Company Registration No. 10200615 (England and Wales)
ASPECT (EASTLEIGH) LIMITED
(A COMPANY LIMITED BY GUARANTEE)
FINANCIAL STATEMENTS
FOR THE YEAR ENDED
31 MARCH 2021
3 Acorn Business Centre
Northarbour Road
Cosham
Portsmouth
Hampshire
United Kingdom
PO6 3TH
ASPECT (EASTLEIGH) LIMITED
(A COMPANY LIMITED BY GUARANTEE)
CONTENTS
Page
Company information
1
Directors' report
2 - 3
Independent auditor's report
4 - 7
Statement of income and retained earnings
8
Balance sheet
9
Notes to the financial statements
10 - 15
ASPECT (EASTLEIGH) LIMITED
(A COMPANY LIMITED BY GUARANTEE)
COMPANY INFORMATION
- 1 -
Directors
Ms. S King
Mr. I Corben
Mr. A Trayer
Secretary
Tiaa Limited
Company number
10200615
Manager for administration and
Peter Hammond
company secretarial matters
c/o TIAA Limited
Artillery House
Fort Fareham
Newgate Lane
Fareham
PO14 1AH
Registered office
Artillery House
Fort Fareham
Newgate Lane
Fareham
PO14 1AH
Auditor
TC Group
3 Acorn Business Centre
Northarbour Road
Cosham
Portsmouth
Hampshire
United Kingdom
PO6 3TH
ASPECT (EASTLEIGH) LIMITED
(A COMPANY LIMITED BY GUARANTEE)
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2021
- 2 -
The directors present their annual report and financial statements for the year ended 31 March 2021.
Principal activities
The principal activities of the company are that of a management company to number of housing developments, and that of a landlord in respect of a portfolio of residential properties. The primary aim of these developments and properties being to improve the quality of lives of the borough of Eastleigh.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Ms. S King
Mr. I Corben
Mr. A Trayer
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 surplus or deficit 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.
Auditor
The auditor, TC Group, is deemed to be reappointed under section 487(2) of the Companies Act 2006.
ASPECT (EASTLEIGH) LIMITED
(A COMPANY LIMITED BY GUARANTEE)
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2021
- 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.
This report has been prepared in accordance with the provisions applicable to companies entitled to the small companies exemption.
On behalf of the board
Ms. S King
Director
15 December 2021
ASPECT (EASTLEIGH) LIMITED
(A COMPANY LIMITED BY GUARANTEE)
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF ASPECT (EASTLEIGH) LIMITED
- 4 -
Opinion
We have audited the financial statements of Aspect (Eastleigh) Limited (the 'company') for the year ended 31 March 2021 which comprise the statement of income and retained earnings, the balance sheet and notes to the financial statements, including 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 2021 and of its deficit 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
In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. 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. 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 course of 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 this gives rise to a material misstatement in the financial statements themselves. 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.
ASPECT (EASTLEIGH) LIMITED
(A COMPANY LIMITED BY GUARANTEE)
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ASPECT (EASTLEIGH) LIMITED
- 5 -
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 directors'
r
eport for the financial year for which the financial statements are prepared is consistent with the financial statements
; and
-
the directors' report has been prepared in accordance with applicable legal requirements.
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 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
remuneration specified by law are not made; or
-
we have not received all the information and explanations we require for our audit; or
-
the directors were not entitled to prepare the financial statements in accordance with the small companies regime and take advantage of the small companies' exemption in preparing the directors' report and take advantage of the small companies exemption from the requirement to prepare a strategic report.
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
.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
Extent to which the audit was considered capable of detecting irregularities, including fraud
The objectives of our audit, in respect to fraud, are: to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses; and to respond appropriately to fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the entity and its management.
ASPECT (EASTLEIGH) LIMITED
(A COMPANY LIMITED BY GUARANTEE)
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ASPECT (EASTLEIGH) LIMITED
- 6 -
Our approach was as follows:
-
We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our general commercial and sector experience, and through discussion with the directors and other management (as required by auditing standards), and discussed with the directors and other management the policies and procedures regarding compliance with laws and regulations;
-
We considered the legal and regulatory frameworks directly applicable to the financial statements reporting framework (FRS 102 and the Companies Act 2006) and the relevant tax compliance regulations in the UK;
-
We considered the nature of the industry, the control environment and business performance;
-
We communicated identified laws and regulations throughout our team and remained alert to any indications of non-compliance throughout the audit;
-
We considered the procedures and controls that the company has established to address risks identified, or that otherwise prevent, deter and detect fraud; and how senior management monitors those programmes and controls.
Based on this understanding we designed our audit procedures to identify non-compliance with such laws and regulations. Where the risk was considered to be higher, we performed audit procedures to address each identified fraud risk. These procedures included: testing manual journals; reviewing the financial statement disclosures and testing to supporting documentation; performing analytical procedures; and enquiring of management, and were designed to provide reasonable assurance that the financial statements were free from fraud or error.
Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.
A further description of our responsibilities is available on the Financial Reporting Council’s website at:
https://www.frc.org.uk/Our-Work/Audit/Audit-and-assurance/Standards-and-guidance/Standards-and-guidance-for-auditors/Auditors-responsibilities-for-audit/Description-of-auditors-responsibilities-for-audit.aspx
. This description forms part of our auditor’s report.
ASPECT (EASTLEIGH) LIMITED
(A COMPANY LIMITED BY GUARANTEE)
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF ASPECT (EASTLEIGH) LIMITED
- 7 -
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.
James Blake FCA (Senior Statutory Auditor)
For and on behalf of TC Group
Statutory Auditor
15 December 2021
Office: Portsmouth
ASPECT (EASTLEIGH) LIMITED
(A COMPANY LIMITED BY GUARANTEE)
STATEMENT OF INCOME AND RETAINED EARNINGS
FOR THE YEAR ENDED 31 MARCH 2021
- 8 -
2021
2020
£
£
Rent receivable
55,916
25,925
Cost of sales
(9,764)
(7,360)
Gross surplus
46,152
18,565
Administrative expenses
(91,054)
(110,651)
Deficit before taxation
(44,902)
(92,086)
Tax on deficit
Deficit for the financial year
(44,902)
(92,086)
Retained earnings brought forward as previously reported
(107,773)
(15,687)
Retained earnings carried forward
(152,675)
(107,773)
The notes on pages 10 to 15 form part of these financial statements
ASPECT (EASTLEIGH) LIMITED
(A COMPANY LIMITED BY GUARANTEE)
BALANCE SHEET
AS AT
31 MARCH 2021
31 March 2021
- 9 -
2021
2020
Notes
£
£
£
£
Fixed assets
Investments
4
32,832,165
28,683,111
Current assets
Debtors
5
13,887
Creditors: amounts falling due within one year
6
(155,435)
(124,420)
Net current liabilities
(155,435)
(110,533)
Total assets less current liabilities
32,676,730
28,572,578
Creditors: amounts falling due after more than one year
7
(32,829,405)
(28,680,351)
Net liabilities
(152,675)
(107,773)
Reserves
Income and expenditure account
(152,675)
(107,773)
Members' funds
(152,675)
(107,773)
These financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.
The financial statements were approved by the board of directors and authorised for issue on 15 December 2021 and are signed on its behalf by:
Ms. S King
Director
Company Registration No. 10200615
The notes on pages 10 to 15 form part of these financial statements
ASPECT (EASTLEIGH) LIMITED
(A COMPANY LIMITED BY GUARANTEE)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2021
- 10 -
1
Accounting policies
Company information
Aspect (Eastleigh) Limited is a
private
company
limited by guarantee
incorporated in
England and Wales
.
The registered office is
Artillery House, Fort Fareham, Newgate Lane, Fareham, PO14 1AH.
1.1
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 as applicable to companies subject to the small companies regime. 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 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. The principal accounting policies adopted are set out below.
1.2
Going concern
These financial statements are prepared on the going concern basis. The directors have a reasonable expectation that the company will continue in operational existence for the foreseeable future with the ongoing support of the related parties.
1.3
Income and expenditure
Income and expenses are included in the financial statements as they become receivable or due.
Turnover represents rental incomes receivable by the company in its capacity as landlord to a portfolio of residential properties. Rental income is recognised on a straight line basis over the term of the tenancy agreements and is measured at the fair value of the consideration receivable.
Expenses include VAT where applicable as the company cannot reclaim it.
1.4
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
surplus
or
deficit
.
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
.
ASPECT (EASTLEIGH) LIMITED
(A COMPANY LIMITED BY GUARANTEE)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2021
1
Accounting policies
(Continued)
- 11 -
1.5
Borrowing costs related to fixed assets
Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale.
1.6
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.
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
surplus
or
deficit
, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
1.7
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.
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.
ASPECT (EASTLEIGH) LIMITED
(A COMPANY LIMITED BY GUARANTEE)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2021
1
Accounting policies
(Continued)
- 12 -
Basic financial liabilities
Basic financial liabilities, including
creditors and l
oans from
related parties
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.
1.8
Taxation
The tax currently payable is based on taxable profit for the year
of the company and of its participation as a member in the limited liability partnerships held in investments
. 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.
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. 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
Employees
The company had no employees during the current or prior period.
3
Interest payable and similar expenses
2021
2020
£
£
Interest on financial liabilities measured at amortised cost:
Notional interest payable on loans from related parties (see note 6)
1,959,120
1,589,126
Finance cost on inception of loan instrument (see note 6)
189,934
464,707
Capitalisation of borrowing costs (see note 4)
(2,149,054)
(2,053,833)
-
ASPECT (EASTLEIGH) LIMITED
(A COMPANY LIMITED BY GUARANTEE)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2021
- 13 -
4
Fixed asset investments
2021
2020
£
£
Investments
2,760
2,760
Loans
32,829,405
28,680,351
32,832,165
28,683,111
Investments represent the cost of the company's interests in UK registered limited liability partnerships. The company has entered into a number of joint venture arrangements for the development of residential and social housing properties, which are conducted through the following special purpose vehicles:
-
Woodside Avenue Developments LLP and Woodside Avenue Homes LLP, in relation to the property development at Leah Gardens, Eastleigh, Hampshire;
-
Stoneham Park Developments LLP, in relation to the property development at North Stoneham Park, Eastleigh, Hampshire; and
-
Pembers LLP, in relation to the property development at Pembers Farm, Fair Oak, Eastleigh, Hampshire.
Movements in fixed asset investments
Participating interests in UK Limited Liability Partnerships
Loans with participating interests
Total
£
£
£
Cost or valuation
At 1 April 2020
2,760
28,680,351
28,683,111
Additions
-
4,149,054
4,149,054
At 31 March 2021
2,760
32,829,405
32,832,165
Carrying amount
At 31 March 2021
2,760
32,829,405
32,832,165
At 31 March 2020
2,760
28,680,351
28,683,111
ASPECT (EASTLEIGH) LIMITED
(A COMPANY LIMITED BY GUARANTEE)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2021
4
Fixed asset investments
(Continued)
- 14 -
Loan with Pembers LLP
During the period the company provided a further drawdown on the loan to Pembers LLP amounting to £2 million for the specific purpose of funding the property development within the joint venture special purpose vehicle that is Pembers LLP. The loan is interest free and repayable from the proceeds of the completed property development. Under the Pembers LLP agreement the company is entitled to a share of the profits of the completed property development. Whilst there is no return to the company receivable on the loan instrument, the returns to the company from its interest in Pembers LLP are variable depending on the outcome of the property development and hence the directors have treated the loan to Pembers LLP as part of the cost of the company's investment in Pembers LLP.
Capitalised borrowing costs
To fund the £2 million loan to Pembers LLP the company has borrowed an equivalent principal amount from a related party. The loan with the related party specifies that it is for the specific purpose of funding the Pembers LLP joint venture special purpose vehicle for funding the property development at Pembers Farm. The directors having regard to section 25 of FRS 102 consider that the company's investment in the property development, meets the definition of a qualifying asset, given that it will necessarily take a substantial period of time to get the property development in Pembers LLP ready for its intended use or sale, and therefore equivalently the company's investment in Pembers LLP ready for its realisation. Accordingly the company has capitalised those borrowing costs incurred in the period.
Loans with participating interests
The Loans with participating interests are recorded at cost less impairment. The directors have considered the expected outcomes of the property development and have concluded that no provision for impairment is necessary at 31st March 2021.
5
Debtors
2021
2020
Amounts falling due within one year:
£
£
Other debtors
13,887
6
Creditors: amounts falling due within one year
2021
2020
£
£
Deferred income
3,474
Other creditors
151,961
124,420
155,435
124,420
Entities related to the company have paid for certain expenditure on behalf of the company. Other creditors relate to balances owed to related parties.
ASPECT (EASTLEIGH) LIMITED
(A COMPANY LIMITED BY GUARANTEE)
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2021
- 15 -
7
Creditors: amounts falling due after more than one year
2021
2020
£
£
Other creditors
32,829,405
28,680,351
During the year the company has been provided with a further £2 million of funding under a formal loan agreement, by a related party, for the specific purpose of funding one of its property developments, enacted through one of its special purpose vehicle joint ventures. The aggregate principal value of the loans at 31st March 2021 was £24.5 million (2020 - £22.5 million). The related party is not a member of the company, but has significant influence over the company. The loan incurs an actual rate of interest of 13% per annum and repayment is due on the earlier of 12th October 2023 or the date the property development is completed and the company's investment is realised. Actual interest at 13% accrued on the loan during the year totalling £3,103,795 (2020 - £2,621,667).
The arrangement constitutes a financial liability in accordance with section 11 of FRS102. Under the guidelines of FRS 102, the directors estimate that the rate of interest on an equivalent market loan would be 6.5%. The directors have discounted the expected cash flows and calculated the fair value of the additional financial liability of £2 million at inception to be £2,189,934. Because the related party is not a member of the company the balance at inception of £189,934 has not been recognised as a deemed distribution, but instead is considered to be a financial cost of entering the loan instrument.
During the period notional interest of £1,959,120 (2020 - £1,589,126) has been recognised and accrued to the balance of the financial liability.
8
Members' liability
The company is limited by guarantee, not having a share capital and consequently the liability of members is limited, subject to an undertaking by each member to contribute to the net assets or liabilities of the company on winding up such amounts as may be required not exceeding £1.
9
Related party transactions
The company is party to a tenancy agreement with a related party, under which it is contracted to manage 6 properties as landlord on behalf of the related party. No consideration was paid in respect of entering the tenancy agreements.
The directors of the company also hold positions of influence at Eastleigh Borough Council.
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2020-03-31
10200615
core:Non-currentFinancialInstruments
core:AfterOneYear
2021-03-31
10200615
core:Non-currentFinancialInstruments
core:AfterOneYear
2020-03-31
10200615
core:Non-currentFinancialInstruments
2021-03-31
10200615
core:Non-currentFinancialInstruments
2020-03-31
10200615
core:WithinOneYear
2021-03-31
10200615
core:WithinOneYear
2020-03-31
10200615
core:CurrentFinancialInstruments
2021-03-31
10200615
core:CurrentFinancialInstruments
2020-03-31
10200615
bus:CompanyLimitedByGuarantee
2020-04-01
2021-03-31
10200615
bus:FRS102
2020-04-01
2021-03-31
10200615
bus:Audited
2020-04-01
2021-03-31
10200615
bus:FullAccounts
2020-04-01
2021-03-31
xbrli:pure
xbrli:shares
iso4217:GBP