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Registered number: 14258888
OTTO CAR SPV1 LTD
FINANCIAL STATEMENTS
INFORMATION FOR FILING WITH THE REGISTRAR
FOR THE YEAR ENDED 31 MARCH 2025
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OTTO CAR SPV1 LTD
REGISTERED NUMBER: 14258888
STATEMENT OF FINANCIAL POSITION
AS AT 31 MARCH 2025
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Debtors: amounts falling due after more than one year
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Creditors: amounts falling due after more than one year
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Provisions for liabilities
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OTTO CAR SPV1 LTD
REGISTERED NUMBER: 14258888
STATEMENT OF FINANCIAL POSITION (CONTINUED)
AS AT 31 MARCH 2025
The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime and in accordance with the provisions of FRS 102 Section 1A - small entities.
The financial statements have been delivered in accordance with the provisions applicable to companies subject to the small companies regime.
The Company has opted not to file the statement of comprehensive income in accordance with 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 by:
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G S Dhillon
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The notes on pages 3 to 15 form part of these financial statements.
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OTTO CAR SPV1 LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
The entity is a private limited company limited by shares incorporated in England and Wales. The registered office of the entity is 3 Sussex Place, London, W6 9EA. The principal activity of the company is the renting and leasing of cars and light motor vehicles.
2.Accounting policies
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Basis of preparation of financial statements
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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 disclosure requirements of Section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.
The financial statements are presented in £ Sterling, the functional currency, rounded to the nearest £1.
The financial statements reflect a prior period adjustment as a result of a change of accounting policy, see note 17.
The following principal accounting policies have been applied:
The company has net current liabilities of £2,315,696 (2024 restated: net current liabilities £981,524) however there are net assets of £1,494,418 (2024 restated: net assets £396,993) at the balance sheet date. Overall, the net asset base is primarily driven by the finance lease debtors which represents the net investment in contractual Rent to Buy agreements with drivers and for which there are contractually agreed cash flows over the term of the agreement. The total value of these agreements are more than sufficient to cover the cash outflows of the business. The directors do not consider that there are any immediate short term cash flow issues based on their forecasts which are reviewed regularly. The directors consider that in the event that an agreement is cancelled by a driver, the underlying vehicle under the Rent to Buy contract would be returned to the company and would be initially held as stock. The vehicle would then be available to be sold under a further Rent to Buy agreement or may be used on a short term rental basis in the meantime. Demand is strong and stock utilisation is good. Based on these assessments and having regard to the post year end trading status of the entity, which is now more than a year from the balance sheet date, the Directors have concluded that there is no material uncertainty and that they can continue to adapt the going concern basis in preparing the annual report and accounts.
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OTTO CAR SPV1 LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
2.Accounting policies (continued)
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:
Sale of goods
Revenue from the sale of goods is recognised when all of the following conditions are satisfied:
∙the Company has transferred the significant risks and rewards of ownership to the buyer;
∙the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
∙the amount of revenue can be measured reliably;
∙it is probable that the Company will receive the consideration due under the transaction; and
∙the costs incurred or to be incurred in respect of the transaction can be measured reliably.
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.
The company recognises three primary types of revenue: Rent to Buy income, rental income, and other income.
Rent to Buy contracts are finance leases where the risks and rewards over the vehicle pass to the customer. Rent to Buy contracts gives rise to two types of income: profit or loss equivalent to the profit or loss resulting from outright sale of the asset being leased, at normal selling prices, reflecting any applicable discounts, and finance income over the lease term where the finance lease asset is held under amortised cost. The capital element of customer payments offsets against the finance lease debtor and the interest element of the payment is recognised as revenue.
Vehicles sold under a Rent to Buy contract are expensed as a cost of sale through the Profit and Loss Account.
Rental contracts are short term operating leases and are recognised on a straight line accruals basis as the income is earnt. Other income is recognised on the same basis.
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Leased assets: the Company as lessee
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Assets obtained under hire purchase contracts are obtained either to be sold under Rent to Buy contracts (finance leases) or for the purpose of short term rental contracts (operating leases).
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OTTO CAR SPV1 LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
2.Accounting policies (continued)
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Leased assets: the Company as lessee (continued)
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Where an asset is obtained for the purpose of Rent to Buy contracts it is recognised as stock at acquisition. Once the Rent to Buy contract is agreed with the customer the company recognises as a receivable an amount equal to the net investment in the lease i.e. the minimum lease payments receivable under the lease discounted at the interest rate implicit in the lease. This receivable is reduced as the lessee makes capital payments over the term of the lease.
Where an asset is obtained for the purpose of short term rental contracts, the assets are capitalised as tangible fixed assets at acquisition. Assets acquired by finance lease are depreciated over the shorter of the lease term and their useful lives. Assets acquired by hire purchase are depreciated over their useful lives.
Finance leases are those where substantially all of the benefits and risks of ownership are assumed by the company. Obligations under such agreements are included in creditors net of the finance charge allocated to future periods. The finance element of the rental payment is charged to profit or loss so as to produce a constant periodic rate of charge on the net obligation outstanding in each period.
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Leased assets: the Company as lessor
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Where assets leased to a third party give rights approximating to ownership (finance lease), the lessor recognises as a receivable an amount equal to the net investment in the lease i.e. the minimum lease payments receivable under the lease discounted at the interest rate implicit in the lease. This receivable is reduced as the lessee makes capital payments over the term of the lease.
A finance lease gives rise to two types of income: profit or loss equivalent to the profit or loss resulting from outright sale of the asset being leased, at normal selling prices, reflecting any applicable discounts, and finance income over the lease term.
The company's Rent to Buy contracts are treated as finance leases where the company is the lessor.
Interest income is recognised in profit or loss using the effective interest method.
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.
All borrowing costs are recognised in profit or loss in the year in which they are incurred.
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OTTO CAR SPV1 LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
2.Accounting policies (continued)
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Current and deferred taxation
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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 reporting 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 reporting date, except that:
∙The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; 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 reporting date.
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OTTO CAR SPV1 LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
2.Accounting policies (continued)
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:
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.
When a vehicle is first acquired the vehicle is recognised as stock and valued at cost, unless it has been purchased for the purpose of short term rental contracts in which case it is capitalised as tangible fixed assets. Where vehicles were thought to be intended for Rent to Buy contracts and recognised in stock but the intention subsequently changes, or where vehicles were on Rent to Buy contracts which are terminated and moved back to stock, and subsequently are used on short term rental contracts, these vehicles are transferred to fixed assets.
Once recognised as a fixed asset a vehicle is valued at cost less any principal payments made by a customer during any previous Rent to Buy contract and then depreciated in line with the above policy, and then remains classified as such until the short term rental comes to an end or the decision is made to sell the vehicle outright.
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.
At each reporting 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.
When a vehicle is first acquired the vehicle is recognised as stock and valued at cost, unless it has been purchased for the purpose of short term rental contracts in which case it is capitalised as tangible fixed assets.
Vehicles sold under a Rent to Buy contract are expensed as a cost of sale through the Profit and Loss Account.
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OTTO CAR SPV1 LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
2.Accounting policies (continued)
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.
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Cash and cash equivalents
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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.
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.
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Provisions for liabilities
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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.
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 Statement of financial position 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 debtors, cash and bank balances, are initially measured at their transaction price (adjusted for transaction costs except in the initial measurement of financial assets that are subsequently measured at fair value through profit and loss) and are subsequently carried at their amortised cost using the effective interest method, less any provision for impairment, unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest.
Discounting is omitted where the effect of discounting is immaterial. The Company's cash and cash equivalents, trade and most other debtors due with the operating cycle fall into this category of financial instruments.
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OTTO CAR SPV1 LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
2.Accounting policies (continued)
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Financial instruments (continued)
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Impairment of financial assets
At the end of each reporting period financial assets measured at amortised cost are assessed for objective evidence of impairment. If an asset is impaired the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
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.
Basic financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the Company after the deduction of all its liabilities.
Basic financial liabilities, which include trade and other creditors, bank loans and other loans are initially measured at their transaction price (adjusting for transaction costs except in the initial measurement of financial liabilities that are subsequently measured at fair value through profit and loss). When this constitutes a financing transaction, whereby the debt instrument is measured at the present value of the future payments discounted at a market rate of interest, discounting is omitted where the effect of discounting is immaterial.
Debt instruments are subsequently carried at their amortised cost using the effective interest rate method.
Trade creditors are obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers. Trade creditors are classified as current liabilities if the payment is due within one year. If not, they represent non-current liabilities. Trade creditors are initially recognised at their transaction price and subsequently are measured at amortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial.
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
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OTTO CAR SPV1 LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
2.Accounting policies (continued)
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Financial instruments (continued)
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Financial liabilities are derecognised when the Company's contractual obligations expire or are discharged or cancelled.
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The average monthly number of employees, including directors, during the year was 1 (2024 - 1).
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At 1 April 2024 as restated
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Transfers from stock/(to stock)
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At 1 April 2024 as restated
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At 31 March 2024 as restated
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OTTO CAR SPV1 LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
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Due after more than one year
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Prepayments and accrued income
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Prepayments and accrued income
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Finance Leases
The finance income earned on the net investment in finance leases during the year was £1,669,030 (2024: £822,515 as restated). The selling profit or loss incurred on new finance lease agreements made in the year was £Nil (2024: £Nil as restated).
The total amount due from finance leases within one year is £7,716,960 (2024: £7,488,320 as restated), within one to two years is £2,879,232 (2024: £3,182,326 as restated) and over two years £5,163,023 (2024: £4,178,818 as restated).
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OTTO CAR SPV1 LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
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Cash and cash equivalents
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Creditors: Amounts falling due within one year
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Amounts owed to group undertakings
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Other taxation and social security
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Accruals and deferred income
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Bank loans of £2,177,214 (2024: £1,638,000) relate to an asset based financing agreement and are secured by a debenture over the assets held by the company.
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Creditors: Amounts falling due after more than one year
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Bank loans of £5,495,155 (2024: £6,124,635) relate to an asset based financing agreement and are secured by a debenture over the assets held by the company.
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OTTO CAR SPV1 LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
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Analysis of the maturity of loans is given below:
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Amounts falling due within one year
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Amounts falling due 1-2 years
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Amounts falling due 2-5 years
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OTTO CAR SPV1 LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
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At beginning of year (as restated)
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Charged to profit or loss
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The provision for deferred taxation is made up as follows:
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Accelerated capital allowances
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Allotted, called up and fully paid
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100 (2024 - 100) Ordinary shares of £1.00 each
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The company is currently in ongoing discussions with HMRC to resolve issues that have been raised relating to the company’s application of recovery of input VAT and the treatment of insurance income. On the basis of discussions and advice to date, the directors believe that no material loss to the company will occur. However, at this stage, the value of any potential adjustments, if any, cannot be quantified and so it is impracticable to calculate any liability that may arise.
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Related party transactions
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The company has taken advantage of the exemption available under paragraph 33.1A of the Financial Reporting Standard 102 not to disclose transactions with other wholly owned members of the Group.
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OTTO CAR SPV1 LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2025
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Parent entity and Controlling party
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The company was under the control of Mr G Dhillon throughout the current and prior year by virtue of his shareholding in Otto Group Holdings Limited, the parent company of Otto Car SPV 1 Limited. The registered office of Otto Group Holdings Limited is 3 Sussex Place, London, W6 9EA.
During the year and post year end, the Directors reviewed the accounting treatment applied to the Company's Rent to Buy vehicle contracts. In prior years, the vehicles subject to these contracts were accounted for as operating leases for lessors.
Following a review of the contractual arrangements and consideration of relevant professional guidance, the Directors concluded that the Rent to Buy contracts meet the definition of finance leases under FRS 102. Accordingly, the Company has revised its accounting policy and now accounts for these arrangements as finance leases.
The change in accounting policy has been applied retrospectively in accordance with FRS 102. As a result, the comparative figures for the prior year have been restated to recognise the assets subject to Rent to Buy contracts as finance lease assets.
The effect of the prior year adjustment on the statement of financial position is set out below:
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Property, plant and equipment (7,361,289)
Inventory (91,844)
Receivables due in more than one year 7,673,706
Receivables due within one year 7,488,320
Liabilities due within one year (7,679,701)
Brought forward retained earnings as at 1 April 2023 (346,163)
Carried forward retained earnings as at 31 March 2024 (29,192)
The effect of the prior year adjustment on the statement of comprehensive income is set out below:
Revenue (6,550,821)
Cost of sales 6,508,564
The comparative figrures and corresponding notes to the financial statements have been restated to reflect the above change in accounting policy.
The auditors' report on the financial statements for the year ended 31 March 2025 was unqualified.
The audit report was signed on 16 October 2026 by Georgette Alicia Crisp, BSc (Hons) FCA (Senior statutory auditor) on behalf of MHA.
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