BROADFIELD_COURT_LLP - Accounts

The members of the limited liability partnership have elected not to include a copy of the profit and loss account within the financial statements.

These financial statements have been prepared and delivered in accordance with the provisions applicable to limited liability partnerships subject to the small limited liability partnerships regime.

No restrictions or limitations exist on the ability of the members to reduce the amount of 'Members' other interests'.

Broadfield Court LLP is a limited liability partnership incorporated in England and Wales. The registered office is Acre House, 11-15 William Road, London, United Kingdom, NW1 3ER.

The limited liability partnership's principal activities are disclosed in the Members' Report.

These financial statements have been prepared in accordance with the Statement of Recommended Practice "Accounting by Limited Liability Partnerships" issued in December 2018, together 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 as applicable to limited liability partnerships subject to the small limited liability partnerships regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.

The financial statements are prepared in sterling, which is the functional currency of the limited liability partnership. 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 investment properties at fair value. The principal accounting policies adopted are set out below.

The members have considered the effect of the Covid-19 outbreak, on the limited liability partnership’s activities. The outbreak has caused little disruption to the limited liability partnership’s business to date. The members have determined that a degree of uncertainty exists in relation to the ability of its' tenants to fulfil their rental and other obligations however, since the Covid-19 outbreak, the members have been in contact with their tenants and are of the opinion that the majority of their rents over the next 12 months will be received. To date, they have not experienced significant difficulties in receiving rental amounts due from tenants.

The members consider it unlikely that a prolonged outbreak will cause significant disruption.

The limited liability partnership has also refinanced its non bank loans which were expected to mature on 25 October 2020 post year end.

Accordingly, at the time of approving the financial statements, the members have a reasonable expectation that the limited liability partnership has adequate resources to continue in operation for the foreseeable future with the support of companies under common control who have committed to not seeking repayment of loans due unless sufficient cash and resources are available and to provide cash support should it be required. Thus the members continue to adopt the going concern basis of accounting in preparing the financial statements.

Turnover represents rental income, property insurance premiums, service charges receivable and dilapidations receivable excluding value added tax.

Recognition of rental income takes into account the terms of the lease including any lease incentives which are spread over the length of the lease.

Property insurance premiums and service charges receivable are recognised over the period it relates to. Where the tenant pays in advance, the limited liability partnership defers that amount and recognises it as turnover over the period it relates to on a straight line basis.

Where the right to consideration arises from the occurrence of a critical event the turnover is recognised when the event occurs.

Members' participation rights are the rights of a member against the LLP that arise under the members' agreement (for example, in respect of amounts subscribed or otherwise contributed, remuneration and profits).

Members' participation rights in the earnings or assets of the LLP are analysed between those that are, from the LLP's perspective, either a financial liability or equity, in accordance with section 22 of FRS 102. A member's participation rights including amounts subscribed or otherwise contributed by members, for example members' capital, are classed as liabilities unless the LLP has an unconditional right to refuse payment to members, in which case they are classified as equity.

All amounts due to members that are classified as liabilities are presented within 'Loans and other debts due to members'. Amounts recoverable from members are presented as debtors and shown as amounts due from members within members’ interests.

Profits are automatically divided as they arise, so the LLP does not have an unconditional right to refuse payment and the amounts arising that are due to members are in the nature of liabilities. They are therefore treated as an expense and presented as members remuneration charged as an expense in arriving at the result for the relevant year. To the extent that they remain unpaid at the period end, they are shown as liabilities.

Investment property, which is property held to earn rentals and/or for capital appreciation, is initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Subsequently it is measured at fair value at the reporting end date. The surplus or deficit on revaluation is recognised in profit or loss.

The limited liability partnership 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 limited liability partnership's balance sheet when the limited liability partnership becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset and 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, 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.

Financial assets, are assessed for indicators of impairment at each reporting end date.

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 limited liability partnership after deducting all of its liabilities.

Basic financial liabilities, including creditors, non bank loans and loans and other debts due to members, 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.

The limited liability partnership does not currently have any equity.

The taxation payable on the partnership profits is solely the personal liability of the individual members consequently neither partnership taxation nor related deferred taxation arising in respect of the partnership are accounted for in these financial statements.

In the application of the limited liability partnership’s accounting policies, the members 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.

The following judgements (apart from those involving estimates) have had the most significant effect on amounts recognised in the financial statements.

Investment properties are valued at fair value with changes in fair value being recognised in the profit and loss account. The fair value of the investment properties have been arrived at on the basis of a valuation carried out in July 2020 by Knight Frank LLP Chartered Surveyors. The members do not consider there to be any material changes to the fair value of the investment properties from the balance sheet date and July 2020 when the valuation took place and therefore believe the fair value of the investment properties recognised in the accounts is not materially misstated. Making this assessment requires judgements to be made by the members by reference to market conditions.

The fair value of the investment properties have been arrived at on the basis of a valuation carried out in July 2020 by Knight Frank LLP Chartered Surveyors, who are not connected with the limited liability partnership. The valuation has been carried out using the investment method whereby market values of the freehold and leasehold interests in the properties have been derived, subject to existing tenancies and taking into account comparable investment and rental transactions, together with evidence of demand within the vicinity of the subject properties.

The members do not consider there to be any material changes to the fair value of the investment properties from the balance sheet date and July 2020 when the valuation took place and therefore believe the fair value of the investment properties recognised in the accounts is not materially misstated.

Included within other debtors is £190,638 (2019: £137,603) due from a related company. This amount is unsecured, interest free and repayable on demand.

The non bank loans of £1,019,892 (2019: £18,650) are secured by a legal charge over the assets of the partnership, as well as by a cross-guarantee given by other companies under the control of the members as described in note 9. A market rate of interest is charged by the lenders on the non bank loans and is payable quarterly. The maturity date of the non bank loans is 25 October 2020.

On 17 September 2020, the company refinanced its non bank loans which were due to mature on 25 October 2020. The new maturity date of the non bank loans is 17 September 2025.

After the refinancing on 17 September 2020, the LLP had non bank loans of £1,141,719.  These are secured by a legal charge over the assets of the partnership, as well as by a cross-guarantee given by other companies under the control of the members.  A market rate of interest is charged by the lenders on the non bank loans and interest is payable quarterly.  The principal amount of the non bank loans is repaid on maturity.

In the event of a winding up the amounts included in "Loans and other debts due to members" will rank equally with unsecured creditors.

The limited liability partnership has given cross party guarantees with related entities for non bank loans provided to these entities. At the balance sheet date the amount owed to lenders by these related entities for the non bank loans was £40,901,233 (2019: £41,244,749).

The non bank loans due for maturity on 25 October 2020 were refinanced on 17 September 2020, see note 6 for further details.

As the profit and loss account has been omitted from the filing copy of the financial statements the following information in relation to the audit report on the statutory financial statements is provided in accordance with s444(5B) of the Companies Act 2006 (as applied by The Limited Liability Partnerships (Accounts and Audit) (Application of Companies Act 2006) Regulations 2008):

The auditor's report was unqualified.