Aspects 2 Limited - Limited company accounts 18.2

REGISTERED NUMBER: 06660529 (England and Wales)

STRATEGIC REPORT,

REPORT OF THE DIRECTORS AND

FINANCIAL STATEMENTS

FOR THE PERIOD

1 NOVEMBER 2017 TO 30 JUNE 2018

FOR

ASPECTS 2 LIMITED

Page

Company Information

1

Strategic Report

2

Report of the Directors

4

Report of the Independent Auditors

5

Statement of Income and Retained Earnings

7

Balance Sheet

8

Notes to the Financial Statements

9

DIRECTORS:

Mrs S B Jalil

Mrs R Kousar

REGISTERED OFFICE:

Kingston House

432-452 High Street

West Bromwich

West Midlands

B70 9LD

REGISTERED NUMBER:

06660529 (England and Wales)

AUDITORS:

Luckmans Duckett Parker Limited

Chartered Accountants

Statutory Auditors

1110 Elliott Court

Herald Avenue

Coventry Business Park

Coventry

West Midlands

CV5 6UB

The directors present their strategic report for the period 1 November 2017 to 30 June 2018.

REVIEW OF BUSINESS

The company was acquired by Rehability Group Limited on 16 February 2018. As a result, the year end was

amended from 31 October to 30 June to align with Rehability Group Limited.

The results for the 8 month period as set out in the Statement of Income and Retained Earnings show an

operating surplus of £148,827 (Year ending 31 October 2017: surplus of £680,545).

At 30 June 2018, the company had net assets of £1,177,248 (Year ending 31 October 2017: net assets of

£6,169,381).

The company monitors the following key performance indicators:

Key Performance Indicators at 30 June 2018

Gross profit

29.5%

Direct staff costs as % of turnover

68.1%

Care Quality Commission Rating:

Abbeymead Lodge

Outstanding (September 2018)

Apperley House

Good (April 2017)

Aspects 2 Supported Living Service

Requires Improvement (July 2018)

Hannacott

Outstanding (March 2017)

PRINCIPAL RISKS AND UNCERTAINTIES

The sector is subject to stringent regulatory requirements set by the Care Quality Commission (CQC). There

are significant costs associated with achieving a compliant standard of care.

The company's main customers are local authorities. Many local authorities are struggling to manage the

financial pressures caused by Government budget cuts and the increasing demand for social care.

As a service provider, staff costs are the company's largest expense. The company incurred direct staff costs

of £1,690,183, which equated to 68.1% of turnover. Recruitment in the care sector is a significant challenge,

with supply unable to cope with an ageing population.

KEY PERFORMANCE INDICATORS

Given the nature of the business, the company's directors are of the opinion that key performance indicators

are important. The company uses a number of indicators to monitor and improve the development,

performance and the position of the business. Indicators are reviewed and altered to meet changes both in

the internal and external environments. The directors do not consider the inclusion of an analysis using key

performance indicators to be necessary to assist users of the financial statements in their understanding of

the financial performance or position of the company.

OBJECTIVES AND POLICIES

The company is exposed to the usual credit and cash flow risk associated with selling on credit and manages

this through credit control procedures. The board constantly monitors the company's trading results to ensure

that the company can meet its future obligations as they fall due.

PRICE RISK, CREDIT RISK, LIQUIDITY RISK AND CASH FLOW RISK

In accordance with the Financial Reporting Council's 'Going Concern and Liquidity Risk: Guidance for

Directors of UK Companies 2009' the directors of all companies are now required to provide disclosures

regarding the adoption of the going concern basis of accounting.

The company has sufficient financial resources available and continues to trade profitably generating cash.

The directors have considered the likely future performance of the business and expect that these trends will

continue. The directors therefore have a reasonable expectation that the company has adequate resources to

continue in operational existence for the foreseeable future and have continued to adopt the going concern

basis in preparing the financial statements.

ON BEHALF OF THE BOARD:

Mrs S B Jalil - Director

27 March 2019

The directors present their report with the financial statements of the company for the period 1 November 2017 to 30 June 2018.

DIVIDENDS

During the period total dividends of £30,000 were paid to the former directors of the company. Since the

acquisition of the company by Rehability UK Community Limited dividends totalling £585,000 have been paid

to the new parent company.

DIRECTORS

The directors who have held office during the period from 1 November 2017 to the date of this report are as

follows:

Mrs S B Jalil - appointed 16 February 2018

Mrs R Kousar - appointed 16 February 2018

I J J Salter - resigned 16 February 2018

Ms S J Workman - resigned 16 February 2018

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Strategic Report, the Report of the Directors 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 AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the

Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps

that she ought to have taken as a director in order to make herself aware of any relevant audit information

and to establish that the company's auditors are aware of that information.

AUDITORS

The auditors, Luckmans Duckett Parker Limited, will be proposed for re-appointment at the forthcoming

Annual General Meeting.

ON BEHALF OF THE BOARD:

Mrs S B Jalil - Director

27 March 2019

Opinion

We have audited the financial statements of Aspects 2 Limited (the 'company') for the period ended

30 June 2018 which comprise the Statement of Income and Retained Earnings, Balance Sheet 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 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 30 June 2018 and of its loss for the period 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 opinion

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 Auditors'

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

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.

Other information

The directors are responsible for the other information. The other information comprises the information in the

Strategic Report and the Report of the Directors, but does not include the financial statements and our Report

of the Auditors 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.

Opinion on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

-	the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of

the audit, we have not identified material misstatements in the Strategic Report or the Report of the Directors.

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 Statement of Directors' Responsibilities set out on page four, 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 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.

Auditors' 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 a Report of the Auditors 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 www.frc.org.uk/auditorsresponsibilities. This description forms part of our

Report of the Auditors.

Use of our 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 a Report of the Auditors 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.

Mark Spafford ACA FCCA (Senior Statutory Auditor)

for and on behalf of Luckmans Duckett Parker Limited

Chartered Accountants

Statutory Auditors

1110 Elliott Court

Herald Avenue

Coventry Business Park

Coventry

West Midlands

CV5 6UB

27 March 2019

TURNOVER

3

2,322,167

3,758,790

Cost of sales

1,588,727

2,323,075

GROSS PROFIT

733,440

1,435,715

Administrative expenses

584,613

755,170

OPERATING PROFIT

5

148,827

680,545

Losses on non-trading loan

relationships

(4,506,120

)

-

Interest receivable and similar income

7

-

131,636

(4,506,120

)

131,636

(LOSS)/PROFIT BEFORE TAXATION

(4,357,293

)

812,181

Tax on (loss)/profit

8

20,112

162,301

(LOSS)/PROFIT FOR THE FINANCIAL PERIOD

(4,377,405

)

649,880

Retained earnings at beginning of period

6,169,381

5,559,501

Dividends

9

(615,000

)

(40,000

)

RETAINED EARNINGS AT END OF PERIOD

1,176,976

6,169,381

FIXED ASSETS

Tangible assets

10

24,944

166,808

CURRENT ASSETS

Debtors: amounts falling due within one year

11

1,784,172

576,775

Debtors: amounts falling due after more than one year

11

-

4,521,284

Cash at bank and in hand

289,559

1,439,443

2,073,731

6,537,502

CREDITORS

Amounts falling due within one year

12

921,697

530,798

NET CURRENT ASSETS

1,152,034

6,006,704

TOTAL ASSETS LESS CURRENT LIABILITIES

1,176,978

6,173,512

PROVISIONS FOR LIABILITIES

14

-

4,129

NET ASSETS

1,176,978

6,169,383

CAPITAL AND RESERVES

Called up share capital

15

2

2

Retained earnings

16

1,176,976

6,169,381

SHAREHOLDERS' FUNDS

1,176,978

6,169,383

The financial statements were approved by the Board of Directors on 27 March 2019 and were signed on its behalf by:

Mrs S B Jalil - Director

1.	STATUTORY INFORMATION

Aspects 2 Limited is a private company, limited by shares , registered in England and Wales. The

company's registered number and registered office address can be found on the Company Information

page.

The presentation currency of the financial statements is the Pound Sterling (£).

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

Financial Reporting Standard 102 - reduced disclosure exemptions

The company has taken advantage of the following disclosure exemptions in preparing these financial

statements, as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and

Republic of Ireland":

•

the requirements of Section 7 Statement of Cash Flows;

•

the requirement of Section 33 Related Party Disclosures paragraph 33.7.

Preparation of consolidated financial statements

The financial statements contain information about Aspects 2 Limited as an individual company and do

not contain consolidated financial information as the parent of a group. The company is exempt under

Section 400 of the Companies Act 2006 from the requirements to prepare consolidated financial

statements as it and its subsidiary undertaking are included by full consolidation in the consolidated

financial statements of its parent, Rehability UK Community Ltd, 1110 Elliott Court Coventry Business

Park, Herald Avenue, Coventry, West Midlands, United Kingdom, CV5 6UB.

Significant judgements and estimates

These financial statements do not contain any significant judgements or estimates.

Turnover

Turnover represents amounts receivable during the year for the provision of care and accommodation.

Where the amount received relates to a period which covers the balance sheet date that amount is

apportioned over the period to which it relates.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated

useful life.

Fixtures and fittings - 20% on cost

Motor vehicles - 25% on reducing balance

Computer equipment - 33% on cost

Following the acquisition the company has adopted the new group's accounting estimates. The

following fixed asset depreciation rates are now in use:

Leasehold Buildings - Over the remaining life of the lease

Fixtures and fittings - 25% on cost

Motor vehicles - 33.33% on cost

Computer Equipment - 33.33% on cost

Taxation

Taxation for the period comprises current and deferred tax. Tax is recognised in the Statement of

Comprehensive Income, except to the extent that it relates to items recognised in other comprehensive

income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been

enacted or substantively enacted by the balance sheet date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at

the balance sheet date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods

different from those in which they are recognised in financial statements. Deferred tax is measured

using tax rates and laws that have been enacted or substantively enacted by the period end and that

are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable

that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Pension costs and other post-retirement benefits

The company operates a defined contribution pension scheme. Contributions payable to the

company's pension scheme are charged to profit or loss in the period to which they relate.

Going concern

After reviewing the company's forecasts and projections, the directors have a reasonable expectation

that the company has adequate resources to continue in operational existence for the foreseeable

future. The company therefore continues to adopt the going concern basis in preparing its financial

statements.

Change of accounting period

The company's year end has been shortened from 01 November 2018 to 30 June 2018 to align the

company's year end with that of the ultimate parent company. The accounts to 30 June 2018 are an 8

month period with comparatives to 31 October 2017 being a 12 month period. As a result the

comparatives may not be entirely comparable.

3.

TURNOVER

The turnover and loss (2017 - profit) before taxation are attributable to the one principal activity of the

company.

4.	EMPLOYEES AND DIRECTORS

Period

1.11.17

to

Year Ended

30.6.18

31.10.17

£

£

Wages and salaries

1,435,161

2,101,028

Social security costs

110,149

143,980

Other pension costs

12,815

12,445

1,558,125

2,257,453

The average number of employees during the period was as follows:

Period

1.11.17

to

Year Ended

30.6.18

31.10.17

Administration and support

1

1

Care staff

135

146

136

147

Period

1.11.17

to

Year Ended

30.6.18

31.10.17

£

£

Directors' remuneration

-

19,983

5.	OPERATING PROFIT

The operating profit is stated after charging:

Period

1.11.17

to

Year Ended

30.6.18

31.10.17

£

£

Depreciation - owned assets

3,872

36,812

Loss on disposal of fixed assets

147,892

-

Auditors' remuneration

5,575

8,000

6.	LOSSES ON NON-TRADING LOAN RELATIONSHIPS

Period

1.11.17

to

Year Ended

30.6.18

31.10.17

£

£

Losses on non-trading loan

relationships

(4,506,120

)

-

7.

INTEREST RECEIVABLE AND SIMILAR INCOME

Period

1.11.17

to

Year Ended

30.6.18

31.10.17

£

£

Other interest received

-

131,636

8.

TAXATION

Analysis of the tax charge

The tax charge on the loss for the period was as follows:

Period

1.11.17

to

Year Ended

30.6.18

31.10.17

£

£

Current tax:

UK corporation tax

24,241

162,662

Tax moving over/under to P&L

-

642

Total current tax

24,241

163,304

Deferred tax

(4,129

)

(1,003

)

Tax on (loss)/profit

20,112

162,301

Reconciliation of total tax charge included in profit and loss

The tax assessed for the period is higher than the standard rate of corporation tax in the UK. The

difference is explained below:

Period

1.11.17

to

Year Ended

30.6.18

31.10.17

£

£

(Loss)/profit before tax

(4,357,293

)

812,181

(Loss)/profit multiplied by the standard rate of corporation tax in the UK of 19% (2017 - 19%)

(827,886

)

154,314

Effects of:

Expenses not deductible for tax purposes

856,164

-

Depreciation in excess of capital allowances

22,192

1,003

Adjustments to tax charge in respect of previous periods

-

642

Adjustments to tax charge in respect of change in rate

-

6,342

Group relief

(30,358

)

-

Total tax charge

20,112

162,301

9.

DIVIDENDS

Period

1.11.17

to

Year Ended

30.6.18

31.10.17

£

£

Ordinary A shares of 0.01 each

Interim

307,500

20,000

Ordinary B shares of 0.01 each

Interim

307,500

20,000

615,000

40,000

10.	TANGIBLE FIXED ASSETS

Fixtures

Long

and

Motor

Computer

leasehold

fittings

vehicles

equipment

Totals

£

£

£

£

£

COST

At 1 November 2017

176,113

193,351

61,693

24,382

455,539

Additions

-

9,900

-

-

9,900

Disposals

(176,113

)

-

-

-

(176,113

)

At 30 June 2018

-

203,251

61,693

24,382

289,326

DEPRECIATION

At 1 November 2017

28,221

190,939

48,703

20,868

288,731

Charge for period

-

1,362

1,624

886

3,872

Eliminated on disposal

(28,221

)

-

-

-

(28,221

)

At 30 June 2018

-

192,301

50,327

21,754

264,382

NET BOOK VALUE

At 30 June 2018

-

10,950

11,366

2,628

24,944

At 31 October 2017

147,892

2,412

12,990

3,514

166,808

11.

DEBTORS

2018

2017

£

£

Amounts falling due within one year:

Trade debtors

71,236

121,203

Amounts owed by group undertakings

77,405

-

Other debtors

1,493,640

290,729

Directors' current accounts

-

133,640

Prepayments and accrued income

141,891

31,203

1,784,172

576,775

Amounts falling due after more than one year:

Amounts owed by group undertakings

-

4,521,284

Aggregate amounts

1,784,172

5,098,059

12.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2018

2017

£

£

Trade creditors

6,211

33,853

Amounts owed to group undertakings

394,000

-

Tax

186,903

162,662

Social security and other taxes

35,989

33,190

Other creditors

61,814

201,267

Accruals and deferred income

236,780

99,826

921,697

530,798