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Registered number: 04674817










INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED










DIRECTORS' REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

 
INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED
 
 
COMPANY INFORMATION


Directors
D M M Vermeer (appointed 1 October 2024)
H Holman 
S Blackmore (resigned 1 October 2024)




Company secretary
M Duggan



Registered number
04674817



Registered office
Equitix Management Services
Unit G1 Ash Tree Court

Nottingham Business Park

Nottingham

NG8 6PY




Independent auditors
Ryecroft Glenton
Chartered Accountants & Statutory Auditors

32 Portland Terrace

Newcastle upon Tyne

NE2 1PQ





 
INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED
 

CONTENTS



Page
Directors' report
1 - 4
Independent auditors' report
5 - 8
Statement of comprehensive income
9
Balance sheet
10
Statement of changes in equity
11
Notes to the financial statements
12 - 23


 
INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED
 
 
 
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 DECEMBER 2024

The directors present their report and the financial statements for the year ended 31 December 2024.

Principal activity

The Company's principal activities during the year were the provision and maintenance of social and healthcare centres under a 28 year Private Finance Initiative (PFI) contract term with Kent County Council.
The Company has closely monitored the performance of the business during the year together with it's technical advisors and the contract has been carried out in line with expectations.
The Company, during the coming year, will continue with the provision and maintenance of social and healthcare centres in Tenterden and Margate for Kent County Council.

Results and dividends

The profit for the year, after taxation, amounted to £821k (2023 - £829k).

The company paid interim dividends of £821k (2023 - £215k) during the year. The directors do not recommend a final dividend to be paid (2023 - £nil).

Directors

The directors who served during the year were:

D M M Vermeer (appointed 1 October 2024)
H Holman 
S Blackmore (resigned 1 October 2024)

Principal risks and uncertainties

The Company is subject to certain risks during the operational phase of the contract. These risks wherever possible have been mitigated by passing the risk down to sub-contractors or by using interest rate and retail price swap instruments.

Liquidity risk
The Company builds up sufficient cash balances to ensure it is able to meet it's loan obligations and other liabilities.

Credit risk
The Company's principal financial assets are it's long-term debtors. The directors consider that credit risk is mitigated by the fact that Kent County Council is the Company's sole counterparty and debtor. The directors consider Kent County Council is a financially secure counterparty. Clauses in the concession agreement ensure that the Company will be sufficiently compensated by Kent County Council in the event of default or voluntary termination.

Interest rate cash flow risk
The Company has in place hedging arrangements to eliminate risk from interest rate movements and fluctuations in retail price indices. In order to ensure stability of cash flows and hence manage interest rate risk, the Company has a policy of maintaining all of it's bank debt at a fixed rate.
Page 1

 
INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024

Supplier risk
The main supplier to the SPV is in relation to the Facilities Management contract. The risks associated with this contract, such as the developments associated with the Ukraine war, are mitigated as it is on a fixed term at a fixed cost per annum, only increasing in line with inflation. Additionally the credit and performance risk of the Facilities Management contract supplier is monitored on a regular basis to ensure that the services are delivered on a continuing timely basis to the appropriate standard. Should service issues develop, the SPV would seek to resolve through contractual provisions and ultimately the SPV has the right to terminate the contract by serving notice and consequently putting in place an alternative contract supplier.

Directors' responsibilities statement

The directors are responsible for preparing the Directors' report and the financial statements in accordance with applicable law and regulations.
 
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period.

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


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

make judgements and accounting estimates that are reasonable and prudent;

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

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and to enable them to ensure that the financial statements comply with the Companies Act 2006They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Qualifying third party indemnity provisions

The Company did not provide any indemnity insurance for the directors during the year (2023: £nil).

Page 2

 
INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024

Going concern

The Company has net liabilities of £436k (2023: £939k) which includes the fair value of the interest rate swap of £401k (2023: £810k), the fair value of the RPI swap of £2,063k (2023: £2,324k), and cash of £1,464k (2023: £3,353k).
The directors have reviewed the future liquidity requirements and have considered the cash flow forecasts of the company as set out in the operational model, which show that the project will continue to operate profitably and be cash generative, operating well within its means. Based on this review, and the future business prospects of the company, despite the current economic conditions (which include the impact of the Ukraine war) the directors believe the company will be able to meet its liabilities as they fall due and as such do not expect to be significantly affected by these events. Further consideration has been included in the risks section of the Directors’ Report.
The directors are also mindful of the relationship with the local authority and ensure that this is carefully monitored and maintained. There have been no instances during the year, or since, of non-compliance of the Project Agreement, and a good working relationship with the local authority remains. Furthermore, the directors closely monitor the performance of the Facilities Management contractor, ensuring they are able to continue to perform.  
Having regards to the above and after enquiries, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the annual report and accounts.

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 auditorsRyecroft Glentonwill be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

Page 3

 
INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED
 
 
 
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 DECEMBER 2024


Small companies note

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

This report was approved by the board on 28 April 2025 and signed on its behalf.
 





H Holman
Director

Page 4

 
INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED
 

Opinion


We have audited the financial statements of Integrated Care Solutions (East Kent) Limited (the 'Company') for the year ended 31 December 2024, which comprise the Statement of comprehensive income, the Balance sheet, 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 2024 and of its profit for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
have been prepared in accordance with the requirements of the Companies Act 2006.


Basis for opinion


We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the 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 5

 
INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF INTEGRATED CARE SOLUTIONS (EAST KENT) 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' exemptions in preparing the Directors' report and from the requirement to prepare a Strategic report.


Page 6

 
INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED (CONTINUED)


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, 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.


The extent to which the audit was considered capable of detecting of fraud
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:

Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:
•  the Responsible Individual ensured that the engagement team collectively had the appropriate    competence, capabilities and skills to identify or recognise non-compliance with applicable laws and    regulations;
•  we identified the laws and regulations applicable to the company through discussions with directors and    other management, and from our commercial knowledge and experience of the sector;
•  we focused on specific laws and regulations which we considered may have a direct material effect on the  financial statements or the operations of the company, including Companies Act 2006, taxation legislation,  data protection, anti-bribery and employment legislation;
•  we assessed the extent of compliance with the laws and regulations identified above through making    enquiries of management and inspecting legal correspondence made available to us; and
•  identified laws and regulations were communicated within the audit team regularly and the team remained   alert to instances of non-compliance throughout the audit.
We assessed the susceptibility of the company’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:
•  making enquiries of management as to where they considered there was susceptibility to fraud, their    knowledge of actual, suspected and alleged fraud; and
•  considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and    regulations.
Page 7

 
INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED
 
 
 
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED (CONTINUED)


To address the risk of fraud through management bias and override of controls, we:
•  performed analytical procedures to identify any unusual or unexpected relationships;
•  tested journal entries to identify unusual transactions; and
•  assessed whether judgements and assumptions made in determining accounting estimates were     indicative of potential bias, as set out in Note 3.
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:
•  agreeing financial statement disclosures to underlying supporting documentation;
•  reading the minutes of meetings of those charged with governance;
•  enquiring of management as to actual and potential litigation and claims; and
•  reviewing correspondence with HMRC, relevant regulators and the company’s legal advisors where
          available, along with discussing laws and regulations with those who are responsible for compliance.
There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.
Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.


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.


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.





Andrew Cameron (Senior statutory auditor)
  
for and on behalf of
Ryecroft Glenton
 
Chartered Accountants
Statutory Auditors
  
32 Portland Terrace
Newcastle upon Tyne
NE2 1PQ

28 April 2025
Page 8

 
INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED
 
 
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2024

2024
2023
Note
£000
£000

  

Turnover
 4 
5,343
4,877

Cost of sales
  
(3,677)
(3,229)

Gross profit
  
1,666
1,648

Administrative expenses
  
(277)
(288)

Operating profit
  
1,389
1,360

Interest receivable and similar income
 7 
922
959

Interest payable and similar expenses
 8 
(1,262)
(1,305)

Profit before tax
  
1,049
1,014

Tax on profit
 9 
(228)
(185)

Profit for the financial year
  
821
829

Other comprehensive income for the year
  

Movement in cash flow hedge
  
671
96

Taxation in respect of items of other comprehensive income
  
(168)
(24)

Other comprehensive income for the year
  
503
72

Total comprehensive income for the year
  
1,324
901

The notes on pages 12 to 23 form part of these financial statements.

Page 9

 
INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED
REGISTERED NUMBER: 04674817

BALANCE SHEET
AS AT 31 DECEMBER 2024

2024
2023
Note
£000
£000

  

Current assets
  

Debtors
 11 
16,052
16,705

Current asset investments
 12 
1,587
-

Cash at bank and in hand
 13 
1,464
3,353

  
19,103
20,058

Creditors: amounts falling due within one year
 14 
(5,263)
(4,872)

Net current assets
  
 
 
13,840
 
 
15,186

Total assets less current liabilities
  
13,840
15,186

Creditors: amounts falling due after more than one year
 15 
(14,276)
(16,125)

  

Net liabilities
  
(436)
(939)


Capital and reserves
  

Called up share capital 
 19 
130
130

Other reserves
 20 
(1,847)
(2,350)

Profit and loss account
 20 
1,281
1,281

  
(436)
(939)


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

The financial statements were approved and authorised for issue by the board and were signed on its behalf on 28 April 2025.




H Holman
Director

The notes on pages 12 to 23 form part of these financial statements.

Page 10

 
INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED
 

STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024


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

£000
£000
£000
£000


At 1 January 2023
130
(2,422)
667
(1,625)



Profit for the year
-
-
829
829

Hedge effective portion of change in fair value of designated hedging
-
96
-
96

Taxation in respect of items of other comprehensive income
-
(24)
-
(24)

Dividends: Equity capital
-
-
(215)
(215)



At 1 January 2024
130
(2,350)
1,281
(939)



Profit for the year
-
-
821
821

Hedge effective portion of change in fair value of designated hedging
-
671
-
671

Taxation in respect of items of other comprehensive income
-
(168)
-
(168)

Dividends: Equity capital
-
-
(821)
(821)


At 31 December 2024
130
(1,847)
1,281
(436)


The notes on pages 12 to 23 form part of these financial statements.

Page 11

 
INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

1.


General information

Integrated Care Solutions (East Kent) Limited is a private company limited by shares incorporated in England and Wales. The registered office is Equitix Management Services Unit G1 Ash Tree Court, Nottingham Business Park, Nottingham, England, NG8 6PY.
The Company's registered number is 04674817. The principal activities of the Company are set out in the Director's 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 Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the Company. Monetary amounts in these financial statements are rounded to the nearest £'000.  

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

The following principal accounting policies have been applied:

 
2.2

Going concern

The Company has net liabilities of £436k (2023: £939k) which includes the fair value of the interest rate swap of £401k (2023: £810k), the fair value of the RPI swap of £2,063k (2023: £2,324k), and cash of £1,464k (2023: £3,353k).
The directors have reviewed the future liquidity requirements and have considered the cash flow forecasts of the company as set out in the operational model, which show that the project will continue to operate profitably and be cash generative, operating well within its means. Based on this review, and the future business prospects of the company, despite the current economic conditions (which include the impact of the Ukraine war) the directors believe the company will be able to meet its liabilities as they fall due and as such do not expect to be significantly affected by these events. Further consideration has been included in the risks section of the Directors’ Report.
The directors are also mindful of the relationship with the local authority and ensure that this is carefully monitored and maintained. There have been no instances during the year, or since, of non-compliance of the Project Agreement, and a good working relationship with the local authority remains. Furthermore, the directors closely monitor the performance of the Facilities Management contractor, ensuring they are able to continue to perform.  
Having regards to the above and after enquiries, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the annual report and accounts.

Page 12

 
INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

2.Accounting policies (continued)

 
2.3

Turnover

The Company is an operator of a PFI contract, the underlying asset is not deemed to be an asset of the Company under FRS 102, because the risks and rewards of ownership as set out in that standards are deemed to lie principally with the authority.
During the construction phase of the project, all attributable expenditure was included in amounts recoverable on contracts and turnover. Upon becoming operational, the costs were transferred to the finance debtor. During the operational phase, income is allocated between interest receivable and the finance debtor using a project specific interest rate. The remainder of the PFI unitary charge income is included within turnover in accordance with FRS 102. The Company recognised income in respect of the services provided as it fulfils it's contractual obligations in respect of those services and in line with the fair value of the consideration receivable in respect of those services.
Major maintenance costs are recognised on a contractual basis and the revenue in respect of these services is recognised when these services are performed.

 
2.4

Interest income

Interest income is recognised in profit or loss using the effective interest method.

 
2.5

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.

 
2.6

Borrowing costs

All borrowing costs are recognised in profit or loss in the year in which they are incurred.

Page 13

 
INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

2.Accounting policies (continued)

 
2.7

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 balance sheet 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 balance sheet 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 balance sheet date.


 
2.8

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.

 
2.9

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.
The company is obligated to keep a separate cash reserve in respect of future major maintenance costs, change in law, debt service reserving and change in FM provider. This restricted cash balance, which is shown on the balance sheet within the "cash at bank and in hand" balance amounts to £329k at the year end (2023: £1,811k).

 
2.10

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.

Page 14

 
INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

2.Accounting policies (continued)

 
2.11

Hedge accounting

The Company has entered into variable to fixed rate interest swaps and RPI swap to manage its exposure to interest rate cash flow risk on its variable rate debt and inflation rate risk respectively. These derivatives are measured at fair value at each reporting date. To the extent the hedge is effective; movements in fair value are recognised in other comprehensive income and presented in a separate cash flow hedge reserve. Any ineffective portions of those movements are recognised in the profit or loss for the period. 

 
2.12

Dividends

Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting.


3.


Judgements in applying accounting policies and key sources of estimation uncertainty

The estimates and judgements that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the financial year are as follows:
a. Key sources of estimation uncertainty 
Financial asset interest rate - The financial asset interest income is based on the WACC of the project and is applied to the carrying value of the financial asset on a quarterly basis. The interest rate used throughout the project life is 7.50%. 
Service margin - After the property is constructed, the Company provides property management services. The remuneration for these services is recognised at cost plus an estimated mark up for profit on property management services.   
Fair value of derivative instruments - The Directors use their judgement in selecting a suitable valuation technique for derivative financial instruments. All derivative financial instruments are valued at the market to market valuation provided by the derivative counterparty. In these cases, the Company uses valuation techniques to assess the reasonableness of the valuation provided by the derivative counterparty. These techniques use a discounted cash flow analysis based on market observable inputs derived from similar instruments in similar and active markets. The fair value of derivative financial instruments at the balance sheet date was a liability of £2,463k (2023: £3,134k). The Directors do not consider the impact of own credit risk to be material.
b. Critical judgements 
Concession arrangements - The concession arrangements undertaken by the company are considered to fall within the scope of section 34 of FRS 102 "Service Concession Arrangements", as described in the turnover accounting policy note. This judgement has been based on a consideration of the nature and terms of the agreements. 


4.


Turnover

All turnover arose within the United Kingdom.

Page 15

 
INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

5.


Employees

The Company has no employees other than the directors, who did not receive any remuneration (2023 - £NIL)

6.


Directors' remuneration

The directors, who are key management personnel, did not receive any remuneration directly from the Company for their services during the current or prior year. Their services are subcontracted from related party entities as follows:


2024
2023
£000
£000

Fees for directors' services
105
93

105
93



7.


Interest receivable

2024
2023
£000
£000


Financial asset interest received
922
959

922
959


8.


Interest payable and similar expenses

2024
2023
£000
£000


Bank interest payable
1,006
1,039

Interest payable and similar charges
223
222

Bank fees payable
33
44

1,262
1,305

Page 16

 
INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

9.


Taxation


2024
2023
£000
£000

Corporation tax


Current tax on profits for the year
228
185


228
185


Total current tax
228
185

Factors affecting tax charge for the year

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

2024
2023
£000
£000


Profit on ordinary activities before tax
1,049
1,014


Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2023 - 25%)
262
254

Effects of:


Utilisation of tax losses
(34)
-

Adjustments to tax charge in respect of prior periods
-
(8)

Change in UK tax rate
-
(61)

Total tax charge for the year
228
185


10.


Dividends

2024
2023
£000
£000


Dividends paid
821
215

821
215

Page 17

 
INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

11.


Debtors


2024
2023
£000
£000

Due after more than one year

Finance asset
13,995
14,398

Deferred tax asset (Note 18)
616
783

14,611
15,181

Due within one year

Trade debtors
5
5

Prepayments and accrued income
560
667

Finance asset
876
852

16,052
16,705



12.


Current asset investments

2024
2023
£000
£000

Unlisted investments
1,587
-

1,587
-


At the end of the reporting period there was a balance of £1,587,000 (2023: £nil) placed on short term deposits. The short term deposits have an average maturity of 4 months. 


13.


Cash and cash equivalents

2024
2023
£000
£000

Cash at bank and in hand
1,464
3,353

1,464
3,353


Page 18

 
INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

14.


Creditors: Amounts falling due within one year

2024
2023
£000
£000

Bank loans (Note 16)
1,178
922

Trade creditors
76
268

Corporation tax
73
84

Other taxation and social security
160
132

Accruals and deferred income
3,776
3,466

5,263
4,872



15.


Creditors: Amounts falling due after more than one year

2024
2023
£000
£000

Bank loans (Note 16)
9,837
11,015

Other loans (Note 16)
1,976
1,976

Financial instruments (Note 17)
2,463
3,134

14,276
16,125


Page 19

 
INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

16.


Loans


Analysis of the maturity of loans is given below:


2024
2023
£000
£000

Amounts falling due within one year

Bank loans
1,178
922


1,178
922

Amounts falling due 1-2 years

Bank loans
1,265
1,178


1,265
1,178

Amounts falling due 2-5 years

Bank loans
4,850
4,315


4,850
4,315

Amounts falling due after more than 5 years

Bank loans
3,722
5,522

Other loans
1,976
1,976

5,698
7,498

12,991
13,913


Bank borrowings relate to a Senior Debt Facility from NIB Capital Bank NV.
The tenure of the term loan from NIBC Bank NV was originally 28 years and is repayable in 52 semi-annual instalments commencing 31 March 2006. 
Interest charged on amounts drawn is charged at a variable rate based on SONIA. The company has entered into an interest rate swap agreement whereby it pays a fixed rate of 5.37% and a floating SONIA rate. The swap expires on 30 September 2031. 
All amounts drawn under the facilities are secured by a fixed charge over all leasehold interests, book debts, project accounts and intellectual property of the Company and by a floating charge over the Company's undertakings and assets.
The Company entered into a subordinated loan note agreement with Integrated Care Solutions (East Kent) Holdings Limited on the same date. Interest is payable on the loan notes at a rate of 11.25% per annum. The full balance is repayable at the end of the project on 31 March 2033.

Page 20

 
INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

17.


Financial instruments

2024
2023
£000
£000

Financial assets


Financial assets measured at fair value through profit or loss
18,487
19,275


Financial liabilities


Derivative financial instruments designated as hedges of variable interest rate risk
2,463
3,134

Financial liabilities measured at amortised cost
14,867
15,671

17,330
18,805


Financial assets measured at amortised cost comprise finance assets, cash at bank, current asset investments, trade debtors, other debtors and prepayments.
Financial liabilities measured at amortised cost comprise bank loans, trade creditors and accruals.


Derivative financial instruments designated as hedges of variable interest rate risk comprise interest rate swaps and RPI swaps.
The fair values of the interest rate swaps have been determined by reference to prices available from the markets on which the instruments involved are traded.


Financial derivatives
The company has entered into interest rate swap contracts to hedge its exposure to fluctuations in interest rates and an RPI swap to hedge its exposure to fluctuations in the Retail Price Index. The effect of the interest rate swap is that the company pays a fixed rate of interest on its bank loans. Receipts and payments on interest rate instruments are recognised on an accruals basis, over the life of the instrument.

The notional principal amount of the interest rate swap as at 31 December 2024 is £11,066k (2023: £11,993k). The interest rate swap matures on 30 September 2031. The fair value of the interest rate swap as at 31 December 2024 gives rise to a liability of £401k (2023: £810k). 

The RPI swap commenced on 1 October 2005 when construction reached completion and the operational phase began. The RPI swap matures on 1 October 2031. The notional principal amount of the RPI swap as at 31 December 2024 is £258k (2023: £258k). The fair value or Mark to Market (MTM) of the RPI swap as at 31 December 2024 gives rise to a liability of £2,063k (2023: £2,324k).

Page 21

 
INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

18.


Deferred taxation




2024


£000






At beginning of year
616



At end of year
616

The deferred tax asset is made up as follows:

2024
2023
£000
£000


Cash flow hedge
616
783

616
783


19.


Share capital

2024
2023
£000
£000
Allotted, called up and fully paid



130,000 (2023 - 130,000) Ordinary shares of £1.00 each
130
130



20.


Reserves

Other reserves

Other reserves represents the hedging reserve which comprises the effective portion of the cumulative net change in the fair value of the cash flow hedging instruments related to hedged transactions that have not yet occurred, net of any deferred tax provided on this.

Profit and loss account

The profit and loss account comprises the cumulative distributable profits of the Company less any dividends paid to the parent company.

Page 22

 
INTEGRATED CARE SOLUTIONS (EAST KENT) LIMITED
 
 
 
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

21.


Related party transactions

As a wholly owned subsidiary of Integrated Care Solutions (East Kent) Holdings Limited, the Company has taken the exemption to disclose related party transactions with 100% group companies.
During the year the company paid £84k (2023 - £79k) to Equitix Management Services Limited for asset management services provided during the year. At the reporting date £8k (2023 - £7k) of the management services fees remained outstanding within trade creditors.
Payments for directors' services are disclosed at Note 6.


22.


Controlling party

The Company is a wholly owned subsidiary of Integrated Care Solutions (East Kent) Holdings Limited, a company incorporated in England and Wales.
Kent Vanwall Limited is the parent company of Integrated Care Solutions (East Kent) Holdings Limited.
The director considers Equitix Fund 1 LP to be the ultimate controlling entity.

Page 23