
95,000
-
0
Prepayments and accrued income
243,411
290,335
378,600
370,726

Amounts owed by group undertakings are unsecured, repayable on demand and bears no interest.

12
Creditors: amounts falling due within one year
2024
2023
£
£
Trade creditors
28,171
88,404
Amounts owed to group undertakings
2,847,419
3,121,928
Corporation tax
-
0
26,109
Other taxation and social security
25,515
18,974
Accruals and deferred income
88,167
124,912
2,989,272
3,380,327

Included in amounts owed to group undertakings are unsecured debts of £2,847,419 (2023: £3,119,336). The loan is repayable on demand and bears interest at 8.65% per annum (2023: 7.82%), which compounds annually on 30 June.

 

Bayerische Landesbank as Trustee for the Secured Parties (Security Trustee) holds fixed and floating charges dated 11 October 2016 covering all the property or undertaking of the company, the outstanding charge contains a negative pledge.

13
Financial instruments
2024
2023
£
£
Carrying amount of financial assets
Financial assets measured at amortised cost
344,135
345,352
Cash
146,373
296,024
Carrying amount of financial liabilities
Financial liabilities measured at amortised cost
2,963,757
3,335,244

Financial assets measured at amortised cost comprise trade debtors and accrued income.

 

Financial liabilities measured at amortised cost comprise trade creditors, accruals and amounts owed to group undertakings.

MORTON WOOD SOLAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 21 -
14
Provisions for liabilities
2024
2023
£
£
Restoration provision
48,641
47,455
Movements on provisions:
Restoration provision
£
At 1 July 2023
47,454
Unwinding of discount charges to the Statement of Comprehensive Income
1,187
At 30 June 2024
48,641

The restoration provision relates to the Company's expected costs to restore the land on which the Company's asset is situated, to its original condition at the end of the lease term, which expires in September 2041.

15
Deferred taxation

The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:

Liabilities
Liabilities
2024
2023
Balances:
£
£
Accelerated capital allowances
104,940
108,105
Tax losses carried forward
(12,335)
(12,335)
92,605
95,770
2024
Movements in the year:
£
At beginning of year
95,770
Charge to statement of comprehensive income
(3,165)
At end of year
92,605
16
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary of 1p each
100
100
1
1
MORTON WOOD SOLAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
16
Share capital
(Continued)
- 22 -

The Company has one class of Ordinary shares, which have attached to them full voting, dividend and capital distribution rights (including on a winding up). The shares do not confer any rights of redemption.

17
Operating lease commitments
Lessee

At the reporting end date the Company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

2024
2023
£
£
Within one year
36,281
34,582
Between two and five years
181,405
172,910
In over five years
412,092
427,952
629,778
635,444
18
Related party transactions

The Company has taken advantage of the exemption available in Section 33.1A of FRS102 whereby it has not disclosed transactions with the ultimate parent company or any wholly owned subsidiary undertakings of the parent company's group.

 

The Company incurred expenses and fees of £32,352 (2023: £46,070) payable to Bluefield Services Limited. The amounts represent debt compliance, monitoring and asset management services incurred by Bluefield Services Limited in advising the Company. At the year end, £Nil (2023: £30,084) was owed to Bluefield Services Limited.

 

Bluefield Services Limited is under the control of the group's investment advisors.

19
Events after the reporting date

There have been no significant events affecting the Company since the year end.

20
Ultimate controlling party

The Company's immediate parent company is IREEL Solar HoldCo Limited, a company incorporated in the United Kingdom. The registered office is 1010 Eskdale Road, Winnersh Triangle, Wokingham, Berkshire, RG41 5TS.

 

The ultimate parent company and controlling party is Bluefield Solar Income Fund Limited, which is incorporated in Guernsey.

MORTON WOOD SOLAR LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024
- 23 -
21
Cash generated from operations
2024
2023
£
£
Profit for the year after tax
92,009
117,486
Adjustments for:
Taxation (credited)/charged
(3,115)
66,643
Finance costs
271,580
268,110
Investment income
(8,284)
(378)
Depreciation and impairment of tangible fixed assets
159,248
158,813
Movements in working capital:
Decrease/(increase) in debtors
15,899
(138,525)
(Decrease)/increase in creditors
(93,031)
100,953
Cash generated from operations
434,306
573,102
22
Analysis of changes in net debt
1 July 2023
Cash flows
Other non-cash changes
30 June 2024
£
£
£
£
Cash at bank and in hand
296,024
(149,651)
-
146,373
Amounts owed to group undertakings
(3,119,336)
541,092
(269,175)
(2,847,419)
(2,823,312)
391,441
(269,175)
(2,701,046)
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