Company Registration No. 07185858 (England and Wales)
MULBURY HOMES LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2019
MULBURY HOMES LIMITED
COMPANY INFORMATION
Directors
W M Bury
G J Mulligan
D A McLaughlin
Company number
07185858
Registered office
Great Oak Farm
Mag Lane
Lymm
Cheshire
WA13 0TF
Auditor
Champion Accountants LLP
1 Worsley Court
High Street
Worsley
Manchester
M28 3NJ
MULBURY HOMES LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Independent auditor's report
4 - 6
Statement of income and retained earnings
7
Balance sheet
8
Statement of cash flows
9
Notes to the financial statements
10 - 23
MULBURY HOMES LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2019
- 1 -
The directors present the strategic report for the year ended 31 March 2019.
Business environment
The company operates in the construction sector which provides for affordable social housing. This sector continues to be buoyant due to ever increasing prices in the general housing market. Consequently, the company continues to increase the number of projects it is involved with and the directors are confident that more opportunities will emerge in the current year. In addition the company has completed its first small open market scheme and is about to commence its second.
Risk management
The company faces operational risks and uncertainties which the directors take all reasonable steps possible to mitigate, however the directors recognise that they can never be eliminated completely. These risks are not expected to have a material effect on the company's future operations.
Results and performance
During 2019, the company traded well as forecasted as the pipeline improved markedly and more sites were developed.
The financial performance was as expected an in line with the Board of Director's forecasts. Turnover increased to £38.21m (2018: £26.96m) with profit after taxation decreasing to £14.1k (2018: £94.4k). Due to the increasing pipeline however, the Directors are confident that Turnover and profitability will increase in the current year.
Strategy
The company specialises in the procurement and delivery of quality affordable housing as well as the support services that are vital to creating vibrant and inspiring neighbourhood schemes. Our total solutions approach aims to manage each project from identifying the initial land opportunity, through to producing a detailed specification design followed by full site development.
W M Bury
G J Mulligan
Director
Director
17 December 2019
17 December 2019
MULBURY HOMES LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2019
- 2 -
The directors present their annual report and financial statements for the year ended 31 March 2019.
Principal activities
The principal activity of the company continued to be in residential development.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
W M Bury
G J Mulligan
D A McLaughlin
(Appointed 7 October 2019)
Results and dividends
The results for the year are set out on page 7.
Ordinary dividends were paid amounting to £120,000. The directors do not recommend payment of a further dividend.
Auditor
The auditor, Champion Accountants LLP, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
Statement of directors' responsibilities
The directors are responsible for preparing the annual 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 United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). 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 and then apply them consistently;
-
make judgements 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 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.
MULBURY HOMES LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2019
- 3 -
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.
On behalf of the board
W M Bury
G J Mulligan
Director
Director
17 December 2019
MULBURY HOMES LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF MULBURY HOMES LIMITED
- 4 -
Opinion
We have audited the financial statements of Mulbury Homes Limited (the 'company') for the year ended 31 March 2019 which comprise the statement of income and retained earnings, the balance sheet, the statement of cash flows and notes to the financial statements, 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 FRS 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 March 2019 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.
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
Auditor's
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 UK, including the FRC’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
We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:
-
the directors' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or
-
the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the company’s ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue
.
The directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. 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.
In connection with our audit of the financial statements, 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 audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. 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.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit
:
-
the information given in the strategic report and the directors' r
eport 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.
MULBURY HOMES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF MULBURY HOMES LIMITED
- 5 -
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 identifie
d
material misstatements in the strategic report and the directors'
r
eport
.
We have nothing to report in respect of the following matters where 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'
r
esponsibilities
s
tatement, 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.
Auditor's 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 auditor’s 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.
A further description of our responsibilities for the audit of the financial statements is located on the
Financial Reporting Council’s website at: http://www.frc.org.uk/auditorsresponsibilities
.
This description forms part of our auditor’s report.
MULBURY HOMES LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF MULBURY HOMES LIMITED
- 6 -
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 auditor's 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.
Mark Turner FCA (Senior Statutory Auditor)
for and on behalf of Champion Accountants LLP
17 December 2019
Chartered Accountants
Statutory Auditor
1 Worsley Court
High Street
Worsley
Manchester
M28 3NJ
MULBURY HOMES LIMITED
STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE YEAR ENDED 31 MARCH 2019
- 7 -
2019
2018
Notes
£
£
Turnover
4
38,211,111
26,963,098
Cost of sales
(34,746,310)
(25,531,396)
Gross profit
3,464,801
1,431,702
Administrative expenses
(3,729,535)
(2,847,129)
Other operating income
292,500
1,562,000
Operating profit
5
27,766
146,573
Interest payable and similar expenses
8
-
(19,218)
Profit before taxation
27,766
127,355
Tax on profit
9
(13,636)
(32,946)
Profit for the financial year
14,130
94,409
Retained earnings brought forward
1,277,377
1,182,968
Dividends
10
(120,000)
-
Retained earnings carried forward
1,171,507
1,277,377
The profit and loss account has been prepared on the basis that all operations are continuing operations.
MULBURY HOMES LIMITED
BALANCE SHEET
AS AT
31 MARCH 2019
31 March 2019
- 8 -
2019
2018
Notes
£
£
£
£
Fixed assets
Tangible assets
11
29,480
31,269
Investments
12
42
-
29,522
31,269
Current assets
Debtors
15
12,351,951
9,211,363
Cash at bank and in hand
209,905
1,175,446
12,561,856
10,386,809
Creditors: amounts falling due within one year
16
(11,416,651)
(9,137,460)
Net current assets
1,145,205
1,249,349
Total assets less current liabilities
1,174,727
1,280,618
Provisions for liabilities
17
(3,218)
(3,239)
Net assets
1,171,509
1,277,379
Capital and reserves
Called up share capital
20
2
2
Profit and loss reserves
21
1,171,507
1,277,377
Total equity
1,171,509
1,277,379
The financial statements were approved by the board of directors and authorised for issue on 17 December 2019 and are signed on its behalf by:
W M Bury
G J Mulligan
Director
Director
Company Registration No. 07185858
MULBURY HOMES LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2019
- 9 -
2019
2018
Notes
£
£
£
£
Cash flows from operating activities
Cash (absorbed by)/generated from operations
1
(846,042)
1,243,772
Interest paid
-
(19,218)
Income taxes paid
-
(61,600)
Net cash (outflow)/inflow from operating activities
(846,042)
1,162,954
Investing activities
Purchase of tangible fixed assets
(19,619)
(23,144)
Proceeds on disposal of associates
(42)
-
Proceeds from other investments and loans
20,162
(118,428)
Net cash generated from/(used in) investing activities
501
(141,572)
Financing activities
Dividends paid
(120,000)
-
Net cash used in financing activities
(120,000)
-
Net (decrease)/increase in cash and cash equivalents
(965,541)
1,021,382
Cash and cash equivalents at beginning of year
1,175,446
154,064
Cash and cash equivalents at end of year
209,905
1,175,446
MULBURY HOMES LIMITED
STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2019
- 10 -
1
Cash (absorbed by)/generated from operations
2019
2018
£
£
Profit for the year after tax
14,130
94,409
Adjustments for:
Taxation charged
13,636
32,946
Finance costs
-
19,218
Depreciation and impairment of tangible fixed assets
21,408
12,456
Movements in working capital:
Increase in debtors
(3,160,750)
(4,822,901)
Increase in creditors
2,265,534
5,907,644
Cash (absorbed by)/generated from operations
(846,042)
1,243,772
2
Accounting policies
Company information
Mulbury Homes Limited is a
private
company
limited by shares
incorporated in England and Wales.
The registered office is
Great Oak Farm, Mag Lane, Lymm, Cheshire, WA13 0TF.
2.1
Accounting convention
These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.
The financial statements are prepared in
sterling
, which is the functional currency of the company.
Monetary a
mounts
in these financial statements are
rounded to the nearest £.
The financial statements have been prepared under the historical cost convention, modified to include the revaluation of freehold properties and to include investment properties and certain financial instruments at fair value. The principal accounting policies adopted are set out below.
2.2
Going concern
A
true
t the time of approving the financial statements
,
t
he directors have a reasonable expectation that the
company
has adequate resources to continue in operational existence for the foreseeable future. Thus
t
he directors continue to adopt the going concern basis of accounting in preparing the financial statements.
2.3
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business
, and
is shown net of VAT and other sales related taxes
.
The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
When cash inflows are deferred and represent a financing arrangement, the fair value of the consideration is the present value of the future receipts. The difference between the fair value of the consideration and the nominal amount received is recognised as interest income.
MULBURY HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2019
2
Accounting policies
(Continued)
- 11 -
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer
(usually on dispatch of the goods)
, the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.
Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that
it is probable will be
recover
ed
.
2.4
Tangible fixed assets
Tangible fixed assets
are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.
Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:
Leasehold improvements
Over the term of the lease
Fixtures and fittings
20% straight line
Computers
33% straight line
The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and
is credited or charged to profit or loss
.
2.5
Fixed asset investments
Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.
The investments are assessed for impairment at each reporting date
and
any
impairment
losses or reversals of impairment losses are recognised immediately in profit or loss.
A subsidiary is an entity controlled by the company
. Control is
the power to govern the financial and operating policies of
the
entity so as to obtain benefits from its activities.
An associate is an entity, being neither a subsidiary nor a joint venture, in which the company holds a long-term interest and where the company has significant influence. The company considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.
Entities in which the company has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities
.
2.6
Impairment of fixed assets
At each reporting
period
end date, the
company
reviews the carrying amounts of its tangible
assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company
estimates the recoverable amount of the cash-generating unit to which the asset belongs.
MULBURY HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2019
2
Accounting policies
(Continued)
- 12 -
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit)
in
prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
2.7
Construction contracts
Where the outcome of a construction contract can be estimated reliably, revenue and costs are recognised by reference to the stage of completion of the contract activity at the reporting end date. Variations in contract work, claims and incentive payments are included to the extent that the amount can be measured reliably and its receipt is considered probable.
When it is probable that total contract costs will exceed total contract turnover, the expected loss is recognised as an expense immediately.
Where the outcome of a construction contract cannot be estimated reliably, contract revenue is recognised to the extent of contract costs incurred where it is probable that they will be recoverable. Contract costs are recognised as expenses in the period in which they are incurred. When costs incurred in securing a contract are recognised as an expense in the period in which they are incurred, they are not included in contract costs if the contract is obtained in a subsequent period.
The “percentage of completion method” is used to determine the appropriate amount to recognise in a given period. The stage of completion is measured by the proportion of contract costs incurred for work performed to date compared to the estimated total contract costs. Costs incurred in the year in connection with future activity on a contract are excluded from contract costs in determining the stage of completion. These costs are presented as stocks, prepayments or other assets depending on their nature, and provided it is probable they will be recovered.
2.8
Cash and cash equivalents
Cash and cash equivalents
are basic financial assets
and
include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.
MULBURY HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2019
2
Accounting policies
(Continued)
- 13 -
2.9
Financial instruments
The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ 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 debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest
method 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.
Financial assets classified as receivable within one year are not amortised.
Other financial assets
Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.
Impairment of financial assets
Financial assets, other than those
held
at
fair value through profit and loss
, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected.
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.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when
the company
transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Classification of 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 deducting all of its liabilities.
MULBURY HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2019
2
Accounting policies
(Continued)
- 14 -
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from
fellow group companies and preference shares that are classified as debt, are
initially recognised at transaction price unless the arrangement constitutes a
financing transaction, where the debt instrument is measured at the present value of
the future
paymen
ts discounted at a market rate of interest.
Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective
interest rate method.
Trade creditors
are obligations to pay for goods or services that have been acquired
in the ordinary course of business from suppliers. A
m
ounts payable are classified as
current liabilities if payment is due within one year or less. If not, they are presented
as non-current liabilities. Trade creditors are recognised initially at transaction price
and subsequently measured at amortised cost using the effective interest method.
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts,
are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are
s
ubsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as
being measured at
fair value though profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations
expire or are discharged or cancelled.
2.10
Equity instruments
Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.
2.11
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The
company’s
liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
MULBURY HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2019
2
Accounting policies
(Continued)
- 15 -
Deferred tax
Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the
company
has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.
2.12
Employee benefits
The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.
The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.
Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.
2.13
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
2.14
Leases
Rentals payable under operating leases,
including
any lease incentives received, are charged to
profit or loss
on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the lease
s
asset are consumed.
3
Judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.
Recognition of turnover and therefore profit is based on judgments made in respect of the ultimate profitability of a contract or project. Such judgments are arrived at through the use of estimates in relation to costs and value of work performed to date and to be performed in bringing contracts or projects to completion, based on current project appraisals and known cost movements against appraisals.
MULBURY HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2019
- 16 -
4
Turnover and other revenue
2019
2018
£
£
Turnover analysed by class of business
Construction contracts
38,211,111
26,963,098
2019
2018
£
£
Turnover analysed by geographical market
United Kingdom
38,211,111
26,963,098
5
Operating profit
2019
2018
Operating profit for the year is stated after charging:
£
£
Fees payable to the company's auditor for the audit of the company's financial statements
12,000
7,500
Depreciation of owned tangible fixed assets
21,408
12,456
Operating lease charges
135,564
130,784
6
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2019
2018
Number
Number
Administrative staff
39
24
Directors
2
2
41
26
Their aggregate remuneration comprised:
2019
2018
£
£
Wages and salaries
2,071,148
1,376,050
Social security costs
250,358
194,309
Pension costs
66,510
64,852
2,388,016
1,635,211
MULBURY HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2019
- 17 -
7
Directors' remuneration
2019
2018
£
£
Remuneration for qualifying services
16,228
14,832
Company pension contributions to defined contribution schemes
-
5,629
16,228
20,461
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 2 (2018 - 2).
8
Interest payable and similar expenses
2019
2018
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
-
231
Other finance costs:
Other interest
-
18,987
-
19,218
9
Taxation
2019
2018
£
£
Current tax
UK corporation tax on profits for the current period
13,657
32,351
Deferred tax
Origination and reversal of timing differences
(21)
595
Total tax charge
13,636
32,946
MULBURY HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2019
9
Taxation
(Continued)
- 18 -
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2019
2018
£
£
Profit before taxation
27,766
127,355
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2018: 19.00%)
5,276
24,197
Tax effect of expenses that are not deductible in determining taxable profit
7,159
8,881
Permanent capital allowances in excess of depreciation
1,201
(132)
Taxation charge for the year
13,636
32,946
10
Dividends
2019
2018
£
£
Final paid
120,000
-
11
Tangible fixed assets
Leasehold improvements
Fixtures and fittings
Computers
Total
£
£
£
£
Cost
At 1 April 2018
7,451
34,978
29,760
72,189
Additions
5,183
1,405
13,031
19,619
At 31 March 2019
12,634
36,383
42,791
91,808
Depreciation and impairment
At 1 April 2018
-
24,176
16,744
40,920
Depreciation charged in the year
6,317
5,621
9,470
21,408
At 31 March 2019
6,317
29,797
26,214
62,328
Carrying amount
At 31 March 2019
6,317
6,586
16,577
29,480
At 31 March 2018
7,451
10,802
13,016
31,269
MULBURY HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2019
- 19 -
12
Fixed asset investments
2019
2018
Notes
£
£
Investments in associates
13
42
-
Movements in fixed asset investments
Shares in group undertakings and participating interests
£
Cost or valuation
At 1 April 2018
-
Additions
42
At 31 March 2019
42
Carrying amount
At 31 March 2019
42
At 31 March 2018
-
13
Associates
Details of the company's associates at 31 March 2019 are as follows:
Name of undertaking
Registered
Nature of business
Class of
% Held
office
shares held
Direct
Indirect
Mulbury Estates Limited
England & Wales
Property development
Ordinary
42.00
0
14
Financial instruments
2019
2018
£
£
Carrying amount of financial assets
Debt instruments measured at amortised cost
10,826,281
7,731,759
Carrying amount of financial liabilities
Measured at amortised cost
11,249,066
9,039,399
MULBURY HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2019
- 20 -
15
Debtors
2019
2018
Amounts falling due within one year:
£
£
Trade debtors
8,498,930
5,884,861
Other debtors
2,529,826
1,992,147
Prepayments and accrued income
1,323,195
1,334,355
12,351,951
9,211,363
16
Creditors: amounts falling due within one year
2019
2018
£
£
Trade creditors
4,828,855
3,526,702
Corporation tax
45,797
32,140
Other taxation and social security
121,788
65,921
Other creditors
5,463,137
3,549,758
Accruals and deferred income
957,074
1,962,939
11,416,651
9,137,460
Included within other creditors are development loans totalling £3,810,438 (2018: £2,450,000) secured against land and property owned by the company.
17
Provisions for liabilities
2019
2018
Notes
£
£
Deferred tax liabilities
18
3,218
3,239
18
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2019
2018
Balances:
£
£
Accelerated capital allowances
3,218
3,239
MULBURY HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2019
18
Deferred taxation
(Continued)
- 21 -
2019
Movements in the year:
£
Liability at 1 April 2018
3,239
Credit to profit or loss
(21)
Liability at 31 March 2019
3,218
19
Retirement benefit schemes
2019
2018
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
66,510
64,852
The company operates a defined contribution pension scheme for all qualifying employees.
The assets of the scheme are held separately from those of the company in an independently administered fund.
20
Share capital
2019
2018
£
£
Ordinary share capital
Issued and fully paid
2 Ordinary shares of £1 each
2
2
21
Reserves
Profit and loss reserves
This reserve records retained earnings and accumulated losses.
22
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:
2019
2018
£
£
Within one year
95,193
74,971
Between two and five years
30,548
6,771
125,741
81,742
MULBURY HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2019
- 22 -
23
Related party transactions
By virtue of common shareholdings Mulbury Homes Strategic Land Limited, Mulbury Homes (Blossom Street) Limited,
Mulbury Homes (Castlefield) Limited,
Mulbury Homes (Goulden Street) Limited,
Portwood Developments Limited
,
Newbury Homes Limited
, Mulbury (Excelsior Works) Limited, Mulbury (Warrington) Limited, Mulbury Homes (Grappenhall) Limited, Mulbury Estates Limited, Mulbury Homes (Central) Limited and Mulbury Homes (Greg Street) Limited
are related parties.
The company received a management charge of £
67,500
(201
8
: £
270,000
) from Mulbury Homes
Strategic Land Limited
in the year.
At the year end, a balance of £
367,417
(201
8
: £
190,796
) was owed
to
Mulbury Homes Strategic Land Limited and included within other
creditors
.
At the year end, a balance of £
185
(201
8
: £
125,600
) was owed
to
Mulbury Homes
(Goulden Street)
Limited and included within other
creditors.
At the year end, a balance of £
1,073,180
(201
8
: £
987,199
) was owed from Mulbury Homes (Blossom Street) Limited and included within other debtors.
The company received a management charge of £
25,000
(201
8
: £
773,000
) from Mulbury Homes (
Blossom Street
) Limited in the year.
At the year end, a balance of £
374,801
(201
8
: £
505,331
) was owed
to
Mulbury Homes (
Castlefield
) Limited and included within other
creditors
.
The company received a management charge of £
NIL
(201
8
: £
519,000
) from Mulbury Homes (
Castlefield
) Limited in the year.
At the year end, a balance of £
20,722
(201
8
: £
NIL
) was owed
to
Mulbury Homes
(Greg Street)
Limited and included within other
creditors
.
At the year end, a balance of £
29,898
(201
8
: £
NIL
) was owed from Mulbury
Estates
Limited and included within other debtors.
At the year end, a balance of £
395,615
(201
8
: £
NIL
) was owed from Mulbury Homes (
Central
) Limited and included within other debtors.
MULBURY HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2019
23
Related party transactions
(Continued)
- 23 -
The company sold goods and services of £455,444 (2018: £1,165,285) to Portwood Developments Limited.
The company paid consultancy fees of £175,000 (2018: £150,000) to Portwood Developments Limited and £175,000 (2018: £46,200) to Newbury Homes Limited.
At the year end, a balance of £148,149 (2018: £740,719 debtor) was owed to Portwood Developments Limited and a balance of £333,426 (2018: £423,426) was owed from Newbury Homes Limited.
The company received a management charge of £200,000 (2018: £NIL) from Mulbury (Excelsior Works) Limited in the year.
At the year end, a balance of £172,943 (2018: £24,099) was owed from Mulbury (Excelsior Works) Limited and included within other debtors.
At the year end, a balance of £304,258 (2018: £31,602) was owed from Mulbury (Warrington) Limited and included within other debtors.
At the year end, a balance of £57,251 (2018: £15,186) was owed from Mulbury Homes (Grappenhall) Limited and included within other debtors.
The loans are interest free with no fixed date for repayment.
24
Ultimate controlling party
Throughout the current and previous year, the company was controlled by G J Mulligan and W M Bury by virtue of their holding of 50% each in the issued share capital of the company.
25
Directors' transactions
At the balance sheet date, W M Bury owed the company an amount of £96,510 (2018: £58,698). The loan was interest free and was repaid in full post year end.
At the balance sheet date, G J Mulligan owed the company an amount of £1,756 (2018: £59,730). The loan was interest free and was repaid in full post year end.
2019-03-31
2018-04-01
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