Arrowmere Capital 1 Limited - Accounts to registrar (filleted) - small 18.2

REGISTERED NUMBER: 06823546 (England and Wales)

Financial Statements

for the Year Ended 31 December 2019

for

Arrowmere Capital 1 Limited

Page

Company Information

1

Balance Sheet

2

Notes to the Financial Statements

3

DIRECTORS:

S J Ashworth

J Black

H P Hill

A C Park

M S Bint

S D Ashworth

REGISTERED OFFICE:

Bridge Street Chambers

72 Bridge Street

Manchester

M3 2RJ

REGISTERED NUMBER:

06823546 (England and Wales)

AUDITORS:

Mitten Clarke Audit Limited

Statutory Auditors

The Glades

Festival Way

Stoke on Trent

Staffordshire

ST1 5SQ

FIXED ASSETS

Investment property

5

10,490,000

8,407,000

CURRENT ASSETS

Debtors

6

867,954

543,857

Cash at bank

238,639

222,588

1,106,593

766,445

CREDITORS

Amounts falling due within one year

7

6,643,099

1,001,055

NET CURRENT LIABILITIES

(5,536,506

)

(234,610

)

TOTAL ASSETS LESS CURRENT LIABILITIES

4,953,494

8,172,390

CREDITORS

Amounts falling due after more than one year

8

-

(4,666,200

)

PROVISIONS FOR LIABILITIES

9

(690,744

)

(442,224

)

NET ASSETS

4,262,750

3,063,966

CAPITAL AND RESERVES

Called up share capital

10

100

100

Retained earnings

11

4,262,650

3,063,866

SHAREHOLDERS' FUNDS

4,262,750

3,063,966

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

In accordance with Section 444 of the Companies Act 2006, the Income Statement has not been delivered.

The financial statements were approved and authorised for issue by the Board of Directors and authorised for issue on 7 October 2020 and were signed on its behalf by:

S J Ashworth - Director

A C Park - Director

1.	STATUTORY INFORMATION

Arrowmere Capital 1 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.

2.	STATEMENT OF COMPLIANCE

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" including the provisions of Section 1A "Small Entities" and the Companies Act 2006.

3.	ACCOUNTING POLICIES

Basis of preparing the financial statements

The financial statements are prepared in sterling, which is the functional currency of the company.

Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention, modified to

include the revaluation of investment properties and certain financial instruments at fair value. The

principal accounting policies adopted are set out below.

Going Concern

At the time of approving the financial statements, the directors have a reasonable expectation that

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

future. Thus the directors continue to adopt the going concern basis of accounting in preparing the

financial statements.

Significant judgements and estimates

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 the future periods where the

revision affects both current and future periods.

Crucial judgements

The following judgements (apart from those involving estimates) have had the most significant

effect on amounts recognised in the financial statements.

Valuation of investment property

Investment property is measured using the fair value model and as such requires significant

judgement from the directors. The valuation has been based on the directors knowledge of the

portfolio of investment properties taking account of geographical locations, estimated rental values

and external valuations undertaken in the period.

Turnover

Turnover comprises revenue recognised by the company in respect of property rental income

(comprising rents, service charge and insurance rents) accounted for on an accruals basis, net of

VAT.

Investment property

Investment property, which is property held to earn rentals and/or for capital appreciation, is

measured using the fair value model and stated at its fair value at the reporting end date. The

surplus or deficit on revaluation is recognised in the profit and loss account. Deferred tax is

provided on these gains at the rate expected to apply when the property is sold.

Where fair value cannot be achieved without undue cost or effort, investment property is accounted

for as tangible fixed assets.

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.

Basic financial liabilities

Basic financial liabilities, including creditors, bank loans and loans from fellow group companies,

are initially recognised at transaction price unless the arrangement constitutes a financing

transaction, where the debt instrument is measured at the present value of the future payments

discounted at a market rate of interest. Financial liabilities classified as payable within one year

are not amortised.

Debt instruments are subsequently carried at amortised cost, using the effective interest rate

method.

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary

course of business from suppliers. Amounts payable are classified as current liabilities if payment is

due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are

recognised initially at transaction price and subsequently measured at amortised cost using the

effective interest method.

Derecognition of financial liabilities

Financial liabilities are derecognised when the company's contractual obligations expire or are

discharged or cancelled.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the 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.

4.	EMPLOYEES AND DIRECTORS

The average number of employees during the year was NIL (2018 - NIL).

5.	INVESTMENT PROPERTY

Total

£

FAIR VALUE

At 1 January 2019

8,407,000

Additions

775,000

Revaluations

1,308,000

At 31 December 2019

10,490,000

NET BOOK VALUE

At 31 December 2019

10,490,000

At 31 December 2018

8,407,000

The fair value of the investment property has been determined by the directors of the company on

an open market value for existing use basis. The valuation has been based on the the directors

knowledge of the portfolio of investment properties taking account of the geographical locations

and their estimated rental value.

The company's investment properties were last valued in September 2019 by an external

professional valuer. The third party valuation is not materially different to the value included in the

financial statements.

6.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2019

2018

£

£

Trade debtors

84,721

88,647

Amounts owed by group undertakings

671,490

445,110

Other debtors

101,743

100

Prepayments and accrued income

10,000

10,000

867,954

543,857

7.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2019

2018

£

£

Bank loans and overdrafts

5,441,400

167,000

Trade creditors

316,775

229,228

Amounts owed to group undertakings

355,443

57,432

Corporation tax

13,662

138,439

Social security and other taxes

-

2,558

Other creditors

83,155

58,159

Accruals and deferred income

432,664

348,239

6,643,099

1,001,055

Bank loans of £5,441,400 (2018: £167,000) disclosed under creditors falling due within one year

were secured by the company by way of a first legal mortgage and a first fixed charge over the

property of the company.

8.

CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR

2019

2018

£

£

Bank loans

-

4,666,200

Bank loans of £Nil (2018: £4,666,200) disclosed under creditors falling due after more than one year

were secured by the company by way of a first legal mortgage and a first fixed charge over the

property of the company.

9.	PROVISIONS FOR LIABILITIES

2019

2018

£

£

Deferred tax

690,744

442,224

Deferred

tax

£

Balance at 1 January 2019

442,224

Provided during year

248,520

Balance at 31 December 2019

690,744

10.	CALLED UP SHARE CAPITAL

Allotted, issued and fully paid:

Number:

Class:

Nominal

2019

2018

value:

£

£

100

Ordinary Shares

1

100

100

11.

RESERVES

Included within profit and loss reserves are non-distributable reserves of £3,294,398 (2018:

£2,234,918).

12.	DISCLOSURE UNDER SECTION 444(5B) OF THE COMPANIES ACT 2006

The Report of the Auditors was unqualified.

We draw attention to Note 14 of the financial statements which describes the impact of post

balance sheet events on the company and the directors' assessment of the going concern status of

the company. Our opinion is not modified in this respect.

Lindsey Shepherd (Senior Statutory Auditor)

for and on behalf of Mitten Clarke Audit Limited

13.	ULTIMATE PARENT COMPANY

The company is a 100% owned subsidiary of Arrowmere Holdings Limited, which is the ultimate

parent company. The ultimate parent company prepares consolidated financial statements as at 31

December 2019 and these financial statements may be obtained from Bridge Street Chambers, 72

Bridge Street, Manchester, M3 2RJ.

14.	POST BALANCE SHEET EVENT- PROPERTY PURCHASE

Following the year end a property was purchased for £460,000. The purchase was wholly funded by

additional bank funding.

CORONAVIRUS OUTBREAK

In March 2020 the UK was impacted by the outbreak of the Coronavirus. In order to manage the

spread of the virus the Government has imposed restrictions on the movement of people and the

ability of businesses to continue to trade. The company has determined that these events are

non-adjusting subsequent events. Accordingly, the financial position and results of operations as of

and for the year ended 31 December 2019 have not been adjusted.

The duration and impact of the Coronavirus pandemic, as well as the effectiveness of government

and central bank responses, remains unclear at this time. It is not possible to reliably estimate the

duration and severity of these consequences, as well as their impact on the financial position and

results of the company for future periods.

In the post balance sheet period the company was given a capital repayment holiday by the lender

for two quarters. In addition the company has taken advantage of the VAT deferment scheme.