Company registration number 10222968 (England and Wales)
PENANS RENEWABLE ENERGY LIMITED
UNAUDITED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
PAGES FOR FILING WITH REGISTRAR
PENANS RENEWABLE ENERGY LIMITED
COMPANY INFORMATION
Directors
D M Reid
N A Forster
Secretary
S Cruickshank
Company number
10222968
Registered office
15 Golden Square
London
United Kingdom
W1F 9JG
Accountants
FLB Accountants LLP
250 Wharfedale Road
Winnersh Triangle
Wokingham
Berkshire
RG41 5TP
PENANS RENEWABLE ENERGY LIMITED
CONTENTS
Page
Statement of financial position
1
Notes to the financial statements
2 - 7
PENANS RENEWABLE ENERGY LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT
31 MARCH 2022
31 March 2022
- 1 -
2022
2021
Notes
£
£
£
£
Fixed assets
Tangible assets
4
3,120,513
3,120,513
Current assets
Debtors
5
40,268
33,105
Creditors: amounts falling due within one year
6
(3,417,233)
(3,367,108)
Net current liabilities
(3,376,965)
(3,334,003)
Net liabilities
(256,452)
(213,490)
Capital and reserves
Called up share capital
7
1
1
Profit and loss reserves
8
(256,453)
(213,491)
Total equity
(256,452)
(213,490)
The directors of the company have elected not to include a copy of the income statement within the financial statements.
true
For the financial year ended 31 March 2022 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.
The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.
T
he members have not required the company to obtain an audit of its financial statements for the year in question in accordance with section 476
.
These financial statements have been prepared and delivered 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 16 December 2022 and are signed on its behalf by:
N A Forster
Director
Company Registration No. 10222968
PENANS RENEWABLE ENERGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
- 2 -
1
Accounting policies
Company information
Penans Renewable Energy Limited is a
private
company
limited by shares
incorporated in
England and Wales
.
The registered office is
15 Golden Square, London, United Kingdom, W1F 9JG.
The Company’s principal activity is the generation of gas and electricity from renewable energy sources which is achieved through the construction and operation of an anaerobic digestion plant.
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, 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.
1.2
Going concern
The Company has a substantial loan from its parent entity, in order to invest in renewable energy assets. The Company is dependent on financial support from its parent entity, which is expected but not guaranteed.
As a result of the above and having considered the Company's cash requirements for the period from the date of these accounts, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. Accordingly, the going concern basis continues to be adopted in preparing the financial statements.
1.3
Tangible fixed assets
Tangible fixed assets are stated at cost net of depreciation and any provision for impairment. 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.
Tangible
fixed assets
compromise anaerobic digestion assets under construction.
Assets in the course of construction are not depreciated.
Depreciation commences on the
date that the asset is
brought into use
and will be
charged so as to allocate the cost of assets less their residual value over their estimated
useful lives
,
using the straight-line method.
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.
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
.
1.4
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.
PENANS RENEWABLE ENERGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
1
Accounting policies
(Continued)
- 3 -
The commencement of capitalisation begins when both finance costs and expenditures for the asset are
being incurred and activities that are necessary to get the asset ready for use are in progress.
Capitalisation ceases when substantially all the activities that are necessary to get the asset ready for use
are complete, or where construction is suspended for a significant period of time.
1.5
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.
1.6
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.
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 statement of financial position when the company becomes party to the contractual provisions of the instrument.
Financial assets and liabilities are offset
, with
the net amounts presented in the financial statements
,
when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.
Basic financial assets
Basic financial assets, which include
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.
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.
1.8
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.
1.9
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
PENANS RENEWABLE ENERGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
1
Accounting policies
(Continued)
- 4 -
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the
income statement
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
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
income statement
, 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.
1.10
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.
1.11
Non-derivative financial liabilities with fixed or determinable repayments that are not quoted in an active market are classified as loans. Loans are initially recognised at fair value of the consideration received plus directly related transaction costs. They are subsequently measured at amortised cost using the effective interest method. Arrangement fees and interest payable on financial liabilities that are classified as loans, are charged to the profit and loss account.
The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating the interest payable over the expected life of the liability. The effective interest rate is the rate that exactly discounts estimated future cashflows to the instrument's initial carrying amount. Calculation of the effective interest rate takes into account fees payable, that are an integral part of the instrument yield and transaction costs. All contractual terms of a financial instrument are considered when estimating future cash flows.
A financial liability is removed from the balance sheet when the obligation is discharged, or cancelled, or expires.
PENANS RENEWABLE ENERGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
- 5 -
2
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.
3
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2022
2021
Number
Number
Total
4
Tangible fixed assets
Land and buildings
£
Cost
At 1 April 2021 and 31 March 2022
3,120,513
Depreciation and impairment
At 1 April 2021 and 31 March 2022
Carrying amount
At 31 March 2022
3,120,513
At 31 March 2021
3,120,513
Borrowing costs amounting to £776,349
(2020 - £776,349)
have been included in the cost of tangible fixed assets and is comprised of loan interest only.
5
Debtors
2022
2021
Amounts falling due within one year:
£
£
Amounts owed by group undertakings
28,261
17,502
Other debtors
12,007
15,603
40,268
33,105
PENANS RENEWABLE ENERGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
- 6 -
6
Creditors: amounts falling due within one year
2022
2021
£
£
Trade creditors
15,004
682
Amounts owed to group undertakings
3,394,920
3,354,418
Other creditors
7,309
12,008
3,417,233
3,367,108
The Company's immediate parent, IQB Development MidCo Limited, provided a loan to the Company on 28 April 2016. Interest is charged at 8.7% + UK base rate per annum. The loan is unsecured and repayable on demand.
During the year, all interest charges on such related party loans have been waived.
7
Called up share capital
2022
2021
2022
2021
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary of £1 each
1
1
1
1
8
Profit and loss reserves
2022
2021
£
£
At the beginning of the year
(213,491)
(166,638)
Loss for the year
(42,962)
(46,853)
At the end of the year
(256,453)
(213,491)
The
p
rofit and
l
oss
a
ccount represents the cumulative profits or losses, net of dividends paid and other adjustments
.
9
Financial commitments, guarantees and contingent liabilities
The Company has an obligation to restore the operational site which houses the anaerobic digestion plant
at the end of the lease agreement (25 years from the term commencement date). No provision is included
in the accounts as the amount cannot be measured reliably.
PENANS RENEWABLE ENERGY LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
- 7 -
10
Operating lease commitments
Lessee
At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, as follows:
2022
2021
£
£
40,000
20,000
The comparative commitment has been corrected to show the committed costs at each reporting date, as specified by the lease.
11
Parent company
As at year end, IQB Development MidCo Limited, a company registered in England and Wales, is the immediate controlling parent company. The ultimate parent
entity
is Ingenious Qila Biogas LLP, which is registered in England and Wales.
IQB Development Mid
C
o Limited's registered office is 15 Golden Square, London, England, W1F 9JG.
Ingenious Qila Biogas LLP's registered office is 15 Golden Square, London, England, W1F 9JG.