The company has no income or expenditure in its own right from which it derives economic benefit.
Whilst certain contracts are entered into in the name of the company, acting as principal, the settlement of the liabilities arising is covered by service charges demanded from leaseholders and administered through funds held in trust solely for this purpose.
4. Restatement of Comparative Figures
The directors have reviewed the accounting treatment of service charge transactions undertaken by the Company in connection with the management and maintenance of the properties.
Although certain contracts with third-party suppliers are entered into in the name of the Company, the associated liabilities are funded by service charges demanded from leaseholders and administered through funds held on trust solely for this purpose. The Company does not derive any economic benefit from these transactions in its own right.
In previous financial statements, service charge transactions were recognised in the Company's profit and loss account with the resulting profits or losses transferred to retained earnings. The directors have concluded that this treatment was inappropriate and have corrected the prior-period error in accordance with Section 8 of FRS 105.
The correction removes service charge transactions from the Company's profit and loss account and adjusts the opening retained earnings and comparative figures accordingly. Following the correction, the Company's retained earnings comprise only amounts attributable to the Company in its own right.
|
Financial statement item
|
Previously reported
|
|
Restated
|
|
£
|
|
£
|
|
Retained earnings at 30 September 2023
|
6,861
|
|
nil
|
|
Retained earnings at 30 September 2024
|
3,393
|
|
nil
|