Company registration number 11240116 (England and Wales)
LIVERPOOL FOUNDATION HOMES LIMITED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
PAGES FOR FILING WITH REGISTRAR
LIVERPOOL FOUNDATION HOMES LIMITED
CONTENTS
Page
Balance sheet
1
Statement of changes in equity
2
Notes to the financial statements
3 - 7
LIVERPOOL FOUNDATION HOMES LIMITED
BALANCE SHEET
AS AT
31 MARCH 2023
31 March 2023
- 1 -
2023
2022
Notes
£
£
£
£
Fixed assets
Tangible assets
3
3,730,000
3,130,000
Current assets
Debtors
4
332,497
266,372
Creditors: amounts falling due within one year
5
(613,985)
(611,940)
Net current liabilities
(281,488)
(345,568)
Total assets less current liabilities
3,448,512
2,784,432
Creditors: amounts falling due after more than one year
6
(2,095,713)
(1,987,044)
Provisions for liabilities
(291,500)
(175,000)
Net assets
1,061,299
622,388
Capital and reserves
Called up share capital
1
1
Revaluation reserve
1,122,766
636,766
Other reserves
1,413,097
1,413,097
Profit and loss reserves
(1,474,565)
(1,427,476)
Total equity
1,061,299
622,388
The director of the company has elected not to include a copy of the profit and loss account within the financial statements.true
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 and signed by the director and authorised for issue on 19 December 2023
Mr A Buck
Director
Company registration number 11240116 (England and Wales)
LIVERPOOL FOUNDATION HOMES LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2023
- 2 -
Share capital
Revaluation reserve
Profit and loss reserves
Total
£
£
£
£
£
Balance at 1 April 2021
1
175,580
1,413,097
(1,335,557)
253,121
Year ended 31 March 2022:
Loss
-
-
-
(91,919)
(91,919)
Other comprehensive income:
Revaluation of tangible fixed assets
-
560,000
-
-
560,000
Tax relating to other comprehensive income
-
(98,814)
-
(98,814)
Total comprehensive income
-
461,186
-
(91,919)
369,267
Balance at 31 March 2022
1
636,766
1,413,097
(1,427,476)
622,388
Year ended 31 March 2023:
Loss
-
-
-
(47,089)
(47,089)
Other comprehensive income:
Revaluation of tangible fixed assets
-
600,000
-
-
600,000
Tax relating to other comprehensive income
-
(114,000)
-
(114,000)
Total comprehensive income
-
486,000
-
(47,089)
438,911
Balance at 31 March 2023
1
1,122,766
1,413,097
(1,474,565)
1,061,299
LIVERPOOL FOUNDATION HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2023
- 3 -
1
Accounting policies
Company information
Liverpool Foundation Homes Limited is a private company limited by shares incorporated in England and Wales. The registered office is Cunard Building, Water Street, Liverpool, L3 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 amounts 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 at fair value. The principal accounting policies adopted are set out below.
1.2
Going concern
In response to a decision taken by the shareholder it is the Directors intention to market the properties owned by LFH for sale to another housing provider, transferring the current tenancies terms and conditions and to close the company. The financial statements are prepared on a cessation basis which represents a true and fair view of the financial statements.true
Notwithstanding the loss for the year ended 31st March 2023, the Directors are satisfied that the Company has adequate resources having received confirmation of support of its parent entity, Liverpool City Council, for a period up to the date of liquidation.
1.3
Turnover
Income is recognised and measured in the financial statements at the fair value i.e. the point at which it is received or receivable. Rental income for properties under development or sale is recognised from the point of practical completion and letting.
1.4
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.
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.
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.
LIVERPOOL FOUNDATION HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 4 -
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.
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 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.
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 payments 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. Amounts 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.
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.
LIVERPOOL FOUNDATION HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
1
Accounting policies
(Continued)
- 5 -
1.9
Provisions
Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.
1.10
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
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2023
2022
Number
Number
Total
3
Tangible fixed assets
Land and buildings
£
Cost or valuation
At 1 April 2022
3,130,000
Revaluation
600,000
At 31 March 2023
3,730,000
Depreciation and impairment
At 1 April 2022 and 31 March 2023
Carrying amount
At 31 March 2023
3,730,000
At 31 March 2022
3,130,000
LIVERPOOL FOUNDATION HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
3
Tangible fixed assets
(Continued)
- 6 -
Land and buildings with a carrying amount of £3,730,000 were valued in December 2022 by SK Real Estate (Liverpool) Limited, on the basis of market value. The valuation conforms to International Valuation Standards and was based on recent market transactions on arm's length terms for similar properties. The director are of the opinion that there has been no material movement between the date of valuation and the year end.
If revalued assets were stated on an historical cost basis rather than a fair value basis, the total amounts included would have been as follows:
2023
2022
£
£
Cost
2,353,235
2,353,235
4
Debtors
2023
2022
Amounts falling due within one year:
£
£
Trade debtors
12,762
9,333
Other debtors
319,735
257,039
332,497
266,372
5
Creditors: amounts falling due within one year
2023
2022
£
£
Trade creditors
404,496
404,495
Other creditors
209,489
207,445
613,985
611,940
6
Creditors: amounts falling due after more than one year
2023
2022
£
£
Other creditors
2,095,713
1,987,044
Included in other creditors are loan balances of £2,095,713 (2022: £1,987,044) due to the parent undertaking. These loans currently have no set repayment date. Repayments will be made on the loans as and when the properties owned by Liverpool Foundation Homes Limited are sold. Interest is charged on the loans at 1.53% per month. The facilities are secured against the properties owned by the company.
LIVERPOOL FOUNDATION HOMES LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2023
- 7 -
7
Audit report information
As the income statement has been omitted from the filing copy of the financial statements, the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006:
The auditor's report was unqualified.
We draw attention to note 7 within the financial statements which explains that the directors intend to liquidate the company and therefore do not consider it to be appropriate to adopt the going concern basis of accounting in preparing the financial statements. Accordingly the financial statements have been prepared on a basis other than going concern as described in the directors report. Our opinion is not modified in respect of this matter.
Senior Statutory Auditor:
Jean Ellis BA FCA CTA
Statutory Auditor:
DSG
Date of audit report:
19 December 2023
8
Events after the reporting date
In October 2022 the voluntary decision was made by Liverpool City Council to liquidate the business once all of the properties held have been sold. Going forward the properties held will be marketed for sale and trading activities will thus cease. As a result these financial statements have been prepared on a cessation basis.
9
Related party transactions
Transactions with related parties
During the year the company entered into the following transactions with related parties:
Other information
Included within creditors falling due greater than one year is a balance of £2,095,713 (2022: £1,987,044) which is due to the parent company.