Little Elms Daycare Nursery Pro Hold Ltd - Limited company accounts 18.2

REGISTERED NUMBER: 08713949 (England and Wales)

LITTLE ELMS DAYCARE NURSERIES PROPERTY

HOLDING COMPANY LIMITED

GROUP STRATEGIC REPORT,

REPORT OF THE DIRECTORS AND

CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 MAY 2019

Page

Company information

1

Group strategic report

2

Report of the directors

3

Report of the independent auditors

4

Consolidated income statement

6

Consolidated other comprehensive income

7

Consolidated balance sheet

8

Company balance sheet

9

Consolidated statement of changes in equity

10

Company statement of changes in equity

11

Consolidated cash flow statement

12

Notes to the consolidated cash flow statement

13

Notes to the consolidated financial statements

14

DIRECTORS:

M Lancaster

S Lancaster

REGISTERED OFFICE:

Lygon House

50 London Road

Bromley

Kent

BR1 3RA

REGISTERED NUMBER:

08713949 (England and Wales)

AUDITORS:

F W Berringer & Co

Chartered Accountants

and Statutory Auditors

Lygon House

50 London Road

Bromley

Kent

BR1 3RA

The directors present their strategic report of the company and the group for the year ended 31 May 2019.

REVIEW OF BUSINESS

The principal activity of the group during the year under review was that of the daycare nursery services.

RESULTS

The results for the year and financial position of the company and the group are shown in the annexed financial statements.

Group turnover has increased from £6,123,616 in 2018 to £7,016,989.

The post tax group profit for the year stood at £659,769, compared to £743,609 in 2018.

Net assets have increased to £3,436,855 from £2,892,086.

KEY PERFORMANCE INDICATORS

There are key performance indicators to be considered, both financial and non-financial; An increase in turnover, improvement in

efficiencies and a happier workforce.

PRINCIPAL RISKS AND UNCERTAINTIES

The group operates in a sophisticated market and its performance is related to ensuring it provides a high quality of childcare to

satisfy all of its customers requirements.

The main financial risks arising from the group's activities are credit risk, interest rate risk and liquidity risk. These are monitored

by the directors.

ON BEHALF OF THE BOARD:

M Lancaster - Director

27 February 2020

The directors present their report with the financial statements of the company and the group for the year ended 31 May 2019.

DIVIDENDS

An interim dividend of 7.554p per share was paid on 31 March 2019. The directors recommend that no final dividend be paid.

The total distribution of dividends for the year ended 31 May 2019 will be £ 115,000 .

DIRECTORS

The directors shown below have held office during the whole of the period from 1 June 2018 to the date of this report.

M Lancaster

S Lancaster

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Group 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 the group and of the profit or

loss of the group 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 and the

group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group 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 the group 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 group's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to

make himself aware of any relevant audit information and to establish that the group's auditors are aware of that information.

AUDITORS

The auditors, F W Berringer & Co, will be proposed for re-appointment at the forthcoming Annual General Meeting.

ON BEHALF OF THE BOARD:

M Lancaster - Director

27 February 2020

Opinion

We have audited the financial statements of Little Elms Daycare Nurseries Property Holding Company Limited (the 'parent

company') and its subsidiaries (the 'group') for the year ended 31 May 2019 which comprise the Consolidated income statement,

Consolidated other comprehensive income, Consolidated balance sheet, Company balance sheet, Consolidated statement of changes

in equity, Company statement of changes in equity, Consolidated cash flow statement and Notes to the consolidated cash flow

statement, 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 group's and of the parent company affairs as at 31 May 2019 and of the group's 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 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 group 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 group'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 Group 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.

Opinions 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 Group 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 Group 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 group and the parent company and its environment obtained in the course of

the audit, we have not identified material misstatements in the Group 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 by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or

-	the parent company 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 three, 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 group's and the parent 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 group or the parent 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.

Paul Allan BSocSc FCA (Senior Statutory Auditor)

for and on behalf of F W Berringer & Co

Chartered Accountants

and Statutory Auditors

Lygon House

50 London Road

Bromley

Kent

BR1 3RA

27 February 2020

TURNOVER

7,016,989

6,123,616

Cost of sales

3,708,619

3,200,072

GROSS PROFIT

3,308,370

2,923,544

Administrative expenses

2,635,129

2,102,139

673,241

821,405

Other operating income

-

75,000

OPERATING PROFIT

4

673,241

896,405

Intercompany loan write off

5

113,362

-

786,603

896,405

Interest receivable and similar income

6

5

786,609

896,410

Interest payable and similar expenses

6

8,280

4,598

PROFIT BEFORE TAXATION

778,329

891,812

Tax on profit

7

118,560

148,203

PROFIT FOR THE FINANCIAL YEAR

659,769

743,609

Profit attributable to:

Owners of the parent

659,769

743,609

PROFIT FOR THE YEAR

659,769

743,609

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

659,769

743,609

Total comprehensive income attributable to:

Owners of the parent

659,769

743,609

FIXED ASSETS

Tangible assets

10

3,197,561

2,922,833

Investments

11

-

-

3,197,561

2,922,833

CURRENT ASSETS

Debtors

12

4,707,819

2,434,478

Cash at bank and in hand

508,625

410,632

5,216,444

2,845,110

CREDITORS

Amounts falling due within one year

13

4,061,633

2,726,804

NET CURRENT ASSETS

1,154,811

118,306

TOTAL ASSETS LESS CURRENT LIABILITIES

4,352,372

3,041,139

CREDITORS

Amounts falling due after more than one year

14

(905,517

)

(139,053

)

PROVISIONS FOR LIABILITIES

18

(10,000

)

(10,000

)

NET ASSETS

3,436,855

2,892,086

CAPITAL AND RESERVES

Called up share capital

19

1,522,202

1,522,202

Retained earnings

20

1,914,653

1,369,884

SHAREHOLDERS' FUNDS

3,436,855

2,892,086

The financial statements were approved by the Board of Directors on 27 February 2020 and were signed on its behalf by:

M Lancaster - Director

S Lancaster - Director

FIXED ASSETS

Tangible assets

10

1,858,089

1,800,132

Investments

11

1,522,600

1,522,600

3,380,689

3,322,732

CURRENT ASSETS

Debtors

12

2,382,547

1,027,944

CREDITORS

Amounts falling due within one year

13

4,206,749

2,770,598

NET CURRENT LIABILITIES

(1,824,202

)

(1,742,654

)

TOTAL ASSETS LESS CURRENT LIABILITIES

1,556,487

1,580,078

CAPITAL AND RESERVES

Called up share capital

19

1,522,202

1,522,202

Retained earnings

34,285

57,876

SHAREHOLDERS' FUNDS

1,556,487

1,580,078

Company's profit for the financial year

91,409

48,790

The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime.

The financial statements were approved by the Board of Directors on 27 February 2020 and were signed on its behalf by:

M Lancaster - Director

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 June 2017

1,522,202

626,275

2,148,477

Changes in equity

Total comprehensive income

-

743,609

743,609

Balance at 31 May 2018

1,522,202

1,369,884

2,892,086

Changes in equity

Dividends

-

(115,000

)

(115,000

)

Total comprehensive income

-

659,769

659,769

Balance at 31 May 2019

1,522,202

1,914,653

3,436,855

Called up

share

Retained

Total

capital

earnings

equity

£

£

£

Balance at 1 June 2017

1,522,202

9,086

1,531,288

Changes in equity

Total comprehensive income

-

48,790

48,790

Balance at 31 May 2018

1,522,202

57,876

1,580,078

Changes in equity

Dividends

-

(115,000

)

(115,000

)

Total comprehensive income

-

91,409

91,409

Balance at 31 May 2019

1,522,202

34,285

1,556,487

Cash flows from operating activities

Cash generated from operations

1

666,919

1,458,264

Interest paid

(8,280

)

(4,598

)

Tax paid

(148,202

)

(130,169

)

Net cash from operating activities

510,437

1,323,497

Cash flows from investing activities

Purchase of tangible fixed assets

(385,981

)

(258,325

)

Sale of tangible fixed assets

25

-

Interest received

6

5

Net cash from investing activities

(385,950

)

(258,320

)

Cash flows from financing activities

New loans in year

900,000

-

Loan repayments in year

(44,574

)

(24,023

)

Amount withdrawn by directors

(766,920

)

(967,834

)

Equity dividends paid

(115,000

)

-

Net cash from financing activities

(26,494

)

(991,857

)

Increase in cash and cash equivalents

97,993

73,320

Cash and cash equivalents at beginning of year

2

410,632

337,312

Cash and cash equivalents at end of year

2

508,625

410,632

1.	RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

2019

2018

£

£

Profit before taxation

778,329

891,812

Depreciation charges

111,252

96,336

Profit on disposal of fixed assets

(25

)

-

Finance costs

8,280

4,598

Finance income

(6

)

(5

)

897,830

992,741

(Increase)/decrease in trade and other debtors

(1,506,420

)

38,713

Increase in trade and other creditors

1,275,509

426,810

Cash generated from operations

666,919

1,458,264

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Cash flow statement in respect of cash and cash equivalents are in respect of these Balance

sheet amounts:

Year ended 31 May 2019

31.5.19

1.6.18

£

£

Cash and cash equivalents

508,625

410,632

Year ended 31 May 2018

31.5.18

1.6.17

£

£

Cash and cash equivalents

410,632

337,312

1.	STATUTORY INFORMATION

Little Elms Daycare Nurseries Property Holding Company 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 General

Information page.

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.

Basis of consolidation

The consolidated financial statements, incorporate the financial statements of the company and all of its subsidiaries for the

year ended 31 May 2019.

The group accounts for the year have been prepared under the acquisition accounting method.

Going concern

After reviewing the company's forecasts and projections, the directors have reasonable expectation that the group has

adequate resources to continue in operational existence for the foreseeable future. The group therefore continues to adopt

the going concern basis in preparing its consolidated financial statements.

Significant judgements and estimates

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect

the amounts reported for assets and liabilities as at the balance sheet date and the amounts reported for revenues and

expenditures during the year. However, the nature of estimation means that actual outcomes could differ from those

estimates. Management do not consider that there is significant risk of causing a material adjustment to the carrying

amounts of assets and liabilities within the next financial period.

Turnover

Turnover is attributable to the principal activity of the group, and relates to nursery fees received, which are recognised in

the profit and loss account by reference to the period they relate to. Fees received in advance are included within deferred

income and are released to the profit and loss account once the group has fulfilled its obligations to the customer.

Tangible fixed assets

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

Short leasehold

-

Straight line over 10 years

Improvements to property

-

not provided, over period of lease and Straight line over 10 years

Furniture and equipment

-

20% on cost and at varying rates on cost

Fixtures and fittings

-

20% on cost

The properties and improvements to properties are included in the financial statements at valuation provided by the recent

purchases of the properties by the company. The directors have measured properties held by the companies that are rented

to other group members by reference to cost, rather than fair value.

No depreciation is provided in respect of the freehold properties. This departure from the requirements of the Companies

Act 2006, for all properties to be depreciated, is, in the opinion of the directors, necessary for the financial statements to

give a true and fair view in accordance with applicable accounting standards as the properties are included in the financial

statements at the appropriate value. The properties will maintain a long useful economic life and residual value through the

policy of regular maintenance and repair (charges for which are recognised in the profit and loss account) such that the

assets are kept to the previously assessed levels.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Consolidated Income Statement, 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 year 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.

Investments

Investments are stated at cost less any provision for a permanent diminution in value.

3.	EMPLOYEES AND DIRECTORS

2019

2018

£

£

Wages and salaries

4,251,284

3,605,134

Social security costs

220,753

298,067

4,472,037

3,903,201

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

2019

2018

Nursery

215

201

Administration

43

42

258

243

2019

2018

£

£

Directors' remuneration

23,631

23,617

4.	OPERATING PROFIT

The operating profit is stated after charging/(crediting):

2019

2018

£

£

Depreciation - owned assets

111,253

96,337

Profit on disposal of fixed assets

(25

)

-

Auditors remuneration

16,861

18,288

5.	EXCEPTIONAL ITEMS

2019

2018

£

£

Intercompany loan write off

113,362

-

Included in exceptional items is an amount written off from City West Support Services Limited, a related party due to

directors and shareholders in common.

6.

INTEREST PAYABLE AND SIMILAR EXPENSES

2019

2018

£

£

Bank loan interest

8,280

4,598

7.

TAXATION

Analysis of the tax charge

The tax charge on the profit for the year was as follows:

2019

2018

£

£

Current tax:

UK corporation tax

118,560

148,203

Tax on profit

118,560

148,203

8.	INDIVIDUAL INCOME STATEMENT

As permitted by Section 408 of the Companies Act 2006, the Income statement of the parent company is not presented as

part of these financial statements.

9.

DIVIDENDS

2019

2018

£

£

Interim

115,000

-