Statement of compliance

These financial statements have been prepared in compliance with FRS 102(1A) The Financial Reporting Standard applicable in the UK and Republic of Ireland and the Companies Act 2006.

Basis of preparation

The financial statements have been prepared under the historical cost convention as modified by the revaluation of land and buildings and certain financial instruments measured at fair value in accordance with the accounting policies.

The financial statements are prepared in sterling which is the functional currency of the company.

The directors believe that the company is experiencing good levels of sales growth and profitability, and that it is well placed to manage its business risks successfully. Accordingly, they have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Thus they continue to adopt the going concern basis of accounting in preparing the financial statements.

Turnover is measured at the fair value of the consideration received or receivable net of VAT and trade discounts. Turnover includes revenue earned from property rental.  Rental income is recognised at the beginning of the period it becomes available for letting.  Charges for support services and management charges are recognised as they fall due under the contractual arrangements.

Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable or refundable using the tax rates and laws that have been enacted or substantively enacted by the statement of financial position date.

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position date. 

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Deferred tax liabilities are presented within provisions for liabilities and deferred tax assets within debtors. Deferred tax assets and deferred tax liabilities are offset only if the company has legal right to set off against current tax liabilities and if they both relate to income tax levied by the same taxation authority on the same entity.

Investment properties are included in the statement of financial position at their open market value at the statement of financial position date. The resulting aggregate surplus or deficit is transferred to a revaluation reserve. Depreciation is provided only on those investment properties which are leasehold and where the unexpired lease term is less than 20 years.

Although this accounting policy is in accordance with the Financial Reporting Standard for Smaller Entities (effective January 2015), it is a departure from the general requirement of the Companies Act 2006 for all tangible assets to be depreciated. In the opinion of the directors compliance with the standard is necessary for the statement of financial position to give a true and fair view. Depreciation or amortisation is only one of many factors reflected in the annual valuation and the amount of this which might otherwise have been charged cannot be separately identified or quantified.  The directors have confirmed that the carrying value of the investment property is appropriate in the statement of financial position.

Non-basic financial instruments are recognised at fair value using a valuation technique with any gains or losses being reported in surplus or deficit. At the end of each accounting period, the instruments are revalued to fair value, with the movements posted to the income and expenditure report.

Total financial commitments in relation to the mortgage for the investment property totalled £708,281 (2024: £727,380) owing to Lloyds Bank PLC  at the end of the accounting period.  The secured business loan is for 25 years to be repaid in full at the end of the 2043 calendar year.  The interest rate on the loan is 2.15% over the Bank of England base rate payable at 1 month intervals.  The bank loan is secured by the investment property 2 Claridge Court, Lower Kings Road, HP4 2AF, the associated companies Allazo Ltd and Allazo Accounting Ltd and joint guarantees from Mr J Pugsley and Ms H Fegan totalling £100,000.

• Valuation of investment properties:  The Directors have used appropriate levels of research to ensure the carrying value of the property is at fair value in line with section 17 of FRS102.