Company registration number 01590762 (England and Wales)
PALMGLEN LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
PALMGLEN LIMITED
COMPANY INFORMATION
Directors
B Bourne
M Watt
S Xuan Bui
F Nash
Secretary
A Davies
Company number
01590762
Registered office
73 Cornhill
London
EC3V 3QQ
Auditor
Gerald Edelman LLP
73 Cornhill
London
EC3V 3QQ
PALMGLEN LIMITED
CONTENTS
Page
Strategic report
1 - 2
Directors' report
3 - 4
Independent auditor's report
5 - 7
Profit and loss account
8
Statement of comprehensive income
9
Balance sheet
10
Statement of changes in equity
11
Statement of cash flows
12
Notes to the financial statements
13 - 24
PALMGLEN LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2022
- 1 -
The directors present the strategic report for the year ended 31 March 2022.
Fair review of the business
The company has reported a significant rise in turnover
and a return to profit during the year under review following the dramatic impact of Covid-19 on the business in the previous financial year.
The directors
continue to monitor any further
developments relating to
Covid-19. In the light of the strong return to trading in the year under review following the lifting of substantial Covid-19 related restrictions in the early year, the directors are confident that 2022/23 will see a sustained level of profit on the proviso there are no further enforced lockdowns or other such onerous restrictions.
Principal risks and uncertainties
The principal risks and uncertainties that could affect the company's business are summarised below:
Economic
climate
The company is competing for a share of the disposable income of its target consumers
and is exposed to the risks of the current economic climate; hence
this could lower the
company's
revenues and operating results in the future.
Regulatory changes
The company operates in a highly regulated sector where government legislation impacts the business model. The business could be adversely affected by significant changes in legislation. We carefully monitor legislative developments and review sales trends and consumer habits to gauge their impact on our business. We continue to update our knowledge on changing regulations through training, completion of qualifications and communication with third party specialists.
Seasonality and weather
The number of admissions in the company's venue is considerably increased during holiday periods and over bank holiday periods. The company's revenues can also be adversely impacted by extremes of weather conditions which could deter consumers from visiting the venue. Current planning assumes average seasonal weather conditions.
High proportion of fixed overheads and variable revenues
A significant proportion of the company's cost base remains constant notwithstanding changes to the level of revenues. Therefore, any significant changes in the level of the company's revenues could significantly affect the level of profits and cash flows. Simplifying and controlling the fixed overhead costs remains an area of focus.
Health and safety
Health and safety are taken very seriously by the company. The risk of non-compliance with health and safety legislation
is minimised through comprehensive training, review and development of policies and procedures to maintain standards.
Management
have
also address
ed
and
review
any g
overnment recommendations
and guidance
resulting from Covid-19.
Taxation
The company is exposed to financial risks from increases in tax rates and changes to the basis of taxation including corporation tax and VAT. Controls include regular monitoring of legislative proposals, engagement of experienced executives and the use of experienced sector-specific professional advisers to mitigate the impact of changes.
Financing
See Financial instruments.
Key performance indicators
The key performance indicators for the company are admission and income levels, gross profit margins
above 55%
and EBITDA margin
in excess of
15%.
The directors consider that the company operates acceptable key performance indicators relevant to the nature of the business, with a gross profit margin of
69
% (20
21
:
65
%) and EBITDA
margin
of
47%
(20
21
:
18.1%
) having been achieved this year.
PALMGLEN LIMITED
STRATEGIC REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
- 2 -
Financial instruments
The company's principal financial instruments comprise bank balances, trade creditors and treasury movements with its parent undertaking. The main purpose of these instruments is to manage funds for the company's operations and to finance the company's operations. The company's approach to managing risks applicable to the financial instruments concerned is shown below.
Price risk
Price risk is managed by regularly negotiating prices with suppliers.
Interest rate risk
The company now finances its operations through its own profitability and reserves. The parent undertaking had an interest rate protection agreement in respect of its bank borrowing, using an interest rate swap to generate the desired interest profile and thereby manage its exposure to interest rate fluctuations. The parent company recharges this interest at cost to Palmglen Limited, being the trading entity.
Liquidity risk
The company seeks to manage financial risk by ensuring sufficient liquidity is available to meet foreseeable needs and to invest cash assets safely and profitably. This is achieved through improved profitability which is recognised in the form of cash. The company policy throughout the year has been to ensure continuity of funding.
B Bourne
Director
15 December 2022
PALMGLEN LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2022
- 3 -
The directors present their annual report and financial statements for the year ended 31 March 2022.
Principal activities
The principal activity of the company in the year under review was that of a jazz club, bar and restaurant.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
S Greene
(Resigned 4 August 2022)
B Bourne
M Bucks
(Resigned 30 April 2021)
M Watt
S Xuan Bui
F Nash
Results and dividends
The results for the year are set out on page 8.
Ordinary dividends were paid amounting to £500,000 (2021: £nil). The directors do not recommend payment of a final dividend.
Auditor
The auditor, Gerald Edelman 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.
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.
PALMGLEN LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
- 4 -
Going Concern
Having reviewed the company's financial forecasts and expected future cash flows, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future
. The company continues to hold good cash reserves to shelter against any further anticipated impact of the pandemic and
to continue operationally
.
Thus, the going concern basis has been adopted in preparing the financial statements for the year ended 31 March
2022
.
On behalf of the board
B Bourne
Director
15 December 2022
PALMGLEN LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF PALMGLEN LIMITED
- 5 -
Opinion
We have audited the financial statements of Palmglen Limited (the 'company') for the year ended 31 March 2022 which comprise the profit and loss account, the statement of comprehensive income, the balance sheet, the statement of changes in equity, the statement of cash flows 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 Financial Reporting Standard 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 2022 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
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.
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.
PALMGLEN LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF PALMGLEN LIMITED
- 6 -
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 or the directors'
r
eport
. We have nothing to report in respect of the following matters in relation to which 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.
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. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below
.
Our audit procedures were primarily directed towards testing the accounting systems in operation upon which we have based our assessment of the financial statements for the year ended 31 March 2022.
We planned our audit so that we have a reasonable expectation of detecting material misstatements in the financial statements resulting from irregularities, fraud or non-compliance with law or regulations.
Extent to which the audit was considered capable of detecting irregularities, including fraud
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, our procedures included the following:
-
The engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations
.
-
Enquiring of management of whether they are aware of any non-compliance with laws and regulations.
-
Enquiring of management whether they have knowledge of any actual, suspected or alleged fraud.
-
Enquiring of management their internal controls established to mitigate risk related to fraud or non-compliance with laws and regulations.
-
Discussions amongst the engagement team on how and where fraud might occur in the financial statements and any potential indicators of fraud. As part of this discussion, we identified potential for fraud in the following areas; posting of unusual journals and management override.
-
Obtaining understanding of the legal and regulatory framework the company operates in focusing on those laws and regulations that had a direct effect on the financial statements or that had a fundamental effect on the operations. The key laws and regulations we considered in this context included UK Companies Act 2006, tax legislation, employment, food hygiene, and health and safety.
PALMGLEN LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF PALMGLEN LIMITED
- 7 -
Audit response to risks identified
To address the risk of fraud through management bias and override of controls, we:
-
Performed analytical procedures to identify any unusual or unexpected relationships
.
-
Auditing the risk of management override of controls, including through testing journal entries for appropriateness
.
-
Assessed whether judgements and assumptions made in determining the accounting estimates set out in note
2
were indicative of potential bias
.
-
Investigated the rationale behind significant or unusual transactions.
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but are not limited to:
-
Agreeing financial statements disclosures to underlying supporting documentation
.
-
Reviewing minutes of meetings of those charged with governance.
-
Enquiring of management as to actual and potential litigation claims.
-
Reviewing correspondence with HMRC.
The test nature and other inherent limitations of an audit, together with the inherent limitations of any accounting and internal control system, mean that there is an unavoidable risk that even some material misstatements in respect of irregularities may remain undiscovered even though the audit is properly planned and performed in accordance with ISAs (UK). Furthermore, the more removed that laws and regulations are from financial transactions, the less likely that we would become aware of non-compliance.
Our examination should therefore not be relied upon to disclose all such material misstatements or frauds, errors or instances of non-compliance that might exist. The responsibility for safeguarding the assets of the company and for the prevention and detection of fraud, error and non-compliance with law or regulations rests with the director
s
.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
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.
Howard Woolf FCA (Senior Statutory Auditor)
For and on behalf of Gerald Edelman LLP
19 December 2022
Chartered Accountants
Statutory Auditor
73 Cornhill
London
EC3V 3QQ
PALMGLEN LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 MARCH 2022
- 8 -
2022
2021
Notes
£
£
Turnover
3
10,459,469
1,401,793
Cost of sales
(3,231,551)
(484,491)
Gross profit
7,227,918
917,302
Administrative expenses
(4,578,104)
(3,036,113)
Other operating income
3
1,971,641
2,064,087
Operating profit/(loss)
5
4,621,455
(54,724)
Interest payable and similar expenses
6
(5,180)
(17,603)
Profit/(loss) before taxation
4,616,275
(72,327)
Tax on profit/(loss)
9
(916,183)
18,216
Profit/(loss) for the financial year
3,700,092
(54,111)
The profit and loss account has been prepared on the basis that all operations are continuing operations.
PALMGLEN LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2022
- 9 -
2022
2021
£
£
Profit/(loss) for the year
3,700,092
(54,111)
Other comprehensive income
-
-
Total comprehensive income for the year
3,700,092
(54,111)
PALMGLEN LIMITED
BALANCE SHEET
AS AT
31 MARCH 2022
31 March 2022
- 10 -
2022
2021
Notes
£
£
£
£
Fixed assets
Tangible assets
10
1,786,835
2,122,835
Current assets
Stocks
11
96,155
82,981
Debtors
12
2,478,758
1,586,133
Cash at bank and in hand
6,382,465
2,900,193
8,957,378
4,569,307
Creditors: amounts falling due within one year
13
(3,941,760)
(3,027,441)
Net current assets
5,015,618
1,541,866
Total assets less current liabilities
6,802,453
3,664,701
Creditors: amounts falling due after more than one year
14
(46,808)
Provisions for liabilities
Deferred tax liability
16
35,263
50,795
(35,263)
(50,795)
Net assets
6,767,190
3,567,098
Capital and reserves
Called up share capital
17
548,024
548,024
Revaluation reserve
1,463,561
1,626,179
Profit and loss reserves
4,755,605
1,392,895
Total equity
6,767,190
3,567,098
The financial statements were approved by the board of directors and authorised for issue on 15 December 2022 and are signed on its behalf by:
B Bourne
Director
Company Registration No. 01590762
PALMGLEN LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2022
- 11 -
Share capital
Revaluation reserve
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 April 2020
548,024
1,788,797
1,284,388
3,621,209
Year ended 31 March 2021:
Loss and total comprehensive income for the year
-
-
(54,111)
(54,111)
Transfers
-
(162,618)
162,618
-
Balance at 31 March 2021
548,024
1,626,179
1,392,895
3,567,098
Year ended 31 March 2022:
Profit and total comprehensive income for the year
-
-
3,700,092
3,700,092
Dividends
8
-
-
(500,000)
(500,000)
Transfers
-
(162,618)
162,618
-
Balance at 31 March 2022
548,024
1,463,561
4,755,605
6,767,190
PALMGLEN LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2022
- 12 -
2022
2021
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
24
4,455,452
658,711
Interest paid
(5,180)
(17,603)
Income taxes paid
(418,000)
(206,332)
Net cash inflow from operating activities
4,032,272
434,776
Investing activities
Purchase of tangible fixed assets
(4,624)
Net cash used in investing activities
-
(4,624)
Financing activities
Proceeds of new bank loans
50,000
Repayment of bank loans
(50,000)
-
Dividends paid
(500,000)
Net cash (used in)/generated from financing activities
(550,000)
50,000
Net increase in cash and cash equivalents
3,482,272
480,152
Cash and cash equivalents at beginning of year
2,900,193
2,420,041
Cash and cash equivalents at end of year
6,382,465
2,900,193
PALMGLEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2022
- 13 -
1
Accounting policies
Company information
Palmglen Limited is a
private
company
limited by shares
incorporated in
England and Wales
.
The registered office is
73 Cornhill, London, EC3V 3QQ. The trading address is 47 Frith Street, Soho, London, W1D 4HT.
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.
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 its leasehold property reflected as deemed cost in accordance with FRS 102. The principal accounting policies adopted are set out below.
1.2
Going concern
Having reviewed the company's financial forecasts and expected future cash flows, the directors have a reasonable expectation that the
true
company ha
ve
adequate resources to continue in operational existence for the foreseeable future
. The company continues to hold good cash reserves to shelter against any further anticipated impact of the pandemic and
to continue operationally
.
Thus, the going concern basis has been adopted in preparing the financial statements for the year ended 31 March
2022
.
1.3
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
and
settlement
discounts
.
Entrance fee income, food and beverage, and other ancillary income are recognised when the event takes place or on the provision of the service. Income received prior to the year end for events after the financial year are deferred and recognised in the future period.
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.
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 land and buildings
Over the unexpired term of the lease of 9 years
Leasehold improvements
on cost between 5 and 20 years
Fixtures and fittings
on cost over 5 years
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 the profit and loss account
.
Depreciation methods, useful lives and residual values are reviewed if there is an indication of a significant change since the last annual reporting date in the pattern by which the company expects to consume an asset's future economic benefits.
Short leasehold properties that had been revalued to fair value on or prior to the date of transition to FRS 102, are measured on the basis of deemed cost, being the revalued amount at the date of that revaluation.
PALMGLEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
1
Accounting policies
(Continued)
- 14 -
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
the
profit and loss account
, 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
the profit
and
loss account
, 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
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the stocks to their present location and condition.
At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in
the
profit
and
loss
account
. Reversals of impairment losses are also recognised in
the
profit
and
loss
account
.
1.7
Cash at bank and in hand
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.
1.8
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.
PALMGLEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
1
Accounting policies
(Continued)
- 15 -
Basic financial assets
Basic financial assets, which include
debtors, cash and bank balances and amounts due from its parent company,
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.
Impairment of financial assets
Financial assets, other than those
held
at
fair value through the profit and loss account,
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 the profit and loss account.
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 the profit and loss account.
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.
Basic financial liabilities
Basic financial liabilities, including
creditors,
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.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations
expire or are discharged or cancelled.
1.9
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
PALMGLEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
1
Accounting policies
(Continued)
- 16 -
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.
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.
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.
1.11
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.12
Leases
Rentals payable under operating leases,
including
any lease incentives received, are charged to
the profit and loss account
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 asset are consumed.
1.13
Government grants
Government grants are recognised at the fair value of the asset receive
d
or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
A grant that specifies performance conditions is recognised in income when the performance conditions are met
. Where a
grant does not specify performance conditions
it
is recognised in income when the proceeds are received or receivable
. A grant received before the recognition criteria are satisfied is recognised as a liability.
PALMGLEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
1
Accounting policies
(Continued)
- 17 -
1.14
Foreign exchange
Transactions in currencies other than pounds sterling are recorded at the rates of exchange prevailing at the dates of the transactions. At each reporting end date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the reporting end date. Gains and losses arising on translation
in the period
are included in
the
profit
and
loss
account
.
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.
Key sources of estimation uncertainty
The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are
as follows:
Amortisation and depreciation, useful lives and residual values of tangible fixed assets
The
directors
estimate the useful lives and residual values of
tangible
assets in order to calculate the depreciation charge. Changes in these estimates could result in changes being required to the annual charges in the
profit and loss account
and the carrying values of these assets in the
balance sheet
.
3
Turnover and other revenue
An analysis of the company's turnover is as follows:
2022
2021
£
£
Turnover analysed by class of business
Jazz club, bar and restaurant
10,459,469
1,401,793
2022
2021
£
£
Other revenue
Grants received
277,245
2,064,087
Insurance claim received
1,694,396
-
4
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2022
2021
Number
Number
Staff
80
78
PALMGLEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
4
Employees
(Continued)
- 18 -
Their aggregate remuneration comprised:
2022
2021
£
£
Wages and salaries
2,256,884
2,023,256
Pension costs
43,587
27,688
2,300,471
2,050,944
5
Operating profit/(loss)
2022
2021
Operating profit/(loss) for the year is stated after charging/(crediting):
£
£
Exchange (gains)/losses
(2,149)
3,100
Government grants
(277,245)
(2,064,087)
Fees payable to the company's auditor for the audit of the company's financial statements
10,000
10,000
Depreciation of owned tangible fixed assets
336,000
308,000
Operating lease charges
637,378
167,126
6
Interest payable and similar expenses
2022
2021
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
241
Interest payable to group undertakings
4,939
17,603
5,180
17,603
7
Directors' remuneration
2022
2021
£
£
Remuneration for qualifying services
134,979
274,081
Compensation for loss of office
30,000
134,979
304,081
The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 1 (2021 - 1).
PALMGLEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
7
Directors' remuneration
(Continued)
- 19 -
Remuneration disclosed above include the following amounts paid to the highest paid director:
2022
2021
£
£
Remuneration for qualifying services
n/a
208,386
8
Dividends
2022
2021
£
£
Interim paid
500,000
9
Taxation
2022
2021
£
£
Current tax
UK corporation tax on profits for the current period
931,715
Adjustments in respect of prior periods
510
Total current tax
931,715
510
Deferred tax
Origination and reversal of timing differences
(15,532)
(18,726)
Total tax charge/(credit)
916,183
(18,216)
PALMGLEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
9
Taxation
(Continued)
- 20 -
The actual charge/(credit) for the year can be reconciled to the expected charge/(credit) for the year based on the profit or loss and the standard rate of tax as follows:
2022
2021
£
£
Profit/(loss) before taxation
4,616,275
(72,327)
Expected tax charge/(credit) based on the standard rate of corporation tax in the UK of 19.00% (2021: 19.00%)
877,092
(13,742)
Tax effect of expenses that are not deductible in determining taxable profit
1,457
Other tax adjustments
702
(36,487)
Group relief
(2,687)
(50)
Depreciation in excess of capital allowances
56,608
48,822
Under / (Over) provided in prior years
510
Deferred taxation
(15,532)
(18,726)
Taxation charge/(credit) for the year
916,183
(18,216)
10
Tangible fixed assets
Leasehold land and buildings
Leasehold improvements
Fixtures and fittings
Total
£
£
£
£
Cost
At 1 April 2021 and 31 March 2022
3,653,402
2,529,201
1,163,753
7,346,356
Depreciation and impairment
At 1 April 2021
2,051,707
2,084,184
1,087,630
5,223,521
Depreciation charged in the year
160,170
120,640
55,190
336,000
At 31 March 2022
2,211,877
2,204,824
1,142,820
5,559,521
Carrying amount
At 31 March 2022
1,441,525
324,377
20,933
1,786,835
At 31 March 2021
1,601,695
445,017
76,123
2,122,835
11
Stocks
2022
2021
£
£
Finished goods and goods for resale
96,155
82,981
PALMGLEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
- 21 -
12
Debtors
2022
2021
Amounts falling due within one year:
£
£
Trade debtors
232,920
32,573
Amounts owed by group undertakings
1,761,121
1,421,059
Other debtors
1,000
55,746
Prepayments and accrued income
483,717
76,755
2,478,758
1,586,133
13
Creditors: amounts falling due within one year
2022
2021
Notes
£
£
Bank loans
15
3,192
Trade creditors
546,567
23,690
Corporation tax
513,715
Other taxation and social security
424,976
352,875
Other creditors
638,156
1,035,813
Accruals and deferred income
1,818,346
1,611,871
3,941,760
3,027,441
14
Creditors: amounts falling due after more than one year
2022
2021
Notes
£
£
Bank loans and overdrafts
15
46,808
15
Loans and overdrafts
2022
2021
£
£
Bank loans
50,000
Payable within one year
3,192
Payable after one year
46,808
In
November 2020
, a
bounce-back loan
was secured with the
company's
bankers. The rate of interest charged is
fixed at 2.5%
. The termination date for this facility
was
6
years from the date of the first drawdown, being
December
20
26
.
Capital repayments were by monthly instalments until the termination date. The bounce-back loan was repaid in full in January 2022.
PALMGLEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
- 22 -
16
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2022
2021
Balances:
£
£
Accelerated capital allowances
35,263
50,795
2022
Movements in the year:
£
Liability at 1 April 2021
50,795
Credit to the profit and loss account
(15,532)
Liability at 31 March 2022
35,263
The deferred tax liability set out above is expected to reverse and relates to accelerated capital allowances that are expected to mature within the same period.
17
Share capital
2022
2021
2022
2021
Ordinary share capital
Number
Number
£
£
Issued and fully paid
Ordinary of £1 each
548,024
548,024
548,024
548,024
18
Retirement benefit schemes
2022
2021
Defined contribution schemes
£
£
Charge to the profit and loss account in respect of defined contribution schemes
43,587
27,688
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.
19
Financial commitments, guarantees and contingent liabilities
The company has provided a cross-guarantee in favour of a bank facility provided by HSBC Bank plc to this company's parent undertaking. At the year end, the amount owed by The Ronnie Scott's Jazz Club Limited was £
nil
(20
21
: £
306,326
)
as the loan was redeemed in December 2021
. There is a fixed and floating charge over the assets of the company in favour of the company's bankers.
PALMGLEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
- 23 -
20
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:
2022
2021
£
£
Within one year
655,001
655,001
Between two and five years
2,620,004
2,620,004
In over five years
3,002,088
3,657,089
6,277,093
6,932,094
21
Ultimate controlling party
The immediate and ultimate parent company is The Ronnie Scott's Jazz Club Limited, a company registered in England and Wales. Copies of the group financial statements can be obtained from Companies House.
In the opinion of the directors
, th
e group was controlled by S Greene
together with her family
.
PALMGLEN LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2022
- 24 -
22
Related party transactions
The company has taken advantage of the exemption available under FRS102 1A whereby it has not disclosed transactions and balances with any wholly owned group companies.
Included within other creditors at the year end is an amount of £
nil
(20
21: £68,750
) due to the director
M Watt
. This amount ha
d
been provided unsecured
and
interest free.
Included within other creditors at the year end is an amount of £
nil
(20
21: £206,250
) due
to
Jazz Box Limited, a company which holds a 25% interest in The Ronnie Scott's Jazz Club Limited
. This amount h
ad
been provided unsecured
and
interest free
.
During the year, the company
charged
£
981
(20
21
: £
15,794
) to Greene Light Stage plc for services provided. At the year end, an amount of £
13,609
(20
21
: £
12,432
) was due from this entity.
S A Greene is a director and shareholder in Greene Light Stage plc.
During the year, a company of which M Bucks is a director charged the company professional fees of £91,667 (2021: £nil) for services provided.
At the year end, an amount of £
30,000
(20
21
: £
nil
) was due
to
this entity
.
During the year, the company made charitable donations aggregating £
nil
(20
21
: £
nil)
to Ronnie Scott's Charitable Foundation. Certain trustees of the foundation are directors of this company. At the year end, an amount of £
22,799
(20
21
: £
1,109
) was due
to
this charity.
23
Analysis of changes in net funds
1 April 2021
Cash flows
31 March 2022
£
£
£
Cash at bank and in hand
2,900,193
3,482,272
6,382,465
Borrowings excluding overdrafts
(50,000)
50,000
-
2,850,193
3,532,272
6,382,465
24
Cash generated from operations
2022
2021
£
£
Profit/(loss) for the year after tax
3,700,092
(54,111)
Adjustments for:
Taxation charged/(credited)
916,183
(18,216)
Finance costs
5,180
17,603
Depreciation and impairment of tangible fixed assets
336,000
308,000
Movements in working capital:
Increase in stocks
(13,174)
(9,694)
Decrease in debtors
(892,625)
2,404
Increase in creditors
403,796
412,725
Cash generated from operations
4,455,452
658,711
2022-03-31
2021-04-01
false
CCH Software
CCH Accounts Production 2022.300
S Greene
B Bourne
B Bourne
M Bucks
M Watt
S Xuan Bui
A Davies
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