ACCOUNTS - Final Accounts preparation

Auditors' remuneration

During the year, the Company obtained the following services from the Company's auditors:

Registered number: SC565984

TWELVE NESS WALK LIMITED

DIRECTORS' REPORT AND FINANCIAL STATEMENT

FOR THE PERIOD ENDED 31 DECEMBER 2024


TWELVE NESS WALK LIMITED

COMPANY INFORMATION

Directors	A Dufresne-Macgregor
	D Tamman
	C J Ewan


Company secretary	LC Secretaries Limited


Registered number	SC565984


Registered office	Johnstone House
	52-54 Rose Street
	Aberdeen
	AB10 1HA


Independent auditors	AAB Audit & Accountancy Limited
	Kingshill View
	Prime Four Business Park
	Kingswells
	Aberdeen
	AB15 8PU


TWELVE NESS WALK LIMITED

CONTENTS

	Page
Strategic report	1
Directors' report	2
Directors' responsibilities statement	3
Independent auditors' report	4 - 7
Statement of comprehensive income	8
Balance sheet	9
Statement of changes in equity	10
Notes to the financial statements	11 - 26


TWELVE NESS WALK LIMITED

STRATEGIC REPORT

FOR THE YEAR ENDED 31 DECEMBER 2024

Introduction

The principal activity of the company during the year was that of operating a hotel.

Business review

The Directors are pleased to report that the business significantly outperforms the entire Inverness hotel market.

Principal risks and uncertainties

The directors considers there to be an appropriate structure in place to plan for and mitigate risks.
Competitive risk: The company operates in a competitive market and to some extent the level of trading is affected by the local economy and tourism. The risks associated with this are mitigated by ensuring the company offers a high quality of service across all areas of the business and by targeting the tourism sector as well as business customers.
Credit risk: The key credit risk is in relation to debtors. The directors consider there to be sufficient controls in place to mitigate this risk, with a regular review of outstanding balances.
The company's financial instruments comprise cash at bank, borrowings, trade debtors and trade creditors that arise directly from its operations. The main purpose of these financial instruments is to raise finance for the company’s operations and the main risk arising from them is interest rate fluctuations.
Liquidity risk: The company continues to enjoy a good relationship with the bank. The company aims to maintain an adequate working capital position, and forecasts to ensure that there are adequate facilities in place to meet liabilities as they fall due.

Financial key performance indicators

The key performance indicators used by the company are room occupancy rates and yields.

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

A Dufresne-Macgregor

Director

Date: 25 September 2025

Page 1


TWELVE NESS WALK 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.

Results and dividends

The profit for the year, after taxation, amounted to £678,218 (2023 - £353,827).

Directors

The directors who served during the year were:

A Dufresne-Macgregor

D Tamman

C J Ewan

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.

Post balance sheet events

There have been no significant events affecting the Company since the year end.

Auditors

The auditors, AAB Audit & Accountancy Limited, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.

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

A Dufresne-Macgregor

Director

Date: 25 September 2025

Page 2


TWELVE NESS WALK LIMITED

DIRECTORS' RESPONSIBILITIES STATEMENT

FOR THE YEAR ENDED 31 DECEMBER 2024

The directors are responsible for preparing the Strategic report, the Directors' report and the financial statements in accordance with applicable law and regulations.

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

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

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

∙make judgments and accounting estimates that are reasonable and prudent;

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

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

Page 3


TWELVE NESS WALK LIMITED

INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF TWELVE NESS WALK LIMITED

Opinion

We have audited the financial statements of Twelve Ness Walk 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 policies. The 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.

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 Report. Our 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.

Page 4


TWELVE NESS WALK LIMITED

INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF TWELVE NESS WALK LIMITED (CONTINUED)

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 Strategic report and the Directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

∙the 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 Company and its environment obtained in the course of the audit, we have not identified material misstatements in the 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, 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.

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 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.

Page 5


TWELVE NESS WALK LIMITED

INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF TWELVE NESS WALK LIMITED (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 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:

We obtained an understanding of the legal and regulatory frameworks within which the company operates, focusing on those laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements.
The laws and regulations we considered in this context were the Companies Act 2006 and Taxation legislation.
We identified the greatest risk of material impact on the financial statements from irregularities including fraud to be:

∙Management override of controls to manipulate the company's key performance indicators to meet targets

∙Timing and completeness of revenue recognition

∙Management judgement applied in calculating provisions

∙Compliance with relevant laws and regulations which directly impact the financial statements and those that the company needs to comply with for the purpose of trading

Our audit procedures to respond to these risks included:

∙Testing of journal entries and other adjustments for appropriateness

∙Reviewing a sample of sales transaction to confirm recognition appropriate

∙Evaluating the business rationale of significant transactions outside the normal course of business

∙Reviewing judgments made by management in their calculation of accounting estimates for potential management bias

∙Enquiries of management about litigation and claims and inspection of relevant correspondence

∙Reviewing legal and professional fees to identify indications of actual or potential litigation, claims and any non-compliance with laws and regulations

∙Reviewing minutes of meetings of those charged with governance to identify any matters indicating actual or potential fraud

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 6


TWELVE NESS WALK LIMITED

INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF TWELVE NESS WALK LIMITED (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 2006. Our 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.

Derek Mair (Senior statutory auditor)

for and on behalf of

AAB Audit & Accountancy Limited

Statutory Auditor

Kingshill View

Prime Four Business Park

Kingswells

Aberdeen

AB15 8PU

26 September 2025

Page 7


TWELVE NESS WALK LIMITED

STATEMENT OF COMPREHENSIVE INCOME

FOR THE YEAR ENDED 31 DECEMBER 2024

	2024	2023
Note	£	£


Turnover	4	5,270,564	4,818,911
Cost of sales		(2,679,148)	(2,649,899)
Gross profit		2,591,416	2,169,012
Administrative expenses		(1,564,856)	(1,554,966)
Other operating income	5	43,009	43,008
Operating profit		1,069,569	657,054
Interest receivable and similar income	8	105,160	80,976
Interest payable and similar expenses	9	(461,659)	(421,882)
Profit before tax		713,070	316,148
Tax on profit	10	(34,852)	37,679
Profit for the financial year		678,218	353,827

The notes on pages 11 to 26 form part of these financial statements.

Page 8


TWELVE NESS WALK LIMITED REGISTERED NUMBER:SC565984

BALANCE SHEET

AS AT 31 DECEMBER 2024

		2024		2023
Note		£		£

Fixed assets
Tangible assets	11		14,111,834		14,422,474
			14,111,834		14,422,474
Current assets
Stocks	12	46,395		42,183
Debtors: amounts falling due within one year	13	3,144,078		3,049,582
Cash at bank and in hand	14	1,787,215		1,278,016
		4,977,688		4,369,781
Creditors: amounts falling due within one year	15	(1,346,036)		(5,158,561)
Net current assets/(liabilities)			3,631,652		(788,780)
Total assets less current liabilities			17,743,486		13,633,694
Creditors: amounts falling due after more than one year	16		(7,920,397)		(4,456,547)
Provisions for liabilities
Deferred tax	19	(2,282,853)		(2,315,129)
			(2,282,853)		(2,315,129)
Net assets			7,540,236		6,862,018

Capital and reserves
Called up share capital	20	100	100
Revaluation reserve		6,687,400	6,800,703
Profit and loss account		852,736	61,215
		7,540,236	6,862,018

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

A Dufresne-Macgregor

Director

Date: 25 September 2025

The notes on pages 11 to 26 form part of these financial statements.

Page 9


TWELVE NESS WALK LIMITED

STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 31 DECEMBER 2024

	Called up share capital	Revaluation reserve	Profit and loss account	Total equity
	£	£	£	£
At 1 January 2023	100	6,914,006	(405,915)	6,508,191

Profit for the year	-	-	353,827	353,827
Transfer to/from profit and loss account	-	(113,303)	113,303	-

At 1 January 2024	100	6,800,703	61,215	6,862,018

Profit for the year	-	-	678,218	678,218
Transfer to/from profit and loss account	-	(113,303)	113,303	-
At 31 December 2024	100	6,687,400	852,736	7,540,236

The notes on pages 11 to 26 form part of these financial statements.

Page 10


TWELVE NESS WALK LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

1.	General information

Twelve Ness Walk Limited is a private limited company incorporated in Scotland. The registered office is Johnstone House, 52-54 Rose Street, Aberdeen, AB10 1HA.

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

The following principal accounting policies have been applied:

2.2

Going concern

The directors, having made due and careful enquiry, are of the opinion that the company has adequate working capital to execute its operations over the next 12 months. The directors, therefore, have made an informed judgement, at the time of approving the financial statements, that there is a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future.
The directors remain confident that the company can continue to operate as a going concern. The business has grown strongly with both high occupancy and increasing room rates. This, along with support from the wider Group, the new banking facilities agreed during the year together with the retained reserves will allow the company to continue to meet it’s obligations as they fall due and operate as a going concern.

As a result, the directors have continued to adopt the going concern basis of accounting in preparing the annual financial statements.

2.3

Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Revenue 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 revenue is recognised:

Rendering of services

Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:

∙the amount of revenue can be measured reliably;

∙it is probable that the Company will receive the consideration due under the contract;

∙the stage of completion of the contract at the end of the reporting period can be measured reliably; and

∙the costs incurred and the costs to complete the contract can be measured reliably.

Page 11


TWELVE NESS WALK LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

2.Accounting policies (continued)

2.4

Operating leases: the Company as lessee

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

2.5

Sale and leaseback

Where a sale and leaseback transaction results in a finance lease, no gain is immediately recognised for any excess of sales proceeds over the carrying amount of the asset. Instead, the proceeds are presented as a liability and subsequently measured at amortised cost using the effective interest method.
When a sale and leaseback transaction results in an operating lease, and it is clear that the transition is established at fair value any profit or loss is recognised immediately. If the sale price is below fair value, any profit or loss is recognised immediately unless the loss is compensated for by the future lease payments at below market price. In that case any such loss is amortised in proportion to the lease payments over the period for which the asset is expected to be used. If the sale price is above fair value, the excess over fair value is amortised over the period for which the asset is expected to be used.

2.6

Government grants

Grants are accounted under the accruals model as permitted by FRS 102. Grants relating to expenditure on tangible fixed assets are credited to profit or loss at the same rate as the depreciation on the assets to which the grant relates. The deferred element of grants is included in creditors as deferred income.
Grants of a revenue nature are recognised in the Statement of comprehensive income in the same period as the related expenditure.

2.7

Interest income

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

2.8

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.

2.9

Borrowing costs

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

2.10

Pensions

Defined contribution pension plan
The Company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the Company pays fixed contributions into a separate entity. Once the contributions have been paid the Company has no further payment obligations.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the Balance sheet. The assets of the plan are held separately from the Company in independently administered funds.

Page 12


TWELVE NESS WALK LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

2.Accounting policies (continued)

2.11

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.

2.12

Tangible fixed assets

Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, using the straight-line method.

Depreciation is provided on the following basis:

Leasehold property	-	75 years
Fixtures and fittings	-	10 years
Office equipment	-	4 years
Computer equipment	-	4 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.

Page 13


TWELVE NESS WALK LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

2.Accounting policies (continued)

2.13

Revaluation of tangible fixed assets

Individual freehold and leasehold properties are carried at current year value at fair value at the date of the revaluation less any subsequent accumulated depreciation and subsequent accumulated impairment losses. Revaluations are undertaken with sufficient regularity to ensure the carrying amount does not differ materially from that which would be determined using fair value at the balance sheet date.
Fair values are determined from market based evidence normally undertaken by professionally qualified valuers.

Revaluation gains and losses are recognised in other comprehensive income unless losses exceed the previously recognised gains or reflect a clear consumption of economic benefits, in which case the excess losses are recognised in profit or loss.

2.14

Stocks

Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis. Work in progress and finished goods include labour and attributable overheads.

At each balance sheet date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.

2.15

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.

2.16

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.

2.17

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.

2.18

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.

Page 14


TWELVE NESS WALK LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

2.Accounting policies (continued)

2.19

Financial instruments

The Company 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 Company's Balance sheet when the Company 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 receivables, cash and bank balances, are initially measured at their transaction price including transaction costs 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 Company's cash and cash equivalents, trade and most other receivables due with the operating cycle fall into this category of financial instruments.

Other financial assets

Other financial assets, which includes investments in equity instruments which are not classified as subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the recognised transaction price. Such assets are subsequently measured at fair value with the changes in fair value being recognised in the profit or loss. Where other financial assets are not publicly traded, hence their fair value cannot be measured reliably, they are measured at cost less impairment.

Impairment of financial assets

Financial assets are assessed for indicators of impairment at each reporting date.

Financial assets are impaired when events, subsequent to their initial recognition, indicate the estimated future cash flows derived from the financial asset(s) have been adversely impacted. The impairment loss will be the difference between the current carrying amount and the present value of the future cash flows at the asset(s) original effective interest rate.

If there is a favourable change in relation to the events surrounding the impairment loss then the impairment can be reviewed for possible reversal. The reversal will not cause the current carrying amount to exceed the original carrying amount had the impairment not been recognised. The impairment reversal is recognised in the profit or loss.

Financial liabilities

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instruments any contract that evidences a residual interest in the assets of the Company after the deduction of all its liabilities.

Page 15


TWELVE NESS WALK LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

2.Accounting policies (continued)

2.19

Financial instruments (continued)

Basic financial liabilities, which include trade and other payables, bank loans and other loans are initially measured at their transaction price after transaction costs. 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.

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

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

Other financial instruments

Derivatives, including forward exchange contracts, futures contracts and interest rate swaps, are not classified as basic financial instruments. These are initially recognised at fair value on the date the derivative contract is entered into, with costs being charged to the profit or loss. They are subsequently measured at fair value with changes in the profit or loss.

Debt instruments that do not meet the conditions as set out in FRS 102 paragraph 11.9 are subsequently measured at fair value through the profit or loss. This recognition and measurement would also apply to financial instruments where the performance is evaluated on a fair value basis as with a documented risk management or investment strategy.

Derecognition of financial instruments

Derecognition of financial assets

Financial assets are derecognised when their contractual right to future cash flow expire, or are settled, or when the Company transfers the asset and substantially all the risks and rewards of ownership to another party. If significant risks and rewards of ownership are retained after the transfer to another party, then the Company will continue to recognise the value of the portion of the risks and rewards retained.

Derecognition of financial liabilities

Financial liabilities are derecognised when the Company's contractual obligations expire or are discharged or cancelled.

Page 16


TWELVE NESS WALK LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

3.	Judgments in applying accounting policies and key sources of estimation uncertainty

Judgements in applying accounting policies and key sources of estimation uncertainty The preparation of financial statements, requires management to make judgements, estimates and assumptions that affect the amounts reported for assets and liabilities as at the Statement of Financial Position date and the amounts reported during the year for revenue and costs. However, the nature of estimation means that actual outcomes could differ from those estimates. Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The following judgements and estimates have had the most significant impact on amounts recognised in the financial statements:
Taxation
The company establishes provisions based on reasonable estimates, for possible consequences of audits by the tax authorities of the respective countries in which it operates. The amount of such provisions is based on various factors, such as experience with previous tax authorities and differing interpretations of tax regulations by the group and the tax authority.
Management estimation is required to determine the amount of deferred tax assets that can be recognised, based upon likely timing and level of future taxable profits together with an assessment of the effect of future tax planning strategies.
Carrying value of property
The directors consider, on an annual basis, whether changes in market conditions have led to any impairment in the valuation of property, using his judgement and market data available. In addition, judgement is applied to select an appropriate useful life and residual value to follow the basis of depreciation.

Turnover

The turnover and the profit for the year are attributable to the one principal activity of the company in the
United Kingdom.

5.	Other operating income
		2024	2023
		£	£

Government grants receivable	43,009	43,008
	43,009	43,008

Fees payable to the Company's auditors for the audit of the Company's financial statements

10,750

10,250

Page 17


TWELVE NESS WALK LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

Wages and salaries	1,483,528	1,421,465
Social security costs	114,911	105,392
Cost of defined contribution scheme	22,261	20,530
	1,620,700	1,547,387

The average monthly number of employees, including the directors, during the year was as follows:

	2024	2023
	No.	No.

Directors	3	3
Food and beverage	37	38
Housekeeping	16	20
Reception and sales	17	14
Admin and general	-	2

	73	77

8.	Interest receivable
		2024	2023
		£	£

Interest receivable from group companies	60,230	42,610
Other interest receivable	44,930	38,366
	105,160	80,976

9.	Interest payable and similar expenses
		2024	2023
		£	£

Bank interest payable	376,345	311,721
Finance leases and hire purchase contracts	63,834	56,747
Other interest payable	21,480	53,414
	461,659	421,882

Page 18


TWELVE NESS WALK LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

Corporation tax
Current tax on profits for the year	32,550	-
Adjustments in respect of previous periods	34,578	(679)
	67,128	(679)

Total current tax	67,128	(679)

Deferred tax
Origination and reversal of timing differences	(32,276)	(37,000)
Total deferred tax	(32,276)	(37,000)


	Taxation on profit/(loss) on ordinary activities	34,852	(37,679)

Profit on ordinary activities before tax

713,070

316,148

Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 25% (2023 - 25%)	178,268	79,037
Effects of:
Expenses not deductible for tax purposes, other than goodwill amortisation and impairment	1,538	684
Capital allowances for year in excess of depreciation	43,256	40,902
Short term timing difference leading to an increase (decrease) in taxation	(32,276)	(37,000)
Group relief	(157,735)	(120,623)
Adjustments in respect of prior periods	34,578	(679)
Losses brought forward	(32,777)	-
Total tax charge for the year	34,852	(37,679)

Page 19


TWELVE NESS WALK LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

11.	Tangible fixed assets

	Freehold property	Fixtures and fittings	Office equipment	Computer equipment	Total
	£	£	£	£	£
Cost or valuation
At 1 January 2024	14,033,678	1,004,960	154,800	76,374	15,269,812
Additions	-	4,445	4,163	-	8,608
At 31 December 2024	14,033,678	1,009,405	158,963	76,374	15,278,420
Depreciation
At 1 January 2024	187,086	453,904	143,247	63,101	847,338
Charge for the year on owned assets	187,087	116,317	4,712	11,132	319,248
At 31 December 2024	374,173	570,221	147,959	74,233	1,166,586
Net book value
At 31 December 2024	13,659,505	439,184	11,004	2,141	14,111,834
At 31 December 2023	13,846,592	551,056	11,553	13,273	14,422,474

In 2019, the company entered into an arrangement to sell and leaseback, on a 125 year lease, the property from which the hotel operates. As the company has the option to buy the property at the end of the lease for a nominal amount the transaction was recorded as a financing arrangement and no disposal of property or gain on disposal was recorded in the accounts.
A valuation of the hotel was carried out in December 2022 by external qualified chartered surveyors. This report valued the hotel on an open market value existing use basis at £18,000,000, with no allowance for the sale and leaseback arrangement entered in to during 2019. After taking into account the finance lease (Note 18) and depreciation, the Directors consider that a value of £14,033,678 is appropriate as at 31 December 2024.

Cost or valuation at 31 December 2024 is as follows:

			Land and buildings
			£

		At cost	5,535,962
		At valuation:
		2019	8,497,716

			14,033,678

Page 20


TWELVE NESS WALK LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

11.Tangible fixed assets (continued)

If the land and buildings had not been included at valuation they would have been included under the historical cost convention as follows:
	2024	2023
	£	£


Cost	5,535,962	5,535,962
Accumulated depreciation	(407,857)	(334,073)
Net book value	5,128,105	5,201,889

12.	Stocks
		2024	2023
		£	£

Raw materials and consumables	46,395	42,183
	46,395	42,183

13.

Debtors

					2024	2023
					£	£


Trade debtors	3,600	25,075
Amounts owed by group undertakings	3,103,380	2,985,400
Other debtors	-	1,838
Prepayments and accrued income	37,098	37,269
	3,144,078	3,049,582

14.	Cash and cash equivalents
		2024	2023
		£	£

Cash at bank and in hand	1,787,215	1,278,016
	1,787,215	1,278,016

Page 21


TWELVE NESS WALK LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

15.	Creditors: Amounts falling due within one year
		2024	2023
		£	£

Bank loans (Note 17)	261,009	3,709,402
Trade creditors	184,294	196,360
Amounts owed to group undertakings	214,806	386,725
Corporation tax	30,493	-
Other taxation and social security	161,479	147,182
Obligations under finance lease and hire purchase contracts	72,518	74,331
Other creditors	9,671	20,460
Accruals and deferred income	411,766	499,101
Share capital treated as debt	-	125,000
	1,346,036	5,158,561

The preference share treated as debt were fully reapid in the year (Note 20).

16.	Creditors: Amounts falling due after more than one year
		2024	2023
		£	£

Bank loans (Note 17)	5,172,435	887,053
Net obligations under finance leases and hire purchase contracts	2,745,242	2,817,760
Other creditors	2,720	101,734
Share capital treated as debt	-	650,000
	7,920,397	4,456,547

Page 22


TWELVE NESS WALK LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

Amounts falling due within one year
Bank loans	261,009	3,709,402
	261,009	3,709,402
Amounts falling due 1-2 years
Bank loans	261,009	887,053
	261,009	887,053
Amounts falling due 2-5 years
Bank loans	4,911,426	-
	4,911,426	-

	5,433,444	4,596,455

During the year the the company and its fellow subsidiary Kingsmills Hotel (Inverness) Ltd refinanced all loans into one facility. The facility is repayable in quarterly instalments which commenced in 2024. The term of the facility is three years with an option for an additional two years. Interest is paid at the Bank of England base rate plus 1.93%.
Bank loans and overdrafts are secured by cross guarantee by the company and other group companies together with standard and floating securities. The total group debt as at 31 December 2024 is £20,275,777 (2023 - £19,584,513).

Page 23


TWELVE NESS WALK LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

Within one year	72,518	74,331
Between 1-5 years	272,812	279,632
Over 5 years	2,472,430	2,538,128
	2,817,760	2,892,091

During 2019 the company entered into an arrangement to sell and leaseback, on a 125 year lease, the property from which the hotel operates. As the company has the option to buy the property at the end of the lease for a nominal amount the transaction was recorded as a financing arrangement and no disposal of property or gain on disposal was recorded in the accounts.

Page 24


TWELVE NESS WALK LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

19.	Deferred taxation

		2024
		£

	At beginning of year	2,315,129
	Charged to profit or loss	(32,276)
	At end of year	2,282,853

The provision for deferred taxation is made up as follows:
	2024	2023
	£	£

Accelerated capital allowances	86,103	188,546
Tax losses carried forward	-	(51,667)
Revaluation of assets	1,881,500	1,863,000
Rollover relief	315,250	315,250
	2,282,853	2,315,129

Allotted, called up and fully paid

100 (2023 - 100) Ordinary shares of £1.00 each	100	100

					2023
					£
	Shares classified as debt

Allotted, called up and fully paid

Nil (2023 - 775,000) Preference shares of £1.00 each	-	775,000

During the year 775,000 6% Preference shares of £1 were repaid at par.

Page 25


TWELVE NESS WALK LIMITED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

21.

Related party transactions

The company has taken advantage of the exemption given by FRS 102 Section 33 which allows exemption from disclosure of related party transactions with wholly owned group companies.
During the year the company provided loans to a company under common ownership amounting to £132,500 (2023 - £545,185). Interest is being charged on the loans at a rate of 2.5%. There are no fixed repayment terms. During the year the company received interest on a loan to a company under common ownership amounting to £47,924 (2023 - £42,810). At year end the net balance of due from this company was £2,093,565 (2023 - £2,058,822).
During the year the company repaid preference shares with a value of £775,000 (2023 - £125,000) and has paid preference dividends amounting to £21,390 (2023 - £50.250).
During the year the company has incurred management fees of £120,834 from a company with common shareholders and paid interest on loans of £nil and repaid amounts totalling £Nil. The balance owed to this entity at the year end is £99,436 (2023 - £101,733).

22.	Controlling party

The company's immediate parent undertaking is Patio Hotels (UK) Limited. The ultimate parent undertaking is DLT Capital Group (International) Limited, a company incorporated in Gibraltar.

Page 26