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Registered number: 09920594










THE TERRACE HOTEL LIMITED










DIRECTORS' REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2023

 
THE TERRACE HOTEL LIMITED
 
 
COMPANY INFORMATION


Directors
Simon Ball (resigned 7 February 2023)
David Fuller (resigned 9 October 2024)
Emily Jayne Harris (appointed 7 February 2023)
Neil Smith (appointed 9 October 2024)




Registered number
09920594



Registered office
5 New Street Square

London

EC4A 3TW




Independent auditors
HaysMac LLP

10 Queen Street Place

London

EC4R 1AG





 
THE TERRACE HOTEL LIMITED
 

CONTENTS



Page
Directors' Report
 
1
Directors' Responsibilities Statement
 
2
Independent Auditors' Report
 
3 - 6
Statement of Comprehensive Income
 
7
Statement of Financial Position
 
8
Statement of Changes in Equity
 
9
Notes to the Financial Statements
 
10 - 20


 
THE TERRACE HOTEL LIMITED
 
 
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2023

The directors present their report and the financial statements for the year ended 31 December 2023.

Principal activity

The principal activity of the company continued to be that of the operation of a hotel.

Results and dividends

The profit for the year, after taxation, amounted to £583,819 (2022 - £291,109).

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

Directors

The directors who served during the year were:

Simon Ball (resigned 7 February 2023)
David Fuller (resigned 9 October 2024)
Emily Jayne Harris (appointed 7 February 2023)

Qualifying third party indemnity provisions

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

Disclosure of information to auditors

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

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

Auditors

The auditorsHaysMac LLPwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

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





Emily Jayne Harris
Director

Date: 14 March 2025

Page 1

 
THE TERRACE HOTEL LIMITED
 
 
DIRECTORS' RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2023

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 judgments 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.

Page 2

 
THE TERRACE HOTEL LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THE TERRACE HOTEL LIMITED
 

Opinion


We have audited the financial statements of The Terrace Hotel Limited (the 'Company') for the year ended 31 December 2023, which comprise the Statement of Comprehensive Income, the Statement of Financial Position, the Statement of Changes in Equity and the related notes, including a summary of significant accounting policiesThe 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:


give a true and fair view of the state of the Company's affairs as at 31 December 2023 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 Auditors' 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 United Kingdom, including the Financial Reporting Council'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.


Page 3

 
THE TERRACE HOTEL LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THE TERRACE HOTEL LIMITED (CONTINUED)


Other information


The other information comprises the information included in the Annual Report other than the financial statements and our Auditors' Report thereon. The directors are responsible for the other information contained within the Annual ReportOur 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.


Opinion 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 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 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; or
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 from the requirement to prepare a Strategic Report.


Responsibilities of directors
 

As explained more fully in the Directors' Responsibilities Statement set out on page 2, 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,
Page 4

 
THE TERRACE HOTEL LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THE TERRACE HOTEL LIMITED (CONTINUED)


or have no realistic alternative but to do so.


Auditors' 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 Auditors' 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.


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

Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud
Based on our understanding of the Company and industry, we identified that the principal risks of non- compliance with laws and regulations are food safety and hygiene, licensing and and minimum wage regulations and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006 and tax regulation.

We evaluated 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 inappropriate journal entries to revenue and management bias in accounting estimates. Audit procedures performed by the engagement team included: 

inspecting correspondence with regulators and tax authorities;
consideration of known or suspected instances of non-compliance with laws and regulations through discussion with management, review of board minutes, and review of the Food Standards Agency website;
evaluating management’s controls designed to prevent and detect irregularities;
identifying and testing journals, in particular journal entries posted with large values versus averages, key words, postings with high value transactions or rounded entries; and
challenging assumptions and judgements made by management in their critical accounting estimates.

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
 
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.


A further description of our responsibilities for the audit of the financial statements is located on the Financial
Page 5

 
THE TERRACE HOTEL LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THE TERRACE HOTEL LIMITED (CONTINUED)


Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors' 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 2006Our 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 Auditors' 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.





Jessica Edwards (Senior Statutory Auditor)
for and on behalf of
HaysMac LLP
Statutory Auditors
10 Queen Street Place
London
EC4R 1AG

14 March 2025
Page 6

 
THE TERRACE HOTEL LIMITED
 
 
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2023

2023
2022
Note
£
£

  

Turnover
 4 
4,665,011
3,422,794

Cost of sales
  
(1,477,004)
(1,224,372)

Gross profit
  
3,188,007
2,198,422

Administrative expenses
  
(1,746,301)
(2,021,998)

Fair value movements
  
239,996
-

Operating profit
 6 
1,681,702
176,424

Interest payable and similar expenses
 7 
(864,423)
(472,520)

Profit/(loss) before tax
  
817,279
(296,096)

Tax on profit/(loss)
 8 
(233,460)
587,205

Profit for the financial year
  
583,819
291,109

There was no other comprehensive income for 2023 (2022:£NIL).

Page 7

 
THE TERRACE HOTEL LIMITED
REGISTERED NUMBER: 09920594

STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2023

2023
2022
Note
£
£

Fixed assets
  

Tangible assets
 9 
15,642,771
15,761,695

  
15,642,771
15,761,695

Current assets
  

Stocks
 10 
13,481
19,554

Debtors: amounts falling due within one year
 11 
1,583,457
10,295,353

Cash at bank and in hand
 12 
61,928
115,486

  
1,658,866
10,430,393

Creditors: amounts falling due within one year
 13 
(940,508)
(15,434,792)

Net current assets/(liabilities)
  
 
 
718,358
 
 
(5,004,399)

Total assets less current liabilities
  
16,361,129
10,757,296

Creditors: amounts falling due after more than one year
 14 
(13,363,998)
(11,141,758)

Provisions for liabilities
  

Deferred tax
 16 
(352,351)
(118,891)

  
 
 
(352,351)
 
 
(118,891)

Net assets/(liabilities)
  
2,644,780
(503,353)


Capital and reserves
  

Called up share capital 
 18 
6,001,268
6,001,268

Share premium account
  
298,732
298,732

Other reserves
  
3,313,960
749,646

Profit and loss account
  
(6,969,180)
(7,552,999)

  
2,644,780
(503,353)


The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime and in accordance with the provisions of FRS 102 Section 1A - small entities.

The financial statements were approved and authorised for issue by the board and were signed on its behalf on 14 March 2025.


Emily Jayne Harris
Director

Page 8

 
THE TERRACE HOTEL LIMITED
 

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2023


Called up share capital
Share premium account
Other reserves
Profit and loss account
Total equity

£
£
£
£
£


At 1 January 2022 (as previously stated)
6,001,268
298,732
-
(7,423,932)
(1,123,932)

Prior year adjustment - correction of error
-
-
220,633
(420,176)
(199,543)


At 1 January 2022 (as restated)
6,001,268
298,732
220,633
(7,844,108)
(1,323,475)


Comprehensive income for the year

Loss for the year as restated
-
-
-
291,109
291,109
Total comprehensive income for the year
-
-
-
291,109
291,109


Contributions by and distributions to owners

Equity component in shareholder loans
-
-
529,013
-
529,013


Total transactions with owners
-
-
529,013
-
529,013



At 1 January 2023 (as previously stated)
6,001,268
298,732
749,646
(7,132,823)
(83,177)

Prior year adjustment - correction of error
-
-
-
(420,176)
(420,176)


At 1 January 2023 (as restated)
6,001,268
298,732
749,646
(7,552,999)
(503,353)


Comprehensive income for the year

Profit for the year
-
-
-
583,819
583,819
Total comprehensive income for the year
-
-
-
583,819
583,819


Contributions by and distributions to owners

Equity component in shareholder loans
-
-
2,564,314
-
2,564,314


Total transactions with owners
-
-
2,564,314
-
2,564,314


At 31 December 2023
6,001,268
298,732
3,313,960
(6,969,180)
2,644,780


The notes on pages 10 to 20 form part of these financial statements.

Page 9

 
THE TERRACE HOTEL LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

1.


General information

The Terrace Hotel Limited is a private company limited by shares and is registered and incorporated in England and Wales. The registered office is 5 New Street Square, London, EC4A 3TW.
The company's principal activities and nature of its operations are disclosed in the Directors’ Report. 

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 FRS 102 'The Financial Reporting Standard applicable in the UK and the Republic of Ireland' and the requirements of the Companies Act 2006. The disclosure requirements of Section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.

The following principal accounting policies have been applied:

 
2.2

Going concern

The financial statements have been prepared on a going concern basis. 
The Company has net assets of £2.6m as at 31 December 2023 (net liability of £503,353 at December 2022). The financial statements have been prepared on a going concern basis which the directors consider to be appropriate for the following reasons. 
The directors have prepared cash flow forecasts for the 12 month period to March 2026.  The Company’s cash flow forecasts indicate that in the forecast period the Company will have sufficient funds. 
The Company meets its day-to-day working capital requirements through cash generated by operations, debt facilities which contain financial covenants, and intercompany balances. The Company secured debt in February 2022 as part of a wider portfolio financing. 
Consequently, the directors are confident that the company will have sufficient funds to continue to meet its liabilities as they fall due for at least 12 months from the date of approval of the financial statements and have prepared the financial statements on a going concern basis.

Page 10

 
THE TERRACE HOTEL LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.3

Turnover

Turnover, which is stated net of value added tax, represents amounts receivable from the provision of goods and services which fall within the company’s principal activity of hotel operations.

All turnover arose in the United Kingdom
Sale of goods
The company operates restaurants and bars at the hotel. Sales of goods are recognised when the
restaurant and bars sell a product to a customer.
Sale of services
The company supplies conference and event facilities as well as hotel rooms to businesses and
private customers. Sales of rooms and conference and event facilities are recognised on the dates
those facilities are used. Deposits received in advance are not recognised as turnover until the date
of the stay or event.

 
2.4

Tangible fixed assets

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

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, on the following bases:.


Freehold property
-
periods up to 50 years
Fixtures and fittings
-
3-10 years straight line
Computer equipment
-
1-5 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.

 
2.5

Cash and cash equivalents

Cash and cash equivalents are basic financial instruments and include cash in hand and deposits held at call with banks.

Page 11

 
THE TERRACE HOTEL LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.6

Stocks

Stocks are stated at the lower of cost and estimated selling price.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognise as an impairment loss in profit or loss. Reversals of impairment losses are also recognise in profit or loss. 



 
2.7

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.

 
2.8

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.

 
2.9

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.


Page 12

 
THE TERRACE HOTEL LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.10

Pensions

Defined contribution pension plan

The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.

The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Statement of Financial Position. The assets of the plan are held separately from the Company in independently administered funds.


3.


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 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.
Key sources of estimation uncertainty
Tangible fixed assets impairment
Determining whether there are indicators of impairment of the Company's tangible assets is a key judgement. The factors considered when making a judgement around fixed impairment include the economic viability and expected future financial performance of the asset and, where it is a component of a larger cash generating unit, the viability and expected future performance of that unit.
Tangible fixed asset residual value
Tangible fixed assets are depreciated over their useful lives taking into account residual values, where appropriate. The actual lives of the assets and residual values are assessed annually and may vary depending on a number of factors. In re-assessing asset lives, factors such as life cycles and maintenance programmes are taken into account. Residual value assessments consider these issues.
 

Page 13

 
THE TERRACE HOTEL LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

4.


Turnover

An analysis of turnover by class of business is as follows:


2023
2022
£
£

Hotel operation
4,665,011
3,422,794


All turnover arose within the United Kingdom.


5.


Employees

2023
2022
£
£

Wages and salaries
1,153,917
993,478

Social security costs
81,363
78,330

Cost of defined contribution scheme
20,608
17,409

1,255,888
1,089,217


The average monthly number of employees, including directors, during the year was 52 (2022 - 16).


6.


Operating loss

The operating loss is stated after charging:

2023
2022
£
£

Depreciation of owned tangible fixed assets
457,189
548,685

Fees payable to the company's auditor for the audit of the company's financial statments
23,000
19,250

480,189
567,935


7.


Interest payable and similar expenses

2023
2022
£
£


Interest on bank overdrafts and loans
501,684
472,520

Other loan interest payable
362,739
-

864,423
472,520

Page 14

 
THE TERRACE HOTEL LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

8.


Taxation


2023
2022
£
£


Total current tax
-
-

Deferred tax


Origination and reversal of timing differences
233,460
(587,205)

Total deferred tax
233,460
(587,205)


Tax on profit/(loss)
233,460
(587,205)

Factors affecting tax charge for the year

The tax assessed for the year is higher than (2022 - lower than) the standard rate of corporation tax in the UK of 23.52% (2022 - 19%). The differences are explained below:

2023
2022
£
£


Profit/(loss) on ordinary activities before tax
817,279
(296,096)


Profit/(loss) on ordinary activities multiplied by standard rate of corporation tax in the UK of 23.52% (2022 - 19%)
192,228
(56,258)

Effects of:


Fixed asset timing differences
67,052
60,887

Remeasurement of deferred tax for changes in tax rates
13,816
1,469

Capital allowances for year in excess of depreciation
85,399
18

Movement in deferred tax not recognised
(6)
(593,326)

Income not taxable for tax purposes
(125,041)
-

Other permanent differences
12
-

Other adjustments, reliefs and transfers
-
4

Unexplained difference
-
1

Total tax charge for the year
233,460
(587,205)

Page 15

 
THE TERRACE HOTEL LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

9.


Tangible fixed assets





Freehold land and buildings
Fixtures and fittings
Computers
Total

£
£
£
£



Cost or valuation


At 1 January 2023
17,204,671
4,138,459
79,871
21,423,001


Additions
12,093
314,665
11,506
338,264



At 31 December 2023

17,216,764
4,453,124
91,377
21,761,265



Depreciation


At 1 January 2023
3,536,917
2,070,297
54,092
5,661,306


Charge for the year on owned assets
35,193
405,963
16,032
457,188



At 31 December 2023

3,572,110
2,476,260
70,124
6,118,494



Net book value



At 31 December 2023
13,644,654
1,976,864
21,253
15,642,771



At 31 December 2022
13,667,754
2,068,162
25,779
15,761,695

Included in freehold property is freehold land at a cost of £4,577,718 (2022: £4,577,718) which is not depreciated.


10.


Stocks

2023
2022
£
£

Food and beverage stock and consumables
13,481
19,554


The difference between the purchase price of stocks and their replacement cost is not material.

Page 16

 
THE TERRACE HOTEL LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

11.


Debtors

2023
2022
£
£


Trade debtors
168,070
14,563

Related party receivables
636,592
10,214,400

Other debtors
125,081
-

Prepayments and accrued income
90,390
66,390

Financial instruments
563,324
-

1,583,457
10,295,353



12.


Cash and cash equivalents

2023
2022
£
£

Cash at bank and in hand
61,928
115,486

Less: bank overdrafts
(71)
-

61,857
115,486



13.


Creditors: Amounts falling due within one year

2023
2022
£
£

Bank overdrafts
71
-

Bank loans
240,000
-

Trade creditors
298,927
199,581

Amounts owed to group undertakings
-
14,947,500

Other creditors
8,653
12,253

Accruals and deferred income
296,774
192,729

Other taxation and social security
96,083
82,729

940,508
15,434,792


All loans from group companies are interest free and repayable on demand.

Page 17

 
THE TERRACE HOTEL LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

14.


Creditors: Amounts falling due after more than one year

2023
2022
£
£

Bank loans and overdrafts
9,120,000
10,214,400

Other loans
4,243,998
927,358


The bank loan is due for repayment in February 2027. Interest is charged at  a margin determined by the reference to the entity's leverage plus the SONIA rate at the interest payment date. Interest on the bank loans is fully hedged by an interest rate cap arrangement entered with the Bank of Ireland. Other loans are made up of shareholder loans that are interest free and are due for repayment in 2031.


15.


Loans


Analysis of the maturity of loans is given below:


2023
2022
£
£

Amounts falling due within one year

Bank loans
240,000
-


240,000
-

Amounts falling due 1-2 years

Bank loans
9,120,000
-

Amounts falling due 2-5 years

Bank loans
-
10,214,400

Other loans
4,243,998
927,358

4,243,998
927,358


Page 18

 
THE TERRACE HOTEL LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

16.


Deferred taxation




2023


£






At beginning of year
(118,891)


Charged to the profit or loss
(233,460)



At end of year
(352,351)

The provision for deferred taxation is made up as follows:

2023
2022
£
£


Fixed asset timing differences
(860,211)
(777,563)

Short term timing differencs
988
16,522

Losses and other deductions
506,872
642,150

(352,351)
(118,891)


17.


Pensions



2023
2022

£
£

Charge to profit or loss in respect of defined contribution schemes
17,409
5,361

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. Contributions totalling £3,938 (2022: £3,547) were payable to the fund at the balance sheet date and
are included in creditors.



18.


Share capital

2023
2022
£
£
Allotted, called up and fully paid



6,000,000 A Ordinary shares of £1.00 each
6,000,000
6,000,000
126,826126,826 B Ordinary shares of £0.01 each
1,268
1,268

6,001,268

6,001,268


Page 19

 
THE TERRACE HOTEL LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2023

19.


Related party transactions

The company has taken exemption under Section 33.1A of FRS 102 not to disclose transactions with other wholly owned group companies on the grounds that 100% of the voting rights in the company are controlled within that group.
Key management personnel include all directors and a number of senior managers and consultants of the company who together have authority and responsibility for planning, directing and controlling the activities of the group. The total compensation paid to key management personnel for services provided to the company was £nil (2022- £niI).


20.


Ultimate controlling party

The ultimate parent undertaking and controlling party is Castleforge Fund III LP, incorporated in Guernsey.

Page 20