NORTH KENSINGTON GATE HGP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 JULY 2024
2.Accounting policies (continued)
The directors accept that although there does exist an inherent uncertainty that may cast doubt about the ability of the Company to continue as a going concern, as is the case with all companies; the directors consider the uncertainty to be sufficiently insignificant, given the Company's observed operational activity during the year ended 30 November 2023, expected operational activity for the foreseeable future, net asset position as at the balance sheet date and availability of adequate financial resources to meet the Company's operational cash flow requirements, such that the application of going concern basis in preparing the Company's financial statements remains appropriate. The directors have therefore prepared the Company's financial statements under the going concern basis.
Fixed asset investments comprise of holdings in unlisted shares of subsidiary undertakings. Such holdings are a form of financial instrument and are initially recognised at their transaction cost and subsequently measured at cost less provision for impairment at the balance sheet date.
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.
The Company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities; with said financial assets and liabilities classified in accordance with the substance of the underlying contractual obligations rather than its legal form.
Financial assets and liabilities are recognised in the balance sheet upon becoming party to the contractual provisions of the instrument. Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or the financial asset is transferred along with substantially all the risks and rewards of ownership of the asset to another party.
Financial liabilities are derecognised only when the Company’s obligations are discharged, cancelled or expired.
The measurement of specific financial assets, financial liabilities and equity is outlined below:
Debtors
Debtors are initially measured at transaction price (i.e fair value) and subsequently held at transaction price less provision for impairment.
Cash and cash equivalents
Cash balances are reported by the Company as being financial instruments classified as short term receivables and are represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours and subject to an insignificant risk of changes in value. Cash balances are held at floating interest rates linked to UK bank rates.
Equity
Ordinary share capital, shown in equity, is initially measured and subsequently held at its nominal value. Where the transaction price for issued shares exceeds their nominal value, the difference is
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