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Mental Health Care (Community) Limited

Registered number: 03179603
Directors' report and audited financial statements
For the year ended 30 June 2024

 
MENTAL HEALTH CARE (COMMUNITY) LIMITED
 
 
COMPANY INFORMATION


Directors
N Kelly 
S Weir 
D Russell 
M Oatway 
G Jennings 
S Jones 




Registered number
03179603



Registered office
Alexander House
Highfield Park

Llandyrnog

Denbighshire

LL16 4LU




Independent auditor
Forvis Mazars LLP
Chartered Accountants & Statutory Auditor

One St. Peter's Square

Manchester

M2 3DE




Bankers
Barclays Bank plc
3rd Floor

Windsor Court

3 Windsor Place

Cardiff

CF10 3ZL





 
MENTAL HEALTH CARE (COMMUNITY) 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
Notes to the Financial Statements
 
11 - 21


 
MENTAL HEALTH CARE (COMMUNITY) LIMITED
 
 
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 30 JUNE 2024

The Directors present their report and the financial statements for the year ended 30 June 2024.

Directors' responsibilities statement

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 the Directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 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 these financial statements, the Directors are required to:


select suitable accounting policies for the Company's financial statements and then apply them consistently;

make judgements and accounting estimates that are reasonable and prudent;

prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and to enable them to ensure that the financial statements comply with the Companies Act 2006They 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.

Principal activity

The Company's principal activity is the provision of residential care for people with learning disabilities and challenging behaviour.

Directors

The Director who served during the year was:

N Kelly 
S Weir 
D Russell 
M Oatway 
G Jennings 
S Jones 

- 1 -

 
MENTAL HEALTH CARE (COMMUNITY) LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024

Going concern

Liquidity is managed on a group wide basis (the “Group”) by the ultimate holding company of the Company. The Group is not reliant on third party finance and does not expect to be so for the foreseeable future.
The board has considered the Group's and the Company's future trading and cash flows for the foreseeable future, taking into account reasonably possible changes in trading performance, and has concluded that the Group has adequate resources to continue in operational existence for the foreseeable future. The financial statements are thus prepared on a going concern basis.
The Group remains both profitable and in a net asset position.
The Directors consider the Group to be resilient and able to respond to any adverse effects in order to minimise the impact on the financial performance of the Group.

Principal risks and uncertainties

The directors consider the key risks and uncertainties facing the Company to be as follows:
Competitive pressure in a market for specialist challenging behaviour services is a continuing risk for the Company as a number of alternative providers exist across the UK. The Group continues to mitigate for this risk by developing services which are sufficiently differentiated from the competition by means of both the behavioural models applied and the niche client groups cared for by the Group.
The service users are wholly funded by public sector sources. Consequently the group is therefore exposed to risks surrounding changes in government policies and the impact of enacted and planned reductions in spending on health and social care. This risk is mitigated by providing robust evidence of quality and service user outcomes, as well as ensuring that the group continues to contract with a wide range of funding providers. The group will continue to review and amend its cost base to counteract funding changes.
The directors have considered the Company and the Group’s trading and cash flows for the foreseeable future taking into account reasonably possible changes in trading performance. After making enquiries and taking into account the uncertainties arising from the current economic circumstances, the directors have a reasonable expectation that the Company and the Group have adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the annual report and financial statements.

Economic impact of global events

UK businesses are currently facing many uncertainties such as the continuing consequences of Brexit, political change, environmental sustainability and geopolitical events such as the Russian invasion of Ukraine. These uncertainties have contributed to an environment where there exists a range of issues and risks, including inflation, rising interest rates, labour shortages, disrupted supply chains and new ways of working.
The Directors have carried out an assessment of the potential impact of these uncertainties on the business, including the impact of mitigation measures, and have concluded that these are non-adjusting events with the greatest impact on the business expected to be from the economic ripple effect on the global economy. The Directors have taken account of these potential impacts in their going concern assessment.
The Company continues to work with its partners to minimise any impacts of these events and maximise the realisation of any opportunities they may provide to the business.

- 2 -

 
MENTAL HEALTH CARE (COMMUNITY) LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 30 JUNE 2024

Future developments

The Company's strategy is to continually improve the quality of the services provided. Delivery of this has continued during the financial year, through continued investment in the service offering and the development of our employees.

Disclosure of information to auditor

Each of the persons who are Directors at the time when this Directors' Report is approved has confirmed that:
 
so far as the Directors is aware, there is no relevant audit information of which the Company's auditor is unaware, and

the Directors has taken all the steps that ought to have been taken as a Directors in order to be aware of any relevant audit information and to establish that the Company's auditor is aware of that information.

Post balance sheet events

There have been no post balance sheet events to disclose within the financial statements.

Auditor

Auditors will be appointed for the following financial year in accordance with section 485 of the Companies Act 2006.

Small companies note

In preparing this report, the Directors have taken advantage of the small companies exemptions provided by section 415A of the Companies Act 2006.

This report was approved by the board on 19 December 2024 and signed on its behalf.
 





N Kelly
Director

- 3 -

 
MENTAL HEALTH CARE (COMMUNITY) LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF MENTAL HEALTH CARE (COMMUNITY) LIMITED
 

Opinion

We have audited the financial statements of Mental Health Care (Community) Limited (the ‘Company’) for the year ended 30 June 2024 which comprise the Statement of Comprehensive Income, the Statement of Financial Position, the Statement of Changes in Equity and notes to the financial statements, including a summary of significant accounting policies. 
The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (United Kingdom Generally Accepted Accounting Practice).

In our opinion, the financial statements:

give a true and fair view of the state of the Company’s affairs as at 30 June 2024 and of its profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.

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.
- 4 -

 
MENTAL HEALTH CARE (COMMUNITY) LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF MENTAL HEALTH CARE (COMMUNITY) LIMITED
 

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 the audit:
 
the information given in the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
the Directors' Report has been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Directors' Report.

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

adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of directors' remuneration specified by law are not made; or
we have not received all the information and explanations we require for our audit.
the directors were not entitled to prepare the financial statements in accordance with the small companies regime and take advantage of the small companies’ exemption in preparing the Directors' Report and from the requirement to prepare a Strategic Report.
- 5 -

 
MENTAL HEALTH CARE (COMMUNITY) LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF MENTAL HEALTH CARE (COMMUNITY) LIMITED
 

Responsibilities of Directors

As explained more fully in the Directors' Responsibilities Statement set out on page 1, 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 intend either 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.
 
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. 

Based on our understanding of the Company and its industry, we considered that non-compliance with the following laws and regulations might have a material effect on the financial statements: employment regulation, health and safety regulation, anti-money laundering regulation.

To help us identify instances of non-compliance with these laws and regulations, and in identifying and assessing the risks of material misstatement in respect to non-compliance, our procedures included, but were not limited to:
Inquiring of management and, where appropriate, those charged with governance, as to whether the Company is in compliance with laws and regulations, and discussing their policies and procedures regarding compliance with laws and regulations;
Inspecting correspondence, if any, with relevant licensing or regulatory authorities;
Communicating identified laws and regulations to the engagement team and remaining alert to any indications of non-compliance throughout our audit; and
Considering the risk of acts by the Company which were contrary to applicable laws and regulations, including fraud.  

We also considered those laws and regulations that have a direct effect on the preparation of the financial statements, such as tax legislation, pension legislation, the Companies Act 2006. 
- 6 -

 
MENTAL HEALTH CARE (COMMUNITY) LIMITED
 
 
 
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF MENTAL HEALTH CARE (COMMUNITY) LIMITED
 

In addition, we evaluated the directors' and management's incentives and opportunities for fraudulent manipulation of the financial statements, including the risk of override of controls, and determined that the principal risks were related to posting manual journal entries to manipulate financial performance, management bias through judgements and assumptions in significant accounting estimates, in particular in relation to revenue recognition (which we pinpointed to the cut off assertion), and significant one-off or unusual transactions.

Our audit procedures in relation to fraud included but were not limited to:
Making enquiries of the directors and management on whether they had knowledge of any actual, suspected or alleged fraud;
Gaining an understanding of the internal controls established to mitigate risks related to fraud;
Discussing amongst the engagement team the risks of fraud; and
Addressing the risks of fraud through management override of controls by performing journal entry testing.

There are inherent limitations in the audit procedures described above and the primary responsibility for the prevention and detection of irregularities including fraud rests with management. As with any audit, there remained a risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations or the override of internal controls.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

Use of the audit 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.




Neil Barton (Senior Statutory Auditor)

  
for and on behalf of

Forvis Mazars LLP
Chartered Accountants and Statutory Auditor 
One St. Peter's Square
Manchester
M2 3DE

19 December 2024
- 7 -

 
MENTAL HEALTH CARE (COMMUNITY) LIMITED
 
 
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2024

2024
2023
Note
£
£

  

Turnover
  
2,233,822
1,755,035

Cost of sales
  
(1,154,572)
(989,860)

Gross profit
  
1,079,250
765,175

Administrative expenses
  
(266,332)
(231,214)

Operating profit
  
812,918
533,961

Tax on profit
 5 
2,305
(111,710)

Profit for the financial year
  
815,223
422,251

There were no recognised gains and losses for 2024 or 2023 other than those included in the statement of comprehensive income.

There was no other comprehensive income for 2024 (2023: £NIL).

The notes on pages 11 to 21 form part of these financial statements.

- 8 -

 
MENTAL HEALTH CARE (COMMUNITY) LIMITED
REGISTERED NUMBER: 03179603

STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2024

2024
2023
Note
£
£

Fixed assets
  

Tangible assets
 6 
378,605
136,171

  
378,605
136,171

Current assets
  

Debtors: amounts falling due within one year
 7 
2,484,959
2,129,713

Cash at bank and in hand
 8 
39,609
17,581

  
2,524,568
2,147,294

Creditors: amounts falling due within one year
 9 
(452,131)
(645,341)

Net current assets
  
 
 
2,072,437
 
 
1,501,953

Total assets less current liabilities
  
2,451,042
1,638,124

Provisions for liabilities
  

Deferred tax
 10 
(12,985)
(15,290)

  
 
 
(12,985)
 
 
(15,290)

Net assets
  
2,438,057
1,622,834


Capital and reserves
  

Called up share capital 
 11 
2
2

Profit and loss account
 12 
2,438,055
1,622,832

  
2,438,057
1,622,834


The Company's financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.

The financial statements were approved and authorised for issue by the board and were signed on its behalf on 19 December 2024.




N Kelly
Director

The notes on pages 11 to 21 form part of these financial statements.

- 9 -

 
MENTAL HEALTH CARE (COMMUNITY) LIMITED
 

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2024


Called up share capital
Profit and loss account
Total equity

£
£
£

At 1 July 2022
2
1,200,581
1,200,583


Comprehensive income for the year

Profit for the year
-
422,251
422,251
Total comprehensive income for the year
-
422,251
422,251


At 1 July 2023
2
1,622,832
1,622,834


Comprehensive income for the year

Profit for the year
-
815,223
815,223
Total comprehensive income for the year
-
815,223
815,223


At 30 June 2024
2
2,438,055
2,438,057


The notes on pages 11 to 21 form part of these financial statements.

- 10 -

 
MENTAL HEALTH CARE (COMMUNITY) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024

1.


General information

Mental Health Care (Community) Limited (the 'Company') is a private company limited by shares, incorporated in the United Kingdom and registered in England & Wales. The Company's registered number is 03179603. The registered office is Alexander House, Highfield Park, Llandyrnog, Denbighshire, LL16 4LU.
The Company's principal activity is the provision of residential care for people with learning disabilities and challenging behaviour.
These financial statements have been presented in Pound Sterling as this is the currency of the primary economic environment in which the Company operates.
Monetary amounts in these financial statements have been rounded to the nearest £.

2.Accounting policies

 
2.1

Basis of preparation of financial statements

The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the Company's accounting policies (see note 3).

The following principal accounting policies have been applied:

 
2.2

Financial Reporting Standard 102 - reduced disclosure exemptions

The Company has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by the FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":
the requirements of Section 7 Statement of Cash Flows;
the requirements of Section 3 Financial Statement Presentation paragraph 3.17(d);
the requirements of Section 11 Financial Instruments paragraphs 11.42, 11.44 to 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);
the requirements of Section 12 Other Financial Instruments paragraphs 12.26 to 12.27, 12.29(a), 12.29(b) and 12.29A;
the requirements of Section 33 Related Party Disclosures paragraph 33.7.

This information is included in the consolidated financial statements of MRA UK Investments Limited as at 30 June 2024 and these financial statements may be obtained from the Registrar of Companies whose address is Companies House, Crown Way, Cardiff, CF14 3UZ.

- 11 -

 
MENTAL HEALTH CARE (COMMUNITY) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024

2.Accounting policies (continued)

 
2.3

Going concern

The COVID-19 health outbreak financial impact can now be assessed and it is apparent that the overall affect has not been material in determining the going concern status of the group headed by MRA UK Investments Limited ("the group") and its subsidiaries. The group is still considered to be sufficiently agile to be prepared to respond to any adverse effects that may still arise, to minimise the impact on the financial performance of the group. The Company continues to generate profits and is in a net assets position. 

 
2.4

Revenue

Turnover comprises revenue recognised for the provision of health and social care residential and in-patient services and ancillary services.  Revenue is recognised exclusive of trade discounts and sales taxes.  Revenue paid in advance is included in deferred income until the service is provided.  Revenue in respect of services provided but not yet invoiced by the period end is included within accrued income.

 
2.5

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost 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.

Land is not depreciated. Depreciation on other assets is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.

Depreciation is provided on the following basis:

Freehold property
-
50 years straight line
Motor vehicles
-
5 years straight line
Fixtures & fittings
-
5 years straight line

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.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.

 
2.6

Debtors

Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.

 
2.7

Cash and cash equivalents

Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.

- 12 -

 
MENTAL HEALTH CARE (COMMUNITY) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024

2.Accounting policies (continued)

 
2.8

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.

The Company has elected to apply the recognition and measurement provisions of IFRS 9 Financial Instruments (as adopted by the UK Endorsement Board) with the disclosure requirements of Sections 11 and 12 and the other presentation requirements of FRS 102.

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 trade and other receivables, cash and bank balances, are initially measured at their transaction price including transaction costs and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, 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.

Discounting is omitted where the effect of discounting is immaterial. The Company's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.

Other financial assets

Other financial assets, which includes investments in equity instruments which are not classified as subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the recognised transaction price. Such assets are subsequently measured at fair value with the changes in fair value being recognised in the profit or loss. Where other financial assets are not publicly traded, hence their fair value cannot be measured reliably, they are measured at cost less impairment.

Impairment of financial assets

Financial assets are assessed for indicators of impairment at each reporting date. 

Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.

If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.
 
- 13 -

 
MENTAL HEALTH CARE (COMMUNITY) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024

2.Accounting policies (continued)


2.8
Financial instruments (continued)

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 the deduction of all its liabilities.

Basic financial liabilities, which include trade and other payables, bank loans and other loans are initially measured at their transaction price after transaction costs. When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future receipts discounted at a market rate of interest, discounting is omitted where the effect of discounting is immaterial.

Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.

Trade payables are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade payables are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.

Other financial instruments

Derivatives, including forward exchange contracts, futures contracts and interest rate swaps, are not classified as basic financial instruments. These are initially recognised at fair value on the date the derivative contract is entered into, with costs being charged to the profit or loss. They are subsequently measured at fair value with changes in the profit or loss.

Debt instruments that do not meet the conditions as set out in FRS 102 paragraph 11.9 are subsequently measured at fair value through the profit or loss. This recognition and measurement would also apply to financial instruments where the performance is evaluated on a fair value basis as with a documented risk management or investment strategy.

Derecognition of financial instruments

Derecognition of financial assets

Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Company transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Company will continue to recognise the value of the portion of the risks and rewards retained.

Derecognition of financial liabilities

Financial liabilities are derecognised when the Company's contractual obligations expire or are discharged or cancelled.

- 14 -

 
MENTAL HEALTH CARE (COMMUNITY) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024

2.Accounting policies (continued)

 
2.9

Creditors

Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.

 
2.10

Government grants

Grants are accounted under the accruals model as permitted by FRS 102. Grants relating to expenditure on tangible fixed assets are credited to profit or loss at the same rate as the depreciation on the assets to which the grant relates. The deferred element of grants is included in creditors as deferred income.
Grants of a revenue nature are recognised in the Statement of Comprehensive Income in the same period as the related expenditure.

 
2.11

Pensions

The Company operates a defined contribution pension scheme and the pension charge represents the amounts payable by the Company to the fund in respect of the year.

 
2.12

Provisions for liabilities

Provisions are recognised when an event has taken place that gives rise to a legal or constructive obligation, a transfer of economic benefits is probable and a reliable estimate can be made.
Provisions are measured as the best estimate of the amount required to settle the obligation, taking into account the related risks and uncertainties.
 
Increases in provisions are generally charged as an expense to profit or loss.

- 15 -

 
MENTAL HEALTH CARE (COMMUNITY) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024

2.Accounting policies (continued)

 
2.13

Current and deferred taxation

The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.

The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date in the countries where the Company operates and generates income.

Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the reporting date, except that:
The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.

Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.

- 16 -

 
MENTAL HEALTH CARE (COMMUNITY) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024

3.


Judgements in applying accounting policies and key sources of estimation uncertainty

In applying the Company's accounting policies, the Directors are required to make judgements, estimates and assumptions in determining the carrying amounts of assets and liabilities. The Directors' judgements, estimates and assumptions are based on the best and most reliable evidence available at the time when the decisions are made and are based on historical experience and other factors that are considered to be applicable. Due to the inherent subjectivity involved in making such judgements, estimates and assumptions the actual results and outcomes may differ.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised, if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
Critical judgements in applying the Company's accounting policies
The critical judgements that the Directors have made in the process of applying the Company's accounting policies that have the most significant effect on the amounts recognised in the statutory financial statements are discussed below.
Assessing indicators of impairment
In assessing whether there have been any indicators of impaired assets, the Directors have considered both external and internal sources of information such as market conditions, counterparty credit ratings and experience of recoverability. There have been no indicators of impairments identified during the current financial year.


4.


Employees

The average monthly number of employees, including the Directors, during the year was as follows:


        2024
        2023
            No.
            No.







Service management and care staff
31
29

- 17 -

 
MENTAL HEALTH CARE (COMMUNITY) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024

5.


Taxation


2024
2023
£
£

Corporation tax


Current tax on profits for the year
-
112,772


-
112,772

Deferred tax


Origination and reversal of timing differences
(2,428)
(1,062)

Adjustment in respect of prior periods
123
-

Total deferred tax
(2,305)
(1,062)


Taxation on (loss)/profit on ordinary activities
(2,305)
111,710

Factors affecting tax charge for the year

The tax assessed for the year is lower than (2023 - higher than) the standard rate of corporation tax in the UK of 25% (2023 - 20.5%). The differences are explained below:

2024
2023
£
£


Profit on ordinary activities before tax
812,918
533,961


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2023 - 20.5%)
203,230
109,462

Effects of:


Fixed asset differences
3,079
2,473

Adjustments to tax charge in respect of prior periods - deferred tax
123
(15)

Remeasurement of deferred tax for changes in tax rates
-
(210)

Group relief surrendered / (claimed)
(208,737)
-

Total tax charge for the year
(2,305)
111,710


Factors that may affect future tax charges

There were no factors that may affect future tax charges.

- 18 -

 
MENTAL HEALTH CARE (COMMUNITY) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024

6.


Tangible fixed assets





Freehold property
Motor vehicles
Fixtures & fittings
Total

£
£
£
£



Cost 


At 1 July 2023
85,825
58,053
98,114
241,992


Additions
242,350
19,250
23,538
285,138



At 30 June 2024

328,175
77,303
121,652
527,130



Depreciation


At 1 July 2023
33,736
16,931
55,154
105,821


Charge for the year
3,082
16,886
22,736
42,704



At 30 June 2024

36,818
33,817
77,890
148,525



Net book value



At 30 June 2024
291,357
43,486
43,762
378,605



At 30 June 2023
52,089
41,122
42,960
136,171

Included in freehold property is freehold land at cost of £12,500 (2023 - £12,500), which is not depreciated.


7.


Debtors

2024
2023
£
£


Trade debtors
410,712
261,666

Amounts owed by group undertakings
2,055,060
1,852,956

Other debtors
453
331

Prepayments and accrued income
18,734
14,760

2,484,959
2,129,713


Amounts owed by group undertakings are interest free and repayable on demand.

- 19 -

 
MENTAL HEALTH CARE (COMMUNITY) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024

8.


Cash and cash equivalents

2024
2023
£
£

Cash at bank and in hand
39,609
17,581



9.


Creditors: Amounts falling due within one year

2024
2023
£
£

Trade creditors
96,407
19,212

Amounts owed to group undertakings
230,410
375,536

Corporation tax
-
112,772

Other taxation and social security
22,386
19,208

Other creditors
4,786
3,046

Accruals and deferred income
98,142
115,567

452,131
645,341


Amounts owed to group undertakings are interest free and repayable on demand.


10.


Deferred taxation




2024
2023


£

£






At beginning of year
(15,290)
(16,352)


Charged to profit or loss
2,305
1,062



At end of year
(12,985)
(15,290)

The provision for deferred taxation is made up as follows:

2024
2023
£
£


Fixed asset timing difference
(13,459)
(15,586)

Short term timing difference
474
296

(12,985)
(15,290)

- 20 -

 
MENTAL HEALTH CARE (COMMUNITY) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2024

11.


Share capital

2024
2023
£
£
Allotted, called up and fully paid



2 (2023 - 2) Ordinary shares of £1 each
2
2

The Company has one class of ordinary shares which carry voting rights, but no right to fixed income.



12.


Reserves

Profit & loss account

The profit & loss account comprises accumulated profits and losses less any dividends declared by the Statement of Financial Position date. 


13.


Pension commitments

The Company operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Company in an independently administered fund. The pension cost charge represents contributions payable by the Company to the fund and amounted to £17,246 (2023 - £15,988). Contributions totalling £4,756 (2023 - £3,015) were payable to the fund at the Statement of Financial Position date and are included in creditors.


14.


Related party transactions

The group have taken advantage of the exemption available under FRS 102 section 33 relating to the disclosure of related party transactions between wholly owned group companies.
During the year rent of £9,000 (2023 - £13,790) was paid to other related parties.
No other transactions with related parties were undertaken such as are required to be disclosed under FRS102 section 33.


15.


Ultimate parent undertaking and controlling party

The immediate parent company is MHC (Social Care) Limited, a Company incorporated in England and Wales.
The smallest company into which the Company is consolidated is Mental Health Care (U.K) Limited, copies of these financial statements are available from Companies House. 
The Company's ultimate parent undertaking is MRA UK Investments Limited, a Company registered in England and Wales, which prepares consolidated financial statements and is the largest group into which the Company is consolidated. As at 30 June 2024 the Company's ultimate controlling party was Mr M Adey. 

- 21 -