Registered number:
05995442
REED HOMES LTD
UNAUDITED
FINANCIAL STATEMENTS
INFORMATION FOR FILING WITH THE REGISTRAR
FOR THE YEAR ENDED 31 DECEMBER 2020
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REED HOMES LTD
REGISTERED NUMBER:
05995442
BALANCE SHEET
AS AT
31 DECEMBER 2020
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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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REED HOMES LTD
REGISTERED NUMBER:
05995442
BALANCE SHEET
(CONTINUED)
AS AT
31 DECEMBER 2020
The director considers that the Company is entitled to exemption from audit under section 477 of the Companies Act 2006 and members have not required the Company to obtain an audit for the year in question in accordance with section 476 of the Companies Act 2006.
The director acknowledges his responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.
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
:
................................................
Mr D Reed
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The notes on pages 4 to 10 form part of these financial statements.
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REED HOMES LTD
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED
31 DECEMBER 2020
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At 1 January 2019 (as previously stated)
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At 1 January 2019 (as restated)
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Comprehensive income for the year
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Comprehensive income for the year
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Surplus on revaluation of freehold property
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The notes on pages 4 to 10 form part of these financial statements.
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REED HOMES LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Reed Homes Ltd is a private company limited by shares and registered in England and Wales. The registered office is Tennyson House, Cambridge Business Park, Cambridge, CB4 0WZ.
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 Section 1A of
Financial Reporting Standard 102, the Financial Reporting Standard applicable in
the UK and the Republic of Ireland and the Companies Act 2006
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The following principal accounting policies have been applied:
The director has considered the going concern basis in preparing these financial statements. He has concluded that the going concern basis is appropriate because sufficient funds will be generated from future trading and he has confirmed he will provide continued support for a period of at least twelve months from the date of the approval of these financial statements to enable the company to meet its liabilities as they arise. The director has considered the impact of the COVID-19 pandemic and does not believe the adverse impact will affect the going concern basis.
The company has breached banking covenants and therefore total bank loans have been classified
within creditors due within one year.
The financial statements do not include any adjustments that would be result from the withdrawal of this support.
Turnover is recognised to the extent that it is probable that the economic benefits will flow to the
Company and the turnover can be reliably measured. Turnover 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 turnover is recognised:
Site Fees
Site fees are recognised on an accruals basis in the period to which they relate.
Sales of residential homes & caravans
Sales of residential homes are recognised when the risks and rewards of ownership are transferred to the customer, usually on occupation when the licence agreement is signed or legal completion takes place.
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.
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REED HOMES LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
2.
Accounting policies (continued)
All borrowing costs are recognised in profit or loss in the year in which they are incurred.
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Corporation and deferred taxation
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The tax expense for the year comprises corporation 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 corporation 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
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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.
Exceptional items are transactions that fall within the ordinary activities of the Company but are presented separately due to their size or incidence.
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.
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REED HOMES LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
2.
Accounting policies (continued)
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Tangible fixed assets (continued)
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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.
No depreciation has been provided on freehold property as the property is maintained in such a state of repair that its residual value is at least equal to its net book value. As a result the corresponding depreciation would not be material and therefore is not charged to profit or loss.
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Revaluation of tangible fixed assets
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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.
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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REED HOMES LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
2.
Accounting policies (continued)
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Provisions for liabilities
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Provisions are made where an event has taken place that gives the Company a legal or constructive obligation that probably requires settlement by a transfer of economic benefit, and a reliable estimate can be made of the amount of the obligation.
Provisions are charged as an expense to profit or loss in the year that the Company becomes aware of the obligation, and are measured at the best estimate at the balance sheet date of the expenditure required to settle the obligation, taking into account relevant risks and uncertainties.
When payments are eventually made, they are charged to the provision carried in the Balance Sheet.
The Company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
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The average monthly number of employees, including directors, during the year was 2
(2019 -
2
)
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Charge for the year on owned assets
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REED HOMES LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Cost or valuation at 31 December 2020 is as follows:
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If the land and buildings had not been included at valuation they would have been included under the historical cost convention as follows:
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The freehold property revaluation is based on the director's valuation.
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Amounts owed by joint ventures and associated undertakings
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Creditors: Amounts falling due within one year
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Amounts owed to other participating interests
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Other taxation and social security
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Accruals and deferred income
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REED HOMES LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
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Creditors: Amounts falling due after more than one year
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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 2-5 years
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Amounts falling due after more than 5 years
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The bank loan is secured by a fixed and floating charge over the assets of the company.
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Charged to other comprehensive income
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The deferred taxation balance is made up as follows:
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Deferred tax on freehold property
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REED HOMES LTD
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Prior year adjustments have been recorded as follows:
The corporation tax creditor at 31 December 2019 of £49,125 was understated by £36,612 as this had been written off previously to cost of sales. The write off has now been reversed.
There is no effect on the tax charge as a result of the above adjustment because no tax releif was taken in the prior year.
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Related party transactions
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The company was owed £37,077 (2019 - £38,494) by a company which is under common control. This loan is interest free, unsecured and repayable on demand. Provision of £13,000 ( 2020 £38,494) has been made against this loan.
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The Ultimate Controlling Party is Mr D Reed by virtue of his 100% shareholding in Reed Homes Limited.
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