Company registration number 00657938 (England and Wales)
ROFFEY HOMES LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2024
ROFFEY HOMES LIMITED
COMPANY INFORMATION
Directors
Mr I R Cheal
Mrs J Cheal
Mr M J Cheal
Mr B J Cheal
Mr J I Cheal
Secretary
Mrs J Cheal
Company number
00657938
Registered office
Amelia House
Crescent Road
Worthing
West Sussex
BN11 1RL
Auditor
Sumer Audit
Amelia House
Crescent Road
Worthing
West Sussex
BN11 1RL
Business address
Cheals Mews
15-19 & 21 Buckingham Road
Worthing
West Sussex
BN11 1TH
ROFFEY HOMES LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3
Directors' responsibilities statement
4
Independent auditor's report
5 - 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 - 24
ROFFEY HOMES LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MAY 2024
- 1 -

The directors present the strategic report for the year ended 31 May 2024.

Fair review of the business and future prospects

Results and performance:

 

The board are pleased with the reported revenue in the year of £22.1m (2023 - £10.3m) and the gross profit margins of 13.85% (2023 - 12.06%), which are both in line with expectations.

 

The statement of financial position shows the company has net current assets of £14.1m (2023 - £13.1m), and net assets of £11.2m (2023 - £10.4m). This includes inventories totalling £11.7m (2023 - £21.3m).

 

The results for the year reflect both the stages of various developments in progress and those completed at the year end.

 

The directors remain satisfied with the trading performance of the company during the year and expect the company to continue to report acceptable revenues and profits in the forthcoming year.

Principal risks and uncertainties

Market risk: The company is affected by the confidence of the housing market, and the impact the cost of living crisis might have on consumer spending and confidence. Management mitigate this risk by preparing financial forecasts for future developments on a prudent basis and look to achieve a specific return on all projects.

Liquidity risk: The company maintains sufficient cash to meet its obligations as and when they become due. The company uses cash at bank and loans from directors to manage its working capital. Management mitigate this risk by preparing financial forecasts and quarterly management accounts to ensure liquidity is monitored, especially at the start of a large project.

Interest rate risk: The company is exposed to interest rate risk on its variable rate borrowings and cash flow interest rate risk on bank overdraft facilities and loans. The company ensures interest rate risk is managed by entering into contracts that are deemed to be suitable for the company's needs.

 

The directors will continue to monitor the situation, but with the strong balance sheet and the appropriate funding in place the directors are confident that all foreseeable risks can be mitigated as far as possible.

 

Credit rate risk: Investments of cash surpluses and borrowings are made through banks and companies which must fulfil credit rating criteria approved by the Board.

 

All customers who wish to trade on credit terms are subject to credit verification procedures. Trade debtors are monitored on an ongoing basis and provision is made for doubtful debts where necessary.

Development and performance

The position of the company at the year end is shown on page 10.

The directors continue to be pleased with the revenues and profits generated on various completed developments and ongoing projects in the forthcoming period.

Key performance indicators

Apart from those measures identified above in the business review, the directors are of the opinion that no further inclusion of financial and non-financial key performance indicators is necessary for an understanding of the development, performance or position of the company’s business.

ROFFEY HOMES LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2024
- 2 -

Approved and signed on behalf of the board

Mr I R Cheal
Director
19 December 2024
ROFFEY HOMES LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MAY 2024
- 3 -

The directors present their annual report and financial statements for the year ended 31 May 2024.

Principal activities

The principal activity of the company continued to be that of development of land and property.

Results and dividends

The results for the year are set out on page 8.

No ordinary dividends were paid. The directors do not recommend payment of a final dividend.

Directors

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

Mr I R Cheal
Mrs J Cheal
Mr M J Cheal
Mr B J Cheal
Mr J I Cheal
Financial instruments

The principal risks affecting the company are summarised in the strategic report.

Auditor

The auditor, Sumer Audit, is deemed to be reappointed under section 487(2) of the Companies Act 2006.

Statement of disclosure to auditor

So far as the directors are aware, there is no relevant audit information of which the company's auditor are unaware. Additionally, the directors 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 auditors are aware of that information.

Medium-sized companies exemption

This report has been prepared in accordance with the provisions applicable to companies entitled to the medium-sized companies exemption.

On behalf of the board
Mr I R Cheal
Director
19 December 2024
ROFFEY HOMES LIMITED
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 MAY 2024
- 4 -

The directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:

 

 

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

ROFFEY HOMES LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF ROFFEY HOMES LIMITED
- 5 -
Opinion

We have audited the financial statements of Roffey Homes Limited (the 'company') for the year ended 31 May 2024 which comprise the statement of comprehensive income, the statement of financial position, the statement of changes in equity, the statement of cash flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

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 company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

 

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

 

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

 

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of our audit:

ROFFEY HOMES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ROFFEY HOMES LIMITED
- 6 -
Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

 

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

Responsibilities of directors

As explained more fully in the directors' responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, our procedures included the following:

 

 

As a result of these procedures, we considered the opportunities and incentives that may exist within the company for fraud. We are also required to perform specific procedures to respond to the risk of management override. As a result of performing the above, we identified the following areas as those most likely to have an impact on the financial statements: employment law, and compliance with the UK Companies Act.

In addition to the above, our procedures to respond to risks identified included the following:

 

ROFFEY HOMES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ROFFEY HOMES LIMITED
- 7 -

Due to the inherent limitations of an audit, there is an unavoidable risk that some material misstatements in the financial statements may not be detected, even though the audit is properly planned and performed in accordance with the ISAs (UK). For instance, the further removed non-compliance is from the events and transactions reflected in the financial statements, the less likely the auditor is to become aware of it or to recognise the non-compliance.

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.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Peter Reading FCCA (Senior Statutory Auditor)
For and on behalf of Sumer Audit
19 December 2024
Chartered Accountants
Statutory Auditor
Worthing
Sumer Audit is the trading name of Sumer Auditco Limited
ROFFEY HOMES LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MAY 2024
- 8 -
2024
2023
Notes
£
£
Revenue
3
22,111,305
10,272,337
Cost of sales
(19,048,839)
(9,033,575)
Gross profit
3,062,466
1,238,762
Administrative expenses
(1,767,203)
(711,695)
Other operating income
427,538
515,646
Operating profit
5
1,722,801
1,042,713
Investment income
187,067
18,862
Finance costs
8
(610,372)
(988,823)
Fair value gains on investment properties
(147,844)
159,397
Profit before taxation
1,151,652
232,149
Taxation
9
(286,080)
(49,478)
Profit for the financial year
865,572
182,671

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

ROFFEY HOMES LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT
31 MAY 2024
31 May 2024
- 9 -
2024
2023
Notes
£
£
£
£
Non-current assets
Property, plant and equipment
10
17,706
26,719
Investments
11
2,962,530
3,110,374
2,980,236
3,137,093
Current assets
Inventories
12
11,720,149
21,283,948
Trade and other receivables
13
1,712,714
6,835,936
Cash and cash equivalents
4,960,292
877,506
18,393,155
28,997,390
Current liabilities
14
(4,312,014)
(15,946,578)
Net current assets
14,081,141
13,050,812
Total assets less current liabilities
17,061,377
16,187,905
Non-current liabilities
15
(5,000,000)
(5,000,000)
Provisions for liabilities
Provisions
17
150,000
100,000
Deferred tax liability
18
692,900
735,000
(842,900)
(835,000)
Net assets
11,218,477
10,352,905
Equity
Called up share capital
20
10,000
10,000
Non-distributable retained earnings
21
2,080,358
2,191,202
Distributable retained earnings
9,128,119
8,151,703
Total equity
11,218,477
10,352,905

These financial statements have been prepared in accordance with the provisions relating to medium-sized companies.

The financial statements were approved by the board of directors and authorised for issue on 19 December 2024 and are signed on its behalf by:
Mr B J Cheal
Director
Company registration number 00657938 (England and Wales)
ROFFEY HOMES LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MAY 2024
- 10 -
Share capital
Non-distribut-able retained earnings
Distribut-able retained earnings
Total
£
£
£
£
Balance at 1 June 2022
10,000
2,071,705
8,088,529
10,170,234
Year ended 31 May 2023:
Profit and total comprehensive income
-
119,497
63,174
182,671
Balance at 31 May 2023
10,000
2,191,202
8,151,703
10,352,905
Year ended 31 May 2024:
Profit and total comprehensive income
-
(110,844)
976,416
865,572
Balance at 31 May 2024
10,000
2,080,358
9,128,119
11,218,477
ROFFEY HOMES LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MAY 2024
- 11 -
2024
2023
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from/(absorbed by) operations
26
13,010,887
(7,544,508)
Income taxes paid
(17,180)
(341,078)
Net cash inflow/(outflow) from operating activities
12,993,707
(7,885,586)
Investing activities
Purchase of property, plant and equipment
(3,334)
-
0
Proceeds on disposal of property, plant and equipment
284
-
0
Interest received
187,067
18,862
Net cash generated from investing activities
184,017
18,862
Financing activities
Proceeds from borrowings
798,996
1,091,365
Repayment of borrowings
(9,866,243)
(2,615,000)
Net cash used in financing activities
(9,067,247)
(1,523,635)
Net increase/(decrease) in cash and cash equivalents
4,110,477
(9,390,359)
Cash and cash equivalents at beginning of year
849,815
10,240,174
Cash and cash equivalents at end of year
4,960,292
849,815
Relating to:
Cash at bank and in hand
4,960,292
877,506
Bank overdrafts included in creditors payable within one year
-
0
(27,691)
ROFFEY HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MAY 2024
- 12 -
1
Accounting policies
Company information

Roffey Homes Limited is a private company limited by shares incorporated in England and Wales. The registered office is Amelia House, Crescent Road, Worthing, West Sussex, BN11 1RL.

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 £1.

The financial statements have been prepared under the historical cost convention, modified to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.

1.2
Going concern

At the time of approving the financial statements, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. The directors have considered relevant information, including the company's principal risks and uncertainties, forecast future cash flows and the impact of subsequent events in making their assessment. Based on these assessments and having regard to the resources available to the entity, the directors have concluded that there is no material uncertainty and that they can continue to adopt the going concern basis of preparing the annual report and financial statements.true

1.3
Revenue

Revenue is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes.

 

When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (on completion), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

1.4
Property, plant and equipment

Property, plant and equipment 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:

Land and buildings freehold
Freehold land and buildings are not depreciated
Plant and machinery
15% or 25% diminishing balance
Motor vehicles
25% diminishing balance

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is credited or charged to profit or loss.

ROFFEY HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2024
1
Accounting policies
(Continued)
- 13 -
1.5
Investment properties

 

Freehold ground rents

The company receives ground rent from properties which have been sold on long leases, with the company retaining title of the freehold land. The cost is initially recognised in the statement of financial position and included as freehold ground rents in investment properties. The company holds these ground rents to ensure that the character and condition of the developed sites can be maintained to the high standards that the company designs and builds.

 

In accordance with accounting standards, the directors have revalued the ground rents to fair value.

 

Leasehold reversions and shared equity

Occasionally, the company recognises the need to provide assistance to customers in order to enable the sale of development sites. This can be in the form of discounts and two other methods as set out below.

 

Leasehold reversions relate to properties sold on long leases at a discounted amount. The discounted sale proceeds and a proportion of related costs are included in the statement of comprehensive income, with the remaining costs being capitalised and included in investment properties. This represents the estimated fair value of the future reversion.

 

Shared equity investments relate to a scheme whereby the company retains an interest in the purchaser's property representing a percentage of the selling price. This is charged over a percentage of the market value of the property at disposal. This interest is initially included in investment properties at cost.

 

The leasehold reversions and shared equity investment properties are initially stated at cost with subsequent revaluations to fair value. The directors undertake these valuations in accordance with accounting standards and taking advice from suitably qualified professionals.

 

The directors believe that the above investment properties are necessary to undertake the trading activity of the company, but also recognise that they must reflect the transactions in accordance with accounting standards.

 

1.6
Impairment of non-current 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.

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 is estimated to be less than its carrying amount, the carrying amount of the asset 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.

1.7
Inventories

Inventories are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the inventories to their present location and condition.

ROFFEY HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2024
1
Accounting policies
(Continued)
- 14 -

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of inventories over its estimated selling price less costs to complete and sell is recognised as an impairment loss in the statement of comprehensive income. Reversals of impairment losses are also recognised in the statement of comprehensive income.

1.8
Construction contracts

Where the outcome of a construction contract can be estimated reliably, revenue and costs are recognised by reference to the stage of completion of the contract activity at the reporting end date. Variations in contract work, claims and incentive payments are included to the extent that the amount can be measured reliably and its receipt is considered probable.

 

When it is probable that total contract costs will exceed total contract turnover, the expected loss is recognised as an expense immediately.

 

Where the outcome of a construction contract cannot be estimated reliably, contract revenue is recognised to the extent of contract costs incurred where it is probable that they will be recoverable. Contract costs are recognised as expenses in the period in which they are incurred. When costs incurred in securing a contract are recognised as an expense in the period in which they are incurred, they are not included in contract costs if the contract is obtained in a subsequent period.

The “percentage of completion method” is used to determine the appropriate amount to recognise in a given period. The stage of completion is measured by the proportion of contract costs incurred for work performed to date compared to the estimated total contract costs. Costs incurred in the year in connection with future activity on a contract are excluded from contract costs in determining the stage of completion. These costs are presented as stocks, prepayments or other assets depending on their nature, and provided it is probable they will be recovered.

1.9
Cash and cash equivalents

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks and bank overdrafts.

1.10
Financial instruments

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

Basic financial assets

Basic financial assets, which include trade and other receivables 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.

ROFFEY HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2024
1
Accounting policies
(Continued)
- 15 -
Impairment of financial assets

Financial assets, other than those held at fair value through profit and loss, are assessed for indicators of impairment at each reporting end date.

 

Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

 

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

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 trade creditors and other payables, are recognised at transaction price. Financial liabilities classified as payable within one year are not amortised.

Trade payables 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 payables are recognised at transaction price.

Derecognition of financial liabilities

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

1.11
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.

1.12
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.

ROFFEY HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2024
1
Accounting policies
(Continued)
- 16 -
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.

1.13
Provisions

Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.

 

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.

1.14
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 non-current assets.

 

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

1.15
Retirement benefits

The company operates a defined contribution scheme for the benefit of its employees. The assets of the scheme are held separately from those of the company. Contributions payable are charged to the statement of comprehensive income in the year they are payable.

1.16
Leases

Rental income, lease premiums and sundry income from operating leases are 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.

ROFFEY HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2024
- 17 -
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.

Critical judgements

The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.

Provisions

Provision is made for warranties and provision claims. These provisions require management’s best estimate of the costs that will be incurred.

Revaluation of investment properties

Investment property valuations are reviewed annually using the fair value method. The fair value is determined by reference to the amounts likely to be received when leases are extended and a multiple of ground rents receivable.

3
Revenue

An analysis of the company's revenue is as follows:

2024
2023
£
£
Revenue analysed by class of business
Sales of properties
20,840,054
13,223
Construction contracts
1,271,251
10,259,114
22,111,305
10,272,337

The total turnover of the company for the year has been derived from its principal activity wholly undertaken in the United Kingdom.

4
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
14,250
13,500
ROFFEY HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2024
- 18 -
5
Operating profit
2024
2023
Operating profit for the year is stated after charging/(crediting):
£
£
Depreciation of owned property, plant and equipment
3,705
2,109
Profit on disposal of property, plant and equipment
(8,358)
-
6
Directors' remuneration
2024
2023
£
£
Remuneration for qualifying services
1,291,619
391,916
Company pension contributions to defined contribution schemes
25,000
25,000
1,316,619
416,916
Remuneration disclosed above include the following amounts paid to the highest paid director:
2024
2023
£
£
Remuneration for qualifying services
1,060,471
203,416

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 1 (2023 - 1).

7
Employees

The average monthly number of persons (including directors) employed by the company during the year was:

2024
2023
Number
Number
Administration
6
6
Total
6
6

Their aggregate remuneration comprised:

2024
2023
£
£
Wages and salaries
1,296,619
396,916
Social security costs
173,359
59,959
Pension costs
25,000
25,000
1,494,978
481,875
ROFFEY HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2024
- 19 -
8
Finance costs
2024
2023
£
£
Other finance costs:
Other interest
610,372
988,823
9
Taxation
2024
2023
£
£
Current tax
UK corporation tax on profits for the current period
328,000
17,000
Adjustments in respect of prior periods
180
(6,922)
Total current tax
328,180
10,078
Deferred tax
Origination and reversal of timing differences
(42,100)
39,400
Total tax charge
286,080
49,478

The actual 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
1,151,652
232,149
Expected tax charge based on the standard rate of corporation tax in the UK of 25.00% (2023: 20.00%)
287,913
46,430
Tax effect of expenses that are not deductible in determining taxable profit
1,135
2,301
Under/(over) provided in prior years
180
(6,922)
Other tax adjustments
(3,148)
(202)
Effect of difference between current and deferred tax rate
-
0
7,871
Taxation for the year
286,080
49,478
ROFFEY HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2024
- 20 -
10
Property, plant and equipment
Land and buildings freehold
Plant and machinery
Motor vehicles
Total
£
£
£
£
Cost
At 1 June 2023
11,400
16,253
78,979
106,632
Additions
-
0
3,334
-
0
3,334
Disposals
-
0
-
0
(67,613)
(67,613)
At 31 May 2024
11,400
19,587
11,366
42,353
Depreciation and impairment
At 1 June 2023
-
0
11,943
67,970
79,913
Depreciation charged in the year
-
0
1,372
2,333
3,705
Eliminated in respect of disposals
-
0
-
0
(58,971)
(58,971)
At 31 May 2024
-
0
13,315
11,332
24,647
Carrying amount
At 31 May 2024
11,400
6,272
34
17,706
At 31 May 2023
11,400
4,310
11,009
26,719
11
Investment properties
2024
2023
£
£
Freehold ground rent
2,747,693
2,895,537
Home reversion schemes
214,837
214,837
2,962,530
3,110,374

The directors valued the company's investments held at the balance sheet date at their fair value. The fair value has been determined by reference to the amounts likely to be received when leases are extended and a multiple of ground rents receivable.

 

Leasehold reversions have been valued to market value, discounted to present value based on expected length until reversion.

 

On a historical cost basis, the investment properties would have been included at a cost of £190,872 (2023 - £190,872).

12
Inventories
2024
2023
£
£
Work in progress
11,720,149
21,283,948
ROFFEY HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2024
- 21 -
13
Trade and other receivables
2024
2023
Amounts falling due within one year:
£
£
Trade receivables
32,968
3,503,003
Gross amounts owed by contract customers
1,397,058
2,548,011
Other receivables
282,688
784,922
1,712,714
6,835,936
14
Current liabilities
2024
2023
Notes
£
£
Bank loans and overdrafts
16
-
0
27,691
Other borrowings
16
829,407
9,840,308
Trade payables
614,544
2,895,122
Corporation tax
328,000
17,000
Other taxation and social security
73,394
100,613
Other payables
-
0
1,715,687
Accruals and deferred income
2,466,669
1,350,157
4,312,014
15,946,578
15
Non-current liabilities
2024
2023
Notes
£
£
Other borrowings
16
5,000,000
5,000,000
16
Borrowings
2024
2023
£
£
Bank overdrafts
-
0
27,691
Other borrowings
5,829,407
14,840,308
5,829,407
14,867,999
Payable within one year
829,407
9,867,999
Payable after one year
5,000,000
5,000,000

Other borrowings relates to directors' loans, of which £5,000,000 (2023: £5,000,000) of this is secured by way or a fixed and floating charge.

 

The other borrowings balance incurs interest at rates 1.7%, 7.0% and 10.0%.

ROFFEY HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2024
- 22 -
17
Provisions for liabilities
2024
2023
£
£
Provisions
150,000
100,000
Movements on provisions:
Provisions
£
At 1 June 2023
100,000
Additional provisions in the year
50,000
At 31 May 2024
150,000
18
Deferred taxation

Deferred tax assets and liabilities are offset where the company has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:

Liabilities
Liabilities
2024
2023
Balances:
£
£
Accelerated Capital Allowances
1,600
6,700
Revaluations
691,300
728,300
692,900
735,000
2024
Movements in the year:
£
Liability at 1 June 2023
735,000
Credit to profit or loss
(42,100)
Liability at 31 May 2024
692,900

The directors have considered the deferred tax liabilities noted above and conclude that it is not possible to state the estimated liabilities which will reverse within the next 12 months. This is due to the level of reversal being dependant on events which are not yet known. The deferred tax assets will reverse within the next 12 months, on payment of the amounts accrued.

ROFFEY HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2024
- 23 -
19
Retirement benefit schemes
2024
2023
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
25,000
25,000

The company operates a defined contribution pension scheme for all qualifying employees. The assets of the scheme are held separately from those of the company in an independently administered fund.

20
Share capital
2024
2023
2024
2023
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary shares of £1 each
10,000
10,000
10,000
10,000

Ordinary shares have attached to them full voting, dividend and capital distribution (including on winding up) rights.

21
Non-distributable retained earnings
2024
2023
£
£
At the beginning of the year
2,191,202
2,071,705
Non-distributable (losses)/profits in the period
(110,844)
119,497
At the end of the year
2,080,358
2,191,202

The non-distributable retained earnings reserve shows separately the fair value gains, net of any deferred tax, arising on investment properties which have passed through profit or loss in the income statement.

22
Financial commitments, guarantees and contingent liabilities

On 19 October 2021 the company became party to a joint guarantee provided to a third party with a total security of £1,650,000.

23
Related party transactions
Remuneration of key management personnel

The remuneration of key management personnel is as follows.

2024
2023
£
£
Aggregate compensation
1,488,717
467,477

At the reporting date the company owed £5,829,406 (2023 - £14,840,308) to the directors.

 

ROFFEY HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MAY 2024
- 24 -
24
Events after the reporting date

Dividends of £800,000 were declared and paid after the balance sheet date.

25
Analysis of changes in net debt
1 June 2023
Cash flows
Other non-cash changes
31 May 2024
£
£
£
£
Cash at bank and in hand
877,506
4,082,786
-
4,960,292
Bank overdrafts
(27,691)
27,691
-
-
0
849,815
4,110,477
-
4,960,292
Borrowings excluding overdrafts
(14,840,308)
9,154,451
(143,550)
(5,829,407)
(13,990,493)
13,264,928
(143,550)
(869,115)
26
Cash generated from operations
2024
2023
£
£
Profit for the year after tax
865,572
182,671
Adjustments for:
Taxation charged
286,080
49,478
Finance costs
(87,205)
-
Investment income
(187,067)
(18,862)
Loss on disposal of property, plant and equipment
8,358
-
Fair value (gains)/losses on investment properties
147,844
(159,397)
Depreciation and impairment of property, plant and equipment
3,705
2,109
Increase/(decrease) in provisions
50,000
(192,500)
Movements in working capital:
Decrease/(increase) in inventories
9,563,799
(8,261,760)
Decrease/(increase) in trade and other receivables
5,123,222
(1,084,855)
(Decrease)/increase in trade and other payables
(2,763,421)
1,938,608
Cash generated from/(absorbed by) operations
13,010,887
(7,544,508)
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