Wot-an-Egg 2020 Ltd is a private company limited by shares incorporated in England and Wales. The registered office is High Warrendale Farm, Warter, York, East Yorkshire, United Kingdom, YO42 1XG.
The Company extended its comparative accounting reference date from 30 September to 31 December 2022, reporting a 15 month accounting period. The current period presented is that of a year only. As such, the comparative amounts presented in the financial statements (including the related notes) may not be entirely comparable.
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 £.
As with any company placing reliance on other group entities for financial support, the Directors acknowledge that there can be no certainty that this support will continue and are aware that if multiple of the groups business risks crystallise simultaneously and the Group is unable to secure the necessary refinancing or additional funding, this would cast significant doubt on the Group’s ability to continue as a going concern, potentially leading to an inability to provide the required support to the Company.
The Directors acknowledge the existence of a material uncertainty regarding the Company’s ability to continue as a going concern but have a reasonable expectation that the Company has access to sufficient resources to continue its operations for the foreseeable future.
Therefore, the financial statements have been prepared on a going concern basis.
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.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
Basic financial assets, which include debtors, amounts owed by fellow group companies and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.
Financial 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, including creditors, loans and loans from fellow group companies are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.
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.
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.
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.
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.
Investment property is measured at fair value based on valuations performed by managements expert with experience of valuing such properties. Due to the specialised nature of these properties, measurement of fair value contains a higher degree of judgement and estimation in arriving at a suitable value at which to state the investment property in the statement of financial position. Key areas within the valuation where judgement and estimation have been applied are the vacant property value, the rental yield and the discount rate used in the valuation method applied. The carrying value of investment properties at the period end is £2,908,793 (2022: £2,503,207).
Included within other operating income is £980,000 relating to a one off surrender charge receivable from early surrender of the property lease during the year.
The average monthly number of persons (including directors) employed by the company during the year was:
The fair value of the investment properties have been valued by management's expert who has experience in valuing such properties. The valuation method used was a term and reversion method. Significant assumptions within this valuation are the vacant property value, rental yield and vacant property discount rate used in the valuation method applied.
Amounts owed by group undertakings consist of intercompany loans, which are unsecured, bear no interest and are repayable on demand. These are stated net of a provision for bad debts of £59,445 (2022: £15,000).
Amounts owed by group undertakings consist of intercompany loans, which are unsecured, bear no interest and are repayable on demand.
Other borrowings are comprised of secured borrowings carrying interest at 7.74%, repayable in instalments and due to be repaid in full in December 2038. Security was provided for this loan by way of a fixed and floating charge dated 22 December 2023 which covers all the property or undertaking of the company. The charge contains a negative pledge.
In the previous period, bank loans consisted of borrowings with Oxbury Bank PLC, secured by way of fixed and floating charges dated 11 May 2021 and 28 May 2021 over all the property or undertaking of the company. The charges contained a negative pledge and were satisfied on 22 December 2023.
As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:
The auditor's report was unqualified.
Subsequent to the year end, the company has not met post drawdown conditions attached to its long-term loans. Consequently, the affected long-term borrowings totalling £519,465 have become immediately repayable at the discretion of the financier. The Group has accepted an offer of debt funding from the financier, and both the financier and the Directors continue, on a completely consensual basis to reorganise the group and refinance all existing debt into the new structure. Once completed this will satisfy both hire purchase liabilities and post drawdown conditions.