Company Registration No. 02210916 (England and Wales)
BRADWELL HALL NURSING HOME LIMITED
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2019
BRADWELL HALL NURSING HOME LIMITED
COMPANY INFORMATION
Directors
Mr E Twigge
Mr M D Twigge
Mr J Twigge
Mrs J V Carson
Secretary
Mr E Twigge
Company number
02210916
Registered office
Bradwell Hall
Old Hall Drive
Bradwell
Newcastle under Lyme
Staffordshire
ST5 8RQ
Auditor
WCCA Limited
2-6 Adventure Place
Hanley
Stoke on Trent
Staffordshire
ST1 3AF
Accountants
Bruce Marshall & Co Limited
3 Crewe Road
Sandbach
Cheshire
CW11 4NE
BRADWELL HALL NURSING HOME LIMITED
CONTENTS
Page
Strategic report
1
Directors' report
2 - 3
Independent auditor's report
4 - 6
Profit and loss account
7
Statement of comprehensive income
8
Balance sheet
9
Statement of changes in equity
10
Statement of cash flows
11
Notes to the financial statements
12 - 23
BRADWELL HALL NURSING HOME LIMITED
STRATEGIC REPORT
FOR THE YEAR ENDED 31 MARCH 2019
- 1 -
The directors present the strategic report for the year ended 31 March 2019.
Fair review of the business
During the year the company has seen its turnover increase by £2.18m and it gross profit increase by £0.4m. The company acquired a second care home in the local area during the year.
The directors consider the results for the year to be satisfactory.
Principal risks and uncertainties
The main risks associated with the business relate to the level of competition in the area. The company prides itself on the service provided to its customers and the directors believe that if they continue to provide a high level of care for the customers then it will continue to be competitive in the local market.
The current global situation regarding COVID-19 is of great concern to the directors due the business providing care to many elderly and vulnerable people. The directors have imposed strict guidelines at the care home following government and health department guidelines. By adhering to these policies the directors believe that disruption to the care service that they provide will not be significant.
Development and performance
Following the acquisition of a second care home during the year under review the company has invested significant funds in developing the site to enable it to continue to provide a high level of care throughout the local area.
The anticipate continued future growth for the business following its expansion.
Key performance indicators
The company measures its performance by monitoring margins achieved against expectations and also against occupancy rates in the care home. The directors review the financial information on a monthly basis to asses how the company is performing and takes corrective action in key performance indicators are not being met.
Mr E Twigge
Secretary
30 March 2020
BRADWELL HALL NURSING HOME LIMITED
DIRECTORS' REPORT
FOR THE YEAR ENDED 31 MARCH 2019
- 2 -
The directors present their annual report and financial statements for the year ended 31 March 2019.
Principal activities
The principal activity of the company continued to be that of a nursing home.
Directors
The directors who held office during the year and up to the date of signature of the financial statements were as follows:
Mr E Twigge
Mr M D Twigge
Mr J Twigge
Mrs J V Carson
Results and dividends
The results for the year are set out on page 7.
Ordinary dividends were paid amounting to £700,000. The directors do not recommend payment of a final dividend.
Disabled persons
Applications for employment by disabled persons are always fully considered, bearing in mind the aptitudes of the applicant concerned. In the event of members of staff becoming disabled, every effort is made to ensure that their employment within the company continues and that the appropriate training is arranged. It is the policy of the company that the training, career development and promotion of disabled persons should, as far as possible, be identical to that of other employees.
Auditor
WCCA Limited were appointed as auditor to the company and in accordance with section 485 of the Companies Act 2006, a resolution proposing that they be re-appointed will be put at a General Meeting.
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;
-
state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements;
-
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.
BRADWELL HALL NURSING HOME LIMITED
DIRECTORS' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2019
- 3 -
Statement of disclosure to auditor
So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the company’s auditor is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the company’s auditor is aware of that information.
By order of the board
Mr E Twigge
Secretary
30 March 2020
BRADWELL HALL NURSING HOME LIMITED
INDEPENDENT AUDITOR'S REPORT
TO THE MEMBERS OF BRADWELL HALL NURSING HOME LIMITED
- 4 -
Qualified opinion on financial statements of Bradwell Nursing Home Limited
We have audited the financial statements of Bradwell Hall Nursing Home Limited (the 'company') for the year ended 31 March 2019 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 a summary of significant accounting policies.
The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102
The Financial Reporting Standard applicable in the UK and Republic of Ireland
(United Kingdom Generally Accepted Accounting Practice).
In our opinion, except for the effects of the matter described in the Basis for Qualified Opinion paragraph, the financial statements:
-
give a true and fair view of the state of the company's affairs as at 31 March 2019 and of its profit for the year then ended;
-
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
-
have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for qualified opinion
The evidence available to us was limited because we were appointed as auditors during the year and we have been unable to carry out auditing procedures necessary to obtain adequate assurance regarding the opening balances and comparative figures because the financial statements for the year ended 31 March 2018 were unaudited. Any adjustments to the opening balances would have a consequential effect on the profit for the year. In addition, the amounts shown as corresponding amounts for the year ended 31 March 2018 may not be comparable with the figures for the current period.
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 qualified opinion.
Other matter
Comparative information in the financial statements is derived from the company's prior period financial statements which were not audited.
Conclusions relating to going concern
We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:
-
the directors' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or
-
the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the company’s ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue
.
BRADWELL HALL NURSING HOME LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF BRADWELL HALL NURSING HOME LIMITED
- 5 -
The directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. Our opinion on the
financial statements
does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of our audit
:
-
the information given in the strategic report and the directors' r
eport for the financial year for which the financial statements are prepared is consistent with the financial statements
; and
-
the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In respect solely of the limitation on our work relating to stock, described above:
-
we have not obtained all the information and explanations that we considered necessary for the purpose of our audit; and
-
we were unable to determine whether adequate accounting records had been maintained.
In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identifie
d
material misstatements in the strategic report and the directors'
r
eport
.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
-
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
-
the financial statements are not in agreement with the accounting records and returns; or
-
certain disclosures of directors' remuneration specified by law are not made; or
-
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors'
r
esponsibilities
s
tatement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
BRADWELL HALL NURSING HOME LIMITED
INDEPENDENT AUDITOR'S REPORT (CONTINUED)
TO THE MEMBERS OF BRADWELL HALL NURSING HOME LIMITED
- 6 -
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
A further description of our responsibilities for the audit of the financial statements is located on the
Financial Reporting Council’s website at: http://www.frc.org.uk/auditorsresponsibilities
.
This description forms part of our auditor’s report.
Mr Keith R Salt (Senior Statutory Auditor)
for and on behalf of WCCA Limited
30 March 2020
Chartered Certified Accountants
Statutory Auditor
2-6 Adventure Place
Hanley
Stoke on Trent
Staffordshire
ST1 3AF
BRADWELL HALL NURSING HOME LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 MARCH 2019
- 7 -
2019
2018
Notes
£
£
Turnover
3
11,292,479
9,105,244
Cost of sales
(8,095,411)
(6,307,269)
Gross profit
3,197,068
2,797,975
Distribution costs
(89,209)
(341,621)
Administrative expenses
(2,485,868)
(1,630,329)
Other operating income
128,095
132,113
Operating profit
4
750,086
958,138
Interest receivable and similar income
7
3,030
453
Interest payable and similar expenses
8
(135,310)
(106,000)
Profit before taxation
617,806
852,591
Tax on profit
9
(160,404)
(182,307)
Profit for the financial year
457,402
670,284
The profit and loss account has been prepared on the basis that all operations are continuing operations.
BRADWELL HALL NURSING HOME LIMITED
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 MARCH 2019
- 8 -
2019
2018
£
£
Profit for the year
457,402
670,284
Other comprehensive income
-
-
Total comprehensive income for the year
457,402
670,284
BRADWELL HALL NURSING HOME LIMITED
BALANCE SHEET
AS AT
31 MARCH 2019
31 March 2019
- 9 -
2019
2018
Notes
£
£
£
£
Fixed assets
Tangible assets
11
3,275,632
185,633
Current assets
Stocks
13
2,000
2,000
Debtors
14
4,223,594
4,454,438
Cash at bank and in hand
2,868,808
2,661,033
7,094,402
7,117,471
Creditors: amounts falling due within one year
15
(1,616,831)
(1,315,149)
Net current assets
5,477,571
5,802,322
Total assets less current liabilities
8,753,203
5,987,955
Creditors: amounts falling due after more than one year
16
(4,944,725)
(1,973,150)
Provisions for liabilities
18
(36,271)
-
Net assets
3,772,207
4,014,805
Capital and reserves
Called up share capital
21
100
100
Share premium account
33
33
Profit and loss reserves
3,772,074
4,014,672
Total equity
3,772,207
4,014,805
The financial statements were approved by the board of directors and authorised for issue on 30 March 2020 and are signed on its behalf by:
Mr E Twigge
Director
Company Registration No. 02210916
BRADWELL HALL NURSING HOME LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 MARCH 2019
- 10 -
Share capital
Share premium account
Profit and loss reserves
Total
Notes
£
£
£
£
Balance at 1 April 2017
100
33
3,344,388
3,344,521
Year ended 31 March 2018:
Profit and total comprehensive income for the year
-
-
670,284
670,284
Balance at 31 March 2018
100
33
4,014,672
4,014,805
Year ended 31 March 2019:
Profit and total comprehensive income for the year
-
-
457,402
457,402
Dividends
10
-
-
(700,000)
(700,000)
Balance at 31 March 2019
100
33
3,772,074
3,772,207
BRADWELL HALL NURSING HOME LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 MARCH 2019
- 11 -
2019
2018
Notes
£
£
£
£
Cash flows from operating activities
Cash generated from operations
25
1,553,134
1,446,954
Interest paid
(135,310)
(106,000)
Income taxes paid
(72,099)
(325,028)
Net cash inflow from operating activities
1,345,725
1,015,926
Investing activities
Purchase of tangible fixed assets
(3,192,706)
(45,369)
Proceeds from other investments and loans
(292,980)
(93,975)
Interest received
3,030
453
Net cash used in investing activities
(3,482,656)
(138,891)
Financing activities
Repayment of borrowings
(23,426)
(70,715)
Repayment of bank loans
3,068,132
-
Dividends paid
(700,000)
-
Net cash generated from/(used in) financing activities
2,344,706
(70,715)
Net increase in cash and cash equivalents
207,775
806,320
Cash and cash equivalents at beginning of year
2,661,033
1,854,713
Cash and cash equivalents at end of year
2,868,808
2,661,033
BRADWELL HALL NURSING HOME LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2019
- 12 -
1
Accounting policies
Company information
Bradwell Hall Nursing Home Limited is a
private
company
limited by shares
incorporated in England and Wales.
The registered office is
Bradwell Hall, Old Hall Drive, Bradwell, Newcastle under Lyme, Staffordshire, ST5 8RQ.
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 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
A
true
t the time of approving the financial statements
,
t
he directors have a reasonable expectation that the
company
has adequate resources to continue in operational existence for the foreseeable future. Thus
t
he directors continue to adopt the going concern basis of accounting in preparing the financial statements.
1.3
Turnover
Turnover is recognised at the fair value of the consideration received or receivable for services provided in the normal course of business
.
The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.
Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that
it is probable will be
recover
ed
.
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:
Freehold land and buildings
2% straight line
Plant and equipment
15% reducing balance
Fixtures and fittings
15% reducing balance
Motor vehicles
25% reducing balance
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
.
BRADWELL HALL NURSING HOME LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2019
1
Accounting policies
(Continued)
- 13 -
Freehold land and buildings are not depreciated as it is the policy of the company to maintain the property in a condition where it would retain its original value.
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.
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
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.
Stocks held for distribution at no or nominal consideration are measured at the lower of replacement cost and cost, adjusted where applicable for any loss of service potential.
Stock is valued at current cost price.
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 profit or loss. Reversals of impairment losses are also recognised in profit or loss.
1.7
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.
BRADWELL HALL NURSING HOME LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2019
1
Accounting policies
(Continued)
- 14 -
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.
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.
Impairment of financial assets
Financial assets, other than those
held
at
fair value through profit and loss
, are assessed for indicators of impairment at each reporting end date.
Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected.
If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.
If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been, had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.
Derecognition of financial assets
Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when
the company
transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.
Classification of financial liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.
BRADWELL HALL NURSING HOME LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2019
1
Accounting policies
(Continued)
- 15 -
Basic financial liabilities
Basic financial liabilities, including creditors, bank loans, loans from
fellow group companies and preference shares that are classified as debt, are
initially recognised at transaction price unless the arrangement constitutes a
financing transaction, where the debt instrument is measured at the present value of
the future
paymen
ts discounted at a market rate of interest.
Financial liabilities classified as payable within one year are not amortised.
Debt instruments are subsequently carried at amortised cost, using the effective
interest rate method.
Trade creditors
are obligations to pay for goods or services that have been acquired
in the ordinary course of business from suppliers. A
m
ounts payable are classified as
current liabilities if payment is due within one year or less. If not, they are presented
as non-current liabilities. Trade creditors are recognised initially at transaction price
and subsequently measured at amortised cost using the effective interest method.
Other financial liabilities
Derivatives, including interest rate swaps and forward foreign exchange contracts,
are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are
s
ubsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.
Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as
being measured at
fair value though profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.
Derecognition of financial liabilities
Financial liabilities are derecognised when the company’s contractual obligations
expire or are discharged or cancelled.
1.9
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.
1.10
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The
company’s
liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.
BRADWELL HALL NURSING HOME LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2019
1
Accounting policies
(Continued)
- 16 -
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.
1.11
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.
1.12
Retirement benefits
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.
1.13
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.
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.
BRADWELL HALL NURSING HOME LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2019
- 17 -
3
Turnover and other revenue
2019
2018
£
£
Other significant revenue
Interest income
3,030
453
4
Operating profit
2019
2018
Operating profit for the year is stated after charging:
£
£
Fees payable to the company's auditor for the audit of the company's financial statements
7,000
-
Depreciation of owned tangible fixed assets
102,707
35,169
Cost of stocks recognised as an expense
595,950
577,205
Operating lease charges
700,000
602,158
5
Employees
The average monthly number of persons (including directors) employed by the company during the year was:
2019
2018
Number
Number
Care staff
349
343
Directors
4
4
353
347
Their aggregate remuneration comprised:
2019
2018
£
£
Wages and salaries
5,546,381
4,571,613
Social security costs
351,187
278,507
Pension costs
91,439
147,135
5,989,007
4,997,255
6
Directors' remuneration
2019
2018
£
£
Remuneration for qualifying services
309,266
173,600
BRADWELL HALL NURSING HOME LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2019
6
Directors' remuneration
(Continued)
- 18 -
Remuneration disclosed above include the following amounts paid to the highest paid director:
2019
2018
£
£
Remuneration for qualifying services
83,417
-
7
Interest receivable and similar income
2019
2018
£
£
Interest income
Interest on bank deposits
1,500
453
Other interest income
1,530
-
Total income
3,030
453
Investment income includes the following:
Interest on financial assets not measured at fair value through profit or loss
1,500
453
8
Interest payable and similar expenses
2019
2018
£
£
Interest on financial liabilities measured at amortised cost:
Interest on bank overdrafts and loans
29,281
-
Other finance costs:
Other interest
106,029
106,000
135,310
106,000
9
Taxation
2019
2018
£
£
Current tax
UK corporation tax on profits for the current period
124,133
182,307
Deferred tax
Origination and reversal of timing differences
36,271
-
Total tax charge
160,404
182,307
BRADWELL HALL NURSING HOME LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2019
9
Taxation
(Continued)
- 19 -
The actual charge for the year can be reconciled to the expected charge for the year based on the profit or loss and the standard rate of tax as follows:
2019
2018
£
£
Profit before taxation
617,806
852,591
Expected tax charge based on the standard rate of corporation tax in the UK of 19.00% (2018: 19.00%)
117,383
161,992
Effect of change in corporation tax rate
(555)
-
Depreciation on assets not qualifying for tax allowances
12,017
-
Deferred tax adjustments in respect of prior years
31,559
20,315
Taxation charge for the year
160,404
182,307
10
Dividends
2019
2018
£
£
Interim paid
700,000
-
11
Tangible fixed assets
Freehold land and buildings
Plant and equipment
Fixtures and fittings
Motor vehicles
Total
£
£
£
£
£
Cost
At 1 April 2018
-
584,606
280,616
34,722
899,944
Additions
3,125,524
56,089
11,093
-
3,192,706
At 31 March 2019
3,125,524
640,695
291,709
34,722
4,092,650
Depreciation and impairment
At 1 April 2018
-
433,759
261,207
19,345
714,311
Depreciation charged in the year
63,248
31,040
4,575
3,844
102,707
At 31 March 2019
63,248
464,799
265,782
23,189
817,018
Carrying amount
At 31 March 2019
3,062,276
175,896
25,927
11,533
3,275,632
At 31 March 2018
-
150,846
19,409
15,378
185,633
BRADWELL HALL NURSING HOME LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2019
- 20 -
12
Financial instruments
2019
2018
£
£
Carrying amount of financial assets
Debt instruments measured at amortised cost
4,198,439
4,454,438
Carrying amount of financial liabilities
Measured at amortised cost
6,312,879
3,130,722
13
Stocks
2019
2018
£
£
Finished goods and goods for resale
2,000
2,000
14
Debtors
2019
2018
Amounts falling due within one year:
£
£
Trade debtors
1,027,255
773,039
Amounts owed by group undertakings
2,658,465
3,377,794
Other debtors
512,719
303,605
Prepayments and accrued income
25,155
-
4,223,594
4,454,438
15
Creditors: amounts falling due within one year
2019
2018
Notes
£
£
Bank loans
17
73,131
-
Trade creditors
323,640
137,065
Corporation tax
145,319
93,285
Other taxation and social security
103,358
64,292
Other creditors
907,211
997,607
Accruals and deferred income
64,172
22,900
1,616,831
1,315,149
BRADWELL HALL NURSING HOME LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2019
- 21 -
16
Creditors: amounts falling due after more than one year
2019
2018
Notes
£
£
Bank loans and overdrafts
17
2,995,001
-
Other borrowings
17
1,949,724
1,973,150
4,944,725
1,973,150
Amounts included above which fall due after five years are as follows:
Payable by instalments
2,178,866
-
17
Loans and overdrafts
2019
2018
£
£
Bank loans
3,068,132
-
Other loans
1,949,724
1,973,150
5,017,856
1,973,150
Payable within one year
73,131
-
Payable after one year
4,944,725
1,973,150
The long-term loans are secured by fixed and floating charges over the assets of the company.
18
Provisions for liabilities
2019
2018
Notes
£
£
Deferred tax liabilities
19
36,271
-
19
Deferred taxation
The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:
Liabilities
Liabilities
2019
2018
Balances:
£
£
Accelerated capital allowances
36,271
-
BRADWELL HALL NURSING HOME LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2019
19
Deferred taxation
(Continued)
- 22 -
2019
Movements in the year:
£
Liability at 1 April 2018
-
Effect of change in tax rate - profit or loss
36,271
Liability at 31 March 2019
36,271
20
Retirement benefit schemes
2019
2018
Defined contribution schemes
£
£
Charge to profit or loss in respect of defined contribution schemes
91,439
147,135
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.
21
Share capital
2019
2018
£
£
Ordinary share capital
Issued and fully paid
66 Ordindary shares of £1 each
66
66
2 A Ordinary shares of £1 each
2
2
32 B Ordinary shares of £1 each
32
32
100
100
The different classes of shares rank pari passu in all aspects other than the right to vote. Only the ordinary shares carry voting rights.
23
Directors' transactions
Description
% Rate
Opening balance
Amounts advanced
Closing balance
£
£
£
current account
-
93,975
-
93,975
current account
-
(208,015)
500,995
292,980
(114,040)
500,995
386,955
BRADWELL HALL NURSING HOME LIMITED
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
FOR THE YEAR ENDED 31 MARCH 2019
- 23 -
24
Ultimate controlling party
The company is a wholly owned subsidiary of Huggies Day Nursery Limited a company registered in England.
The largest and smallest group of undertakings for which group accounts have been prepared is that headed up by Huggies Day Nursery Limited, Group consolidated financial statements can be obtained from the registered office of Huggies Day Nursery Limited.
25
Cash generated from operations
2019
2018
£
£
Profit for the year after tax
457,402
670,284
Adjustments for:
Taxation charged
160,404
182,307
Finance costs
135,310
106,000
Investment income
(3,030)
(453)
Depreciation and impairment of tangible fixed assets
102,707
35,169
Movements in working capital:
Decrease in debtors
523,824
386,420
Increase in creditors
176,517
67,227
Cash generated from operations
1,553,134
1,446,954
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