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Registered number: 14748818










SOUTHERN HOMEMOVE LTD










ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 31 DECEMBER 2023

 
SOUTHERN HOMEMOVE LTD
 
 
COMPANY INFORMATION


Directors
A Ackhurst (appointed 18 April 2023)
L Heanley (appointed 22 March 2023)
B Keating (appointed 18 April 2023)




Registered number
14748818



Registered office
44 Coombe Lane

London

SW20 0LA




Independent auditors
Larking Gowen LLP
Chartered Accountants & Statutory Auditors

1st Floor, Prospect House

Rouen Road

Norwich

NR1 1RE





 
SOUTHERN HOMEMOVE LTD
 

CONTENTS



Page
Group strategic report
 
1 - 2
Directors' report
 
3 - 4
Independent auditors' report
 
5 - 8
Consolidated statement of comprehensive income
 
9
Consolidated statement of financial position
 
10
Company statement of financial position
 
11
Consolidated statement of changes in equity
 
12
Company statement of changes in equity
 
13
Consolidated statement of cash flows
 
14
Consolidated analysis of net debt
 
15
Notes to the financial statements
 
16 - 39


 
SOUTHERN HOMEMOVE LTD
 
 
GROUP STRATEGIC REPORT
FOR THE PERIOD ENDED 31 DECEMBER 2023

Introduction
 
The directors present their strategic report for the period from incorporation on 22 March 2023 to 31 December 2023.

Business review
 
Southern Homemove Limited owns 4 subsidiary companies acquired from LSLi Limited, as detailed in Note 13.
On 4 May 2023, LSL Property Services plc announced that its entire owned estate agency network would become franchises. 
On 5 May 2023, Southern Homemove Limited acquired 100% of the share capital of 4 businesses from LSLi Limited. On the same date a franchise agreement was entered into between LSLi Limited, Southern Homemove Limited and the 4 new subsidiaries, the franchisees. All of the businesses changed their names shortly after being acquired but continue to trade in the same manner and continue to use the existing brands.
A strategic review was undertaken in the period immediately after acquisition as all businesses as franchisees were subject to franchise fees, which impacted profitability.
The review identified that EALAU Limited’s ongoing losses could not be sustained as a franchisee and the business was closed with part of its operation transferred to EAHAW Ltd. EALAU limited is in a position of net liabilities supported by the Group, and has ceased trading post year-end and as such this company was not deemed a going concern.
EADTL Limited needed to rationalise its operation to sustain profitability as a franchisee and 5 branches were closed in December 2023 incurring closure provisions and costs.

Financial key performance indicators
 
The Group made an operating loss of £42k. The Company's key financial and other performance indicators during the period were as follows:
     
2023
     £'000 
Revenue    9,167
Operating loss   42
Operating loss margin  0.5%
Whilst these are the first financial statements prepared by the Group, revenue generated by subsidiaries decreased year on year with macro-economic factors such as UK interest rate rises weighing on results. Profitability has been impacted by additional franchise fees levied on the Group's revenue from 5 May 2023.

Page 1

 
SOUTHERN HOMEMOVE LTD
 

GROUP STRATEGIC REPORT (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023

Principal risks and uncertainties
 
The principal risks and uncertainties facing the Group are as follows:
Market Risk
The volume of house sales and the Group's revenue and profitability could be adversely affected by the following external factors:
the housing market;
customer behaviour;
competition from other estate agents; and
changes in legislation.

The Group continues to manage these risks through risk reviews at regular board meetings. 
Operational Risk
The Group's results could also be affected by the following internal factors:
failure to recruit or retain key staff;
failure of information systems;
failure to comply with relevant legislation; and
failure of the franchise model.

Strategic changes made have mitigated the risk to the Group.


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



B Keating
Director

Date: 2 April 2025

Page 2

 
SOUTHERN HOMEMOVE LTD
 
 
 
DIRECTORS' REPORT
FOR THE PERIOD ENDED 31 DECEMBER 2023

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

Principal activity

The Company's principal activity is that of a Group whose principal activity is the provision of estate agency services and related activities.

Directors

The directors who served during the period were:

A Ackhurst (appointed 18 April 2023)
L Heanley (appointed 22 March 2023)
B Keating (appointed 18 April 2023)

Results and dividends

The profit for the period, after taxation, amounted to £38,000.

There were no dividends paid or proposed by the Company in the period.

Directors' responsibilities statement

The directors are responsible for preparing the Group strategic report, the Directors' report and the consolidated 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 the Group and of the profit or loss of the Group for that period.

 In preparing these financial statements, the directors are required to:


select suitable accounting policies for the Group'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 Group 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 the Group 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 the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Future developments

The Company will continue to undertake measures to optimise its trading performance, to protect margins and EBITDA, whilst retaining and augmenting talent to ensure it is well placed to take advantage of future market developments.

Page 3

 
SOUTHERN HOMEMOVE LTD
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE PERIOD ENDED 31 DECEMBER 2023

Qualifying third party indemnity provisions

During the year the Company maintained liability insurance for its directors and officers. This provision, which is a qualifying third party indemnity provision as defined by Section 234 of the Companies Act 2006, was in force throughout the year and is currently in force. Neither the Company's indemnity nor insurance provides cover in the event that a director or officer is proved to have acted fraudulently or dishonestly.

Matters covered in the Group strategic report

The following matters have been included in the strategic report:
Business review
Financial key performance indicators
Principal risks and uncertainties

Auditors

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

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 and the Group'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 and the Group's auditors are aware of that information.

Post balance sheet events

On 6 February 2024, a further 100 Ordinary Shares of £1 each were allotted.

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





B Keating
Director

Date: 2 April 2025

Page 4

 
SOUTHERN HOMEMOVE LTD
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SOUTHERN HOMEMOVE LTD
 

Opinion


We have audited the financial statements of Southern HomeMove Ltd (the 'parent Company') and its subsidiaries (the 'Group') for the period ended 31 December 2023, which comprise the Consolidated statement of comprehensive income, the Consolidated statement of financial position, the Company statement of financial position, the Consolidated statement of cash flows, the Consolidated statement of changes in equity, the Company 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 Group's and of the parent Company's affairs as at 31 December 2023 and of the Group's loss for the period 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 Group 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 Group's or the parent 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 5

 
SOUTHERN HOMEMOVE LTD
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SOUTHERN HOMEMOVE LTD (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 Group strategic report and the Directors' report for the financial period for which the financial statements are prepared is consistent with the financial statements; and
the Group strategic report and the Directors' report have 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 Group and the parent Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group 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:

adequate accounting records have not been kept by the parent Company, or returns adequate for our audit have not been received from branches not visited by us; or
the parent Company 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.


Responsibilities of directors
 

As explained more fully in the Directors' responsibilities statement set out on page 3, 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 Group's and the parent 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 Group or the parent Company or to cease operations, or have no realistic alternative but to do so.

Page 6

 
SOUTHERN HOMEMOVE LTD
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SOUTHERN HOMEMOVE LTD (CONTINUED)



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 Group 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:

Due to the field in which the Group operates, we identified the areas most likely to have a direct material impact on the financial statements as compliance with UK tax legislation, UK accounting standards and the Companies Act 2006. In addition, we considered the provisions of other laws and regulations which whilst not having a direct impact on the financial statements, are fundamental to the Group's ability to operate including health and safety, employment law, GDPR and compliance with FCA rules.

Our approach to identifying and assessing the risk of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, included the following:

Enquiries with management about any known or suspected instances of non-compliance with laws and regulations and fraud;
Reviewing legal and professional fees to confirm all matters where the Group engaged lawyers during the year;
Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations;
Reviewing the reports and findings from client money Propertymark audits to ensure all applicable requirements are being complied with;
Challenging assumptions and judgements made by management in their significant accounting estimates, in particular in relation to the value of stock held; and
Auditing the risk of management override of controls, including through testing journal entries and other adjustments for appropriateness, and evaluating the business rationale of significant transactions outside the normal course of business.


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


Page 7

 
SOUTHERN HOMEMOVE LTD
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF SOUTHERN HOMEMOVE LTD (CONTINUED)


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.





John Atkins ACA FCCA (Senior statutory auditor)
  
for and on behalf of
Larking Gowen LLP
 
Chartered Accountants
Statutory Auditors
  
1st Floor, Prospect House
Rouen Road
Norwich
NR1 1RE

 
Date: 
3 April 2025
Page 8

 
SOUTHERN HOMEMOVE LTD
 
 
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED 31 DECEMBER 2023

Period ended
31 December
2023
Note
£000

  

Turnover
 4 
9,167

Cost of sales
  
(1,851)

Gross profit
  
7,316

Administrative expenses
  
(7,358)

Operating (loss)/profit
  
(42)

Interest payable and similar expenses
 9 
(128)

(Loss)/profit before taxation
  
(170)

Tax on (loss)/profit
 10 
208

Profit for the financial period
  
38

Profit for the period attributable to:
  

Owners of the parent Company
  
38

  
38

There was no other comprehensive income for 2023.

The notes on pages 16 to 39 form part of these financial statements.

Page 9

 
SOUTHERN HOMEMOVE LTD
REGISTERED NUMBER: 14748818

CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2023

2023
Note
£000

Fixed assets
  

Fixed lettings book fee
 11 
1,817

Goodwill
 11 
3

Computer software
 11 
74

Negative goodwill
 11 
(721)

Tangible assets
 12 
218

  
1,391

Current assets
  

Debtors
 14 
1,747

Cash at bank and in hand
 15 
1,599

  
3,346

Creditors: amounts falling due within one year
 16 
(2,985)

Net current assets
  
 
 
361

Total assets less current liabilities
  
1,752

Creditors: amounts falling due after more than one year
 17 
(1,618)

Provisions for liabilities
  

Other provisions
 19 
(96)

  
 
 
(96)

Net assets
  
38


Capital and reserves
  

Profit and loss account
 21 
38

  
38


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 




B Keating
Director

Date: 2 April 2025

The notes on pages 16 to 39 form part of these financial statements.

Page 10

 
SOUTHERN HOMEMOVE LTD
REGISTERED NUMBER: 14748818

COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2023

2023
Note
£000

Fixed assets
  

Tangible assets
 12 
2

  
2

Current assets
  

Debtors
 14 
65

Cash at bank and in hand
 15 
221

  
286

Creditors: amounts falling due within one year
 16 
(275)

Net current assets
  
 
 
11

Total assets less current liabilities
  
13

  

Net assets
  
13


Capital and reserves
  

Profit for the period
 21 
13

Profit and loss account carried forward
 21 
13

  
13


The financial statements were approved and authorised for issue by the board and were signed on its behalf by: 


B Keating
Director

Date: 2 April 2025

The notes on pages 16 to 39 form part of these financial statements.

Page 11

 
SOUTHERN HOMEMOVE LTD
 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 31 DECEMBER 2023


Profit and loss account
Equity attributable to owners of parent Company
Total equity

£000
£000
£000


Comprehensive income for the period

Profit for the period
38
38
38


At 31 December 2023
38
38
38

The notes on pages 16 to 39 form part of these financial statements.

Page 12

 
SOUTHERN HOMEMOVE LTD
 

COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 31 DECEMBER 2023


Profit and loss account
Total equity

£000
£000


Comprehensive income for the period

Profit for the period
13
13


At 31 December 2023
13
13

The notes on pages 16 to 39 form part of these financial statements.

Page 13

 
SOUTHERN HOMEMOVE LTD
 

CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED 31 DECEMBER 2023

2023
£000

Cash flows from operating activities

Profit for the financial period
38

Adjustments for:

Amortisation of intangible assets
139

Depreciation of tangible assets
91

Loss on disposal of tangible assets
24

Unwinding of discount on franchise fee liability
128

Taxation charge
(208)

Increase in debtors
(439)

Increase in creditors
878

Increase in provisions
96

Net cash generated from operating activities

747


Cash flows from investing activities

Purchase of tangible fixed assets
(7)

Net cash acquired with subsidiaries
693

Net cash from investing activities

686

Cash flows from financing activities

Franchise fee payments
166

Net cash used in financing activities
166

Net increase in cash and cash equivalents
1,599

Cash and cash equivalents at the end of period
1,599


Cash and cash equivalents at the end of period comprise:

Cash at bank and in hand
1,599

1,599


The notes on pages 16 to 39 form part of these financial statements.

Page 14

 
SOUTHERN HOMEMOVE LTD
 

CONSOLIDATED ANALYSIS OF NET DEBT
FOR THE PERIOD ENDED 31 DECEMBER 2023




Cash flows
Acquisition and disposal of subsidiaries
At 31 December 2023
£000

£000

£000

Cash at bank and in hand

906

693

1,599


The notes on pages 16 to 39 form part of these financial statements.

Page 15

 
SOUTHERN HOMEMOVE LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

1.


General information

Southern Homemove Ltd is a private company limited by shares and incorporated in England and Wales, registration number 14748818. The registered office is 44 Coombe Lane, London, SW20 0LA.

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 Group management to exercise judgement in applying the Group's accounting policies (see note 3).

The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its own Statement of comprehensive income in these financial statements.

The financial statements are presented in Sterling which is the functional currency of the Group and Company and are rounded to the nearest thousand pounds sterling.
The Company was incorporated on 22 March 2023 and is preparing its first period of account for the 9 months to 31 December 2023 to bring the year-end in line with the rest of the Group. The Company acquired its subsidiary entities on 5 May 2023 (Note 21) and the consolidated financial statements are prepared from this date.

The following principal accounting policies have been applied:

 
2.2

Basis of consolidation

The consolidated financial statements present the results of the Company and its own subsidiaries ("the Group") as if they form a single entity. Intercompany transactions and balances between group companies are therefore eliminated in full.
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the Statement of Financial Position, the acquiree's identifiable assets, liabilities and contingent liabilities are initially recognised at their fair values at the acquisition date. The results of acquired operations are included in the Consolidated statement of comprehensive income from the date on which control is obtained. They are deconsolidated from the date control ceases.

Page 16

 
SOUTHERN HOMEMOVE LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.3

Going concern

The directors have considered the Group’s position at the time of signing the financial statements and have undertaken an exercise to forecast future profits and cash flows for the Group. The directors have also considered the current financial position of the Group, measures the directors could take to mitigate ongoing costs should they need to and the cash and financing facilities available to the Group.
Based on this, the directors have concluded that they have a reasonable expectation that the Group will have adequate resources to continue in operational existence for the foreseeable future, and at least twelve months from the date of signing these financial statements, they therefore continue to adopt the going concern basis of accounting in preparing these financial statements.

 
2.4

Turnover

Turnover is recognised to the extent that it is probable that the economic benefits will flow to the Group and the turnover can be reliably measured. Turnover is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before turnover is recognised:

Turnover from exchange fees on residential sales is recognised at the legal exchange date of the sale.
Turnover from lettings is recognised on completion of the service being provided, the performance obligations which the Group has depends on the type of lettings income. Let-only lettings income is recgnised at a point in time at the start of the minimum period for which a tenant has been found, typically per month. Rent-collect lettings income is recognised at a point in time once the rent has been collected for that period, typically per month. Fully managed lettings is split between the proportion of income from rent collection services which is recognised at that point in time with the remaning income being recognised over the rental period. Pre and post tenancy income is recognised at a point in time once the service is provided.
Turnover from conveyancing referrals, financial services for referrals and completion of mortgage procurement is recognised at the legal exchange date of the residential sale to which the transaction relates.

 
2.5

Operating leases: the Group as lessee

Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.

Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.

 
2.6

Finance costs

Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.

Page 17

 
SOUTHERN HOMEMOVE LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.7

Pensions

Defined contribution pension plan

The Group operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. Once the contributions have been paid the Group 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 Group in independently administered funds.

 
2.8

Current and deferred taxation

The tax expense for the period 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 and the Group operate and generate 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;
Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met; and
Where they relate to timing differences in respect of interests in subsidiaries, associates, branches and joint ventures and the Group can control the reversal of the timing differences and such reversal is not considered probable in the foreseeable future.

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 18

 
SOUTHERN HOMEMOVE LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.9

Intangible assets

Goodwill

Goodwill represents the difference between amounts paid on the cost of a business combination and the acquirer’s interest in the fair value of the Group's share of its identifiable assets and liabilities of the acquiree at the date of acquisition. Subsequent to initial recognition, goodwill is measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is amortised on a straight-line basis to the Consolidated statement of comprehensive income over its useful economic life.

Other intangible assets

Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.

All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.

 The estimated useful lives range as follows:

Fixed lettings book fee
-
15
years
Lettings book
-
5
years
Goodwill in individual companies
-
10
years
Negative goodwill on acquisition
-
15
years

During the period the Group entered into franchise agreements which included an initial fee for the benefit of existing lettings books and registered trademarks, payable in the form of a monthly fixed fee over 15 years. The directors consider the monthly fixed fee represents the purchase of these assets. As such, the assets are capitalised at the present value of the future payments discounted at an appropriate weighted average cost of capital and a corresponding fixed lettings book fee liability recognised.
Subsequently, the fixed lettings book fee asset is amortised to the Consolidated statement of comprehensive income over 15 years, being the full term of the franchise agreement. The discounting of the liability is unwound annually with the finance cost recognised within the Consolidated statement of comprehensive income.

 
2.10

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.

Page 19

 
SOUTHERN HOMEMOVE LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

2.Accounting policies (continued)


2.10
Tangible fixed assets (continued)

Depreciation 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:

Long-term leasehold property
-
over the length of the lease
Motor vehicles
-
4 years or length of finance lease
Fixtures and fittings
-
3 - 5 years
Office equipment
-
3 - 5 years
Computer equipment
-
3 years

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.

 
2.11

Valuation of investments

Investments in subsidiaries are measured at cost less accumulated impairment.

 
2.12

Debtors

Short-term debtors are measured at transaction price, less any impairment.

 
2.13

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.

In the Consolidated statement of cash flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the Group's cash management.

Page 20

 
SOUTHERN HOMEMOVE LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

2.Accounting policies (continued)

 
2.14

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.

 
2.15

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.

 
2.16

Financial instruments

The Group has elected to apply the provisions of Section 11 “Basic Financial Instruments” of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the Group's Statement of financial position when the Group 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 debtors, cash and bank balances, are initially measured at their transaction price (adjusted for transaction costs except in the initial measurement of financial assets that are subsequently measured at fair value through profit and loss) 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 Group's cash and cash equivalents, trade and most other debtors due with the operating cycle fall into this category of financial instruments.

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 Group after the deduction of all its liabilities.

Basic financial liabilities, which include trade and other creditors, bank loans, other loans and loans due to fellow group companies are initially measured at their transaction price (adjusting for transaction costs except in the initial measurement of financial liabilities that are subsequently measured at fair value through profit and loss). When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future payments discounted at a market rate of interest, discounting is omitted where the effect of discounting is immaterial.
Page 21

 
SOUTHERN HOMEMOVE LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

2.Accounting policies (continued)


2.16
Financial instruments (continued)


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

Trade creditors are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade creditors are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade creditors 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.


3.


Judgements in applying accounting policies and key sources of estimation uncertainty

The preparation of financial statements in compliance with FRS102 requires the use of certain critical accounting estimates and judgements. It also requires management to exercise judgement in the process of applying the Group's accounting policies. The estimates that have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities within the next financial year are discussed below:
Goodwill on business combination
An estimation is made in relation to the recoverability and useful economic life of goodwill. In determining goodwill the directors have concluded that there are no separable intangible assets. 
Amortisation of goodwill within subsidiary companies
The Group assesses the useful life of goodwill by determining the expected life of the relevant lettings books acquired. The Group also reviews annually for impairment of goodwill and this requires an estimation of the value-in-use of the cash generating units to which the intangible assets are allocated. This involves estimation of future cash flows and choosing a suitable discount rate.
 
Dilapidations provision
The Group reviews it property lease agreements for evidence of any dilapidation clauses. The Group considers work incurred while the property has been leased and estimates the expected cost of re-instating the property to the condition at the beginning of the lease.

Page 22

 
SOUTHERN HOMEMOVE LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

4.


Turnover

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


Period ended
31 December
2023
£000

Residential sales
4,752

Lettings income
4,107

Financial services
141

Other income
167

9,167


All turnover arose within the United Kingdom.


5.


Operating (loss)/profit

The operating (loss)/profit is stated after charging:

Period ended
31 December
2023
£000

Other operating lease rentals
463


6.


Auditors' remuneration

Period ended
31 December
2023
£000

Fees payable to the Company's auditors for the audit of the consolidated and parent Company's financial statements
18

Page 23

 
SOUTHERN HOMEMOVE LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

7.


Employees

Staff costs, including directors' remuneration, were as follows:


Group
2023
£000


Wages and salaries
4,498

Social security costs
491

Cost of defined contribution scheme
173

5,162


The average number of Group employees, including the directors, during the period was 191.
The Company has no employees other than the directors.


8.


Directors' remuneration

Period ended
31 December
2023
£000

Directors' emoluments
81

Group contributions to defined contribution pension schemes
3

Amounts paid to third parties in respect of directors' services
60

144


During the period retirement benefits were accruing to 1 director in respect of defined contribution pension schemes.

The directors are considered to be the key management personnel of the Group.

Page 24

 
SOUTHERN HOMEMOVE LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

9.


Interest payable and similar expenses

Period ended
31 December
2023
£000


Finance leases and hire purchase contracts
3

Fixed lettings book fee finance cost
125

128


10.


Taxation


Period ended
31 December
2023
£000


Deferred tax


Tax losses
(208)

Total deferred tax
(208)


Tax on (loss)/profit
(208)
Page 25

 
SOUTHERN HOMEMOVE LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023
 
10.Taxation (continued)


Factors affecting tax charge for the period

The tax assessed for the period is lower than the standard rate of corporation tax in the UK of 25%. The differences are explained below:

Period ended
31 December
2023
£000


(Loss)/profit on ordinary activities before tax
(170)


(Loss)/profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25%
(43)


Expenses not deductible for tax purposes, other than goodwill amortisation and impairment
13

Remeasurement of deferred tax for changes in tax rates
27

Recognition of deferred tax asset on losses
(242)

Other differences leading to an increase in the tax charge
37

Total tax charge for the period
(208)


Factors that may affect future tax charges

There are no factors that may affect future tax charges known at the reporting date.

Page 26

 
SOUTHERN HOMEMOVE LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

11.


Intangible assets

Group




Fixed lettings book fee
Lettings book
Goodwill in individual companies
Negative goodwill on acquisition 
Total

£000
£000
£000
£000
£000



Cost


Additions
1,901
-
-
(755)
1,146


On acquisition of subsidiaries
-
101
65
-
166



At 31 December 2023

1,901
101
65
(755)
1,312



Amortisation


Charge for the period
84
27
62
(34)
139



At 31 December 2023

84
27
62
(34)
139



Net book value



At 31 December 2023
1,817
74
3
(721)
1,173



Page 27

 
SOUTHERN HOMEMOVE LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

12.


Tangible fixed assets

Group






Leasehold improve-
ments
Motor vehicles
Fixtures and fittings
Office equipment
Computer equipment
Total

£000
£000
£000
£000
£000
£000



Cost 


Additions
-
-
5
-
2
7


Acquisition of subsidiary
251
43
988
71
15
1,368


Disposals
(113)
-
(113)
-
(15)
(241)



At 31 December 2023

138
43
880
71
2
1,134



Depreciation


Charge for the period
13
7
64
6
1
91


Disposals
(90)
-
(113)
-
(14)
(217)


Acquisition of subsidiary
137
36
799
57
13
1,042



At 31 December 2023

60
43
750
63
-
916



Net book value



At 31 December 2023
78
-
130
8
2
218

Page 28

 
SOUTHERN HOMEMOVE LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

           12.Tangible fixed assets (continued)


Company






Computer equipment

£000

Cost


Additions
2



At 31 December 2023

2






Net book value



At 31 December 2023
2







13.


Fixed asset investments


Subsidiary undertakings


The following were subsidiary undertakings of the Company:

Name

Registered office

Class of shares

Holding

EADTL Ltd
First floor Glendale House, Reading Road, Burghfield Common, Reading, Berkshire, RG7 3BL
Ordinary
100%
EAHAW Ltd
44 Coombe Lane, London, SW20 0LA
Ordinary
100%
EALAU Ltd
44 Coombe Lane, London, SW20 0LA
Ordinary
100%
EAGF Ltd
99-103 London Road, Morden, SM4 5HP
Ordinary
100%

The principal activity of all subsidiary undertakings was the provision of estate agency services and related activities.

Page 29

 
SOUTHERN HOMEMOVE LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

14.


Debtors

Group
Company
2023
2023
£000
£000

Due after more than one year

Other debtors
19
-

Due within one year

Trade debtors
746
-

Amounts owed by group undertakings
-
18

Other debtors
572
5

Prepayments and accrued income
85
42

Deferred taxation
325
-

1,747
65


Trade debtors are stated net of impairment losses totalling £143k. Impairment charges of £60k were recognised in profit and loss.


15.


Cash and cash equivalents

Group
Company
2023
2023
£000
£000

Cash at bank and in hand
1,599
221



16.


Creditors: Amounts falling due within one year

Group
Company
2023
2023
£000
£000

Trade creditors
649
49

Amounts owed to group undertakings
-
16

Corporation tax
510
-

Other taxation and social security
719
-

Fixed lettings book fee
243
-

Other creditors
213
180

Accruals and deferred income
651
30

2,985
275


Page 30

 
SOUTHERN HOMEMOVE LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

17.


Creditors: Amounts falling due after more than one year

Group
2023
£000

Fixed lettings book fee
1,618




18.


Deferred taxation


Group



2023


£000






Charged to profit or loss
(135)


Arising on business combinations
460



At end of year
325







Group
2023
£000

Tax losses
325

The Company had no deferred tax assets or liabilities at 31 December 2023.
The Group has deferred tax assets of £1,074k 
(2022 - £1,073k) on corporation tax losses has not been recognised on the basis that there is uncertainty over the recoverability of the asset.

Page 31

 
SOUTHERN HOMEMOVE LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

19.


Provisions


Group



Dilapidation provision

£000





Charged to profit or loss
96



At 31 December 2023
96


20.


Share capital

2023
£
Allotted, called up and fully paid


100 Ordinary shares of £1.00 each
100


The Company was incorporated with 100 Ordinary Shares of £1 each on 22 March 2023.
Following the year end, on 6 February 2024, a further 100 Ordinary Shares of £1 each were allotted.


21.


Reserves

Profit and loss account

The profit and loss account includes all retained profits and losses.

Page 32

 
SOUTHERN HOMEMOVE LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

22.
 

Business combinations

On 5 May 2023, the Company acquired the entire share capital of the following companies:

Acquisition of EAGF Ltd

Recognised amounts of identifiable assets acquired and liabilities assumed

Book value
Fair value
£000
£000

Fixed Assets

Tangible
181
181

Intangible
87
87

268
268

Current Assets

Debtors
318
318

Cash at bank and in hand
213
213

Total Assets
799
799

Creditors

Due within one year
(824)
(824)

Deferred taxation
47
47

Total Identifiable net assets
22
22


Goodwill
(259)

Total purchase consideration
(237)

Consideration

£000


Corporation tax liability paid by previous owner
(237)

Total purchase consideration
(237)

Cash inflow on acquisition

£000

Cash and cash equivalents acquired
(213)

Net cash inflow on acquisition
(213)

Page 33

 
SOUTHERN HOMEMOVE LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

22.Business combinations (continued)

The negative goodwill arising on acquisition is attributable to the fair value of assets and liabilities acquired being greater than the actual cash outflow. There are not considered to be any fair value adjustments to the book value of acquired assets and liabilities.

The results of EAGF Ltd since acquisition to 31 December 2023 are as follows:

Current period since acquisition
£000

Turnover
2,977

Profit for the period since acquisition
157

Acquisition of EAHAW Ltd

Recognised amounts of identifiable assets acquired and liabilities assumed

Book value
Fair value
£000
£000

Fixed Assets

Tangible
45
45

Intangible
50
50

95
95

Current Assets

Debtors
363
363

Cash at bank and in hand
246
246

Total Assets
704
704

Creditors

Due within one year
(621)
(621)

Deferred taxation
189
189

Total Identifiable net assets
272
272


Goodwill
(411)

Total purchase consideration
(139)

Page 34

 
SOUTHERN HOMEMOVE LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

22.Business combinations (continued)

Consideration

£000


Corporation tax liability paid by previous owner
(139)

Total purchase consideration
(139)

Cash inflow on acquisition

£000

Cash and cash equivalents acquired
(246)

Net cash inflow on acquisition
(246)

The negative goodwill arising on acquisition is attributable to the fair value of assets and liabilities acquired being greater than the actual cash outflow. There are not considered to be any fair value adjustments to the book value of acquired assets and liabilities.

The results of EAHAW Ltd since acquisition are as follows:

Current period since acquisition
£000

Turnover
2,441

Loss for the period since acquisition
(32)

Page 35

 
SOUTHERN HOMEMOVE LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

22.Business combinations (continued)

Acquisition of EALAU Ltd

Recognised amounts of identifiable assets acquired and liabilities assumed

Book value
Fair value
£000
£000

Fixed Assets

Tangible
30
30

30
30

Current Assets

Debtors
58
58

Cash at bank and in hand
82
82

Total Assets
170
170

Creditors

Due within one year
(225)
(225)

Deferred taxation
15
15

Total Identifiable net liabilities
(40)
(40)


Goodwill
40

Total purchase consideration
-



Cash inflow on acquisition

£000

Cash and cash equivalents acquired
(82)

Net cash inflow on acquisition
(82)

Page 36

 
SOUTHERN HOMEMOVE LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

22.Business combinations (continued)

The negative goodwill arising on acquisition is attributable to the fair value of assets and liabilities acquired being greater than the actual cash outflow. There are not considered to be any fair value adjustments to the book value of acquired assets and liabilities.

The results of EALAU Ltd since acquisition are as follows:

Current period since acquisition
£000

Turnover
419

Loss for the period since acquisition
(82)

Acquisition of EADTL Ltd

Recognised amounts of identifiable assets acquired and liabilities assumed

Book value
Fair value
£000
£000

Fixed Assets

Tangible
70
70

Intangible
15
15

85
85

Current Assets

Debtors
244
244

Cash at bank and in hand
152
152

Total Assets
481
481

Creditors

Due within one year
(516)
(516)

Deferred taxation
26
26

Total Identifiable net liabilities
(9)
(9)


Goodwill
(125)

Total purchase consideration
(134)

Page 37

 
SOUTHERN HOMEMOVE LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

22.Business combinations (continued)

Consideration

£000


Corporation tax liability paid by previous owner
(134)

Total purchase consideration
(134)

Cash inflow on acquisition

£000

Cash and cash equivalents acquired
(152)

Net cash inflow on acquisition
(152)

The negative goodwill arising on acquisition is attributable to the fair value of assets and liabilities acquired being greater than the actual cash outflow. There are not considered to be any fair value adjustments to the book value of acquired assets and liabilities.

The results of EADTL Ltd since acquisition are as follows:

Current period since acquisition
£000

Turnover
3,330

Loss for the period since acquisition
(31)


23.


Pension commitments

The Group operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the Group in an independently administered fund. The pension cost charge represents contributions payable by the Group to the fund and amounted to £173k. Contributions totalling £23k were payable to the fund at the reporting date and are included in creditors.


24.


Client monies

As at 31 December 2023, monies held in separate bank accounts on behalf of clients amounted to £9,289k. Neither this amount, nor the matching liabilities to the clients concerned are included in the Statement of financial position.
Client funds are protected by the Financial Services Compensation Scheme (FSCS) under which the Government guarantees amounts up to £85,000. This guarantee applies to each individual client, not the total of deposits held by the Company.

Page 38

 
SOUTHERN HOMEMOVE LTD
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023

25.


Commitments under operating leases

At 31 December 2023 the Group and the Company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:


Group
Company
2023
2023
£000
£000

Not later than 1 year
329
284

Later than 1 year and not later than 5 years
484
-

813
284


26.


Related party transactions

Key management personnel is considered to be the directors of the Group, see Note 8 for details of directors remuneration.
The Company purchased services of £71k from companies under common joint control of a director of the Company. This includes £60k in respect of directors services as disclosed in Note 8. No balance was outstanding at year-end.
The Group has taken advantage of the exemption to disclose related party transactions entered into between two or more members of a group, provided that any subsidiary which is a party to the transaction is wholly owned by such a member.


27.


Controlling party

The controlling party of the Company is considered to be Lucie Heanley by virtue of her majority shareholding.

 
Page 39