PEARMAIN_PUBS_LTD - Accounts

The directors present the strategic report for the period ended 12 March 2020.

The principal activity of the company continued to be that of the management of public houses and restaurants.

The directors aim to present a balanced and comprehensive review of the development and performance of the business during the period and its position at the period end. This review is consistent with the size of the business.

Our primary KPI is considered to be turnover which is derived from the management of public houses and restaurants. There has been a growth in turnover in the period which is due to a full period of trade for one of the public houses which opened during the period along with growth across all other sites. The financial statements for the current period represent an additional two and a half months of trade however, the increase in turnover has comparably increased by 10% from the prior period.

The secondary KPI is profitability. The directors are satisfied with the increase in the profit margin in the period shown in the profit and loss account on page 7 of the accounts.

The positive results achieved in 2020 are not only a result of continued monitoring of costs and management continually seeking ways to improve on the margins being achieved but also due to the continued delivery of excellent customer service which can only be achieved with the help of all of our employees.

The balance sheet remains strong which is partly due to good cash management and keeping retained earnings in the company for future development. During the period under review we disposed of four leasehold properties and one freehold property which were used for business operations, as detailed in note 11 and this is the reason for the significant decrease in respect of the balance sheet position at the period end.

The company is exposed to financial risk through its financial assets and liabilities. The key financial risk is that the proceeds from financial assets are not sufficient to fund the obligations arising from liabilities as they fall due. Due to the nature of the company's business and the assets and liabilities contained within the company's balance sheet the directors consider that the major risk relevant to the company is cash flow risk.

Cash forecasts identifying the company's liquidity requirements are produced and reviewed regularly by management and any risk is managed centrally.

After making enquires the directors have a reasonable expectation that the company has adequate resources to continue in business for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the financial statements.

The directors have considered the effect that the ongoing COVID-19 pandemic may have on the business and consideration of this has been included in the directors' report.

The company operates in a market where competition is strong, however the company manages this risk by providing a consistently high standard to its clients.

The company is cognisant of the importance of their employees in the delivery of excellent customer service and the company’s policy is to consult and discuss with employees matters likely to affect the employees’ interests.

Information of matters of concern to employees is given through information bulletins which seek to achieve a common awareness on the part of all employees of the financial and economic factors affecting the company’s performance.

The company operates an employee share option scheme and an employee loyalty scheme as a means of encouraging the employees to help build on the company’s performance and profitability.

The directors continue to look for further suitable sites to acquire in order to continue to grow the business.

On behalf of the board

The directors present their annual report and financial statements for the period ended 12 March 2020.

The directors who held office during the period and up to the date of signature of the financial statements were as follows:

The results for the period are set out on page 7.

Ordinary dividends were paid amounting to £7,530,191. The directors do not recommend payment of a final dividend.

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.

The company's policy is to consult and discuss with employees, through unions, staff councils and at meetings, matters likely to affect employees' interests.

Information about matters of concern to employees is given through information bulletins and reports which seek to achieve a common awareness on the part of all employees of the financial and economic factors affecting the company's performance.

An employee loyalty scheme remains in place as a means of encouraging the employees to help build on the company's performance and profitability.

The financial statements have been prepared on a going concern basis. The COVID-19 pandemic has had a material impact on the business due to the company being an operator of public houses and restaurants. Subsequent to the period end, restrictions have been imposed by the UK government which caused all sites to close initially between 23 March 2020 and 4 July 2020 and again between 5 November 2020 and 2 December 2020 and during this time the company was unable to trade. In particular, in response to the COVID-19 pandemic, the Directors have reviewed and considered relevant information, including their post year end performance and future cash requirements to take into account the impact on their business of possible scenarios brought on by the impact of COVID-19, alongside the measures that they can take to mitigate the impact. Based on these assessments, given the measures that could be undertaken to mitigate the current adverse conditions, and the current resources available, the Directors have concluded that they can continue to adopt the going concern basis in preparing the annual report and financial statements.

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;

•     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.

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.

We have audited the financial statements of Pearmain Pubs Ltd (the 'company') for the period ended 12 March 2020 which comprise 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 the financial statements:

•     give a true and fair view of the state of the company's affairs as at 12 March 2020 and of its profit 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 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 opinion.

Material uncertainty relating to going concern

We draw your attention to note 1.2 of the financial statements, which indicates that the company’s ability to continue as a going concern is dependent on policies which may be implemented by the UK government in response to the COVID-19 pandemic. Should the UK government make the decision to implement further total closures of public houses and restaurants in order to curtail the COVID-19 pandemic, then a material uncertainty may emerge that could cast doubt on the company’s ability to continue as a going concern.

Our audit opinion is not modified in this respect.

Other information

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' report for the financial period 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.

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 and the directors' report.

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.

As explained more fully in the directors' responsibilities statement, 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.

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.

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 an auditor's report 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.

Pearmain Pubs Ltd is a private company limited by shares incorporated in England and Wales. The registered office is Unit 2B Henley Business Park, Pirbright Road, Normandy, Guildford, Surrey, GU3 2DX.

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 amounts in these financial statements are rounded to the nearest pound.

The financial statements have been prepared under the historical cost convention, modified to include the revaluation of freehold properties. The principal accounting policies adopted are set out below.

The financial statements have been prepared on a going concern basis. The Directors have reviewed and considered relevant information, including the post year end performance company and future cash requirements in making their assessment. The COVID-19 pandemic has had a material impact on the business due to the company being an operator of public houses and restaurants. Subsequent to the period end, restrictions have been imposed by the UK government which caused all sites to close initially between 23 March 2020 and 4 July 2020 and again between 5 November 2020 and 2 December 2020 and during this time the company was unable to trade in any way due to the sites being forced into a total lock down scenario. The company has mitigated the impact of COVID-19 by making use of PAYE and VAT delayed payments, furloughing of underutilised staff and the injection of cash into the company from certain shareholders to ensure it was able to maintain liquidity. The directors consider that these decisions meant that the company was well placed to be able to re-open for business in keeping with guidelines at the time. Subsequently, there has been an easing of the restrictions although there are still restrictions in place in respect of how many patrons can visit and when patrons are permitted to visit the company’s public houses and restaurants and these added restrictions have reduced the amount trade that can be undertaken at each site. Naturally, the unprecedented nature of the pandemic means that any further government policy to curtail the COVID-19 pandemic and the uncertainty of future possible lock down periods cannot be predicted with any degree of certainty and could again have a material impact on the company’s ability to trade. Should public houses and restaurants be forced into a total closure situation for an extended period of time again, at the behest of the government, then this could create a material uncertainty. However, if the company is able to open and operate, albeit at a reduced capacity due to restrictions on patron numbers and household mixing, the company can continue to trade and is expected to be profitable. true

Based on these assessments, given the measures that could be undertaken to mitigate the current adverse conditions, and the current resources available, the Directors have concluded that they can continue to adopt the going concern basis in preparing the annual report and financial statements and that the company has adequate financial resources to continue to trade for at least a period of twelve months from the date of signing these financial statements.

The company extended its accounting reference date so that the sale of some of its operations were included in these financial statements. In the past the company has prepared its financial statements to the Sunday closest to the then 31 December accounting reference date. The period covered by these financial statements is therefore from 31 December 2018 to 12 March 2020. On this basis, comparatives are not entirely comparable as they relate to the period from 1 January 2018 to 30 December 2018.

Turnover represents amounts receivable for goods and services net of VAT and trade discounts. Revenue is recognised on the date the service is provided. Non-refundable deposits received in advance are deferred and recognised on the date the service is provided.

Goodwill represents the excess of the cost of acquisition of public houses and restaurants over the fair value of net assets acquired. Goodwill, intellectual property rights and premises licence are initially recognised as assets at cost and are subsequently measured at cost less accumulated amortisation. Goodwill, intellectual property rights and premises licence are considered to have finite useful life's and are amortised on a systematic basis over their expected life, which is one year.

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:

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.

Interests in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.

At each reporting period end date, the company reviews the carrying amounts of its tangible and intangible 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.

Stocks are stated at the lower of cost and net realisable value.

Cash and cash equivalents are made up of cash held in hand and cash held in the bank.

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.

Basic financial assets, which include debtors and cash and bank balances, are measured at transaction price including transaction costs. 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 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.

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.

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, including creditors and bank loans, are initially recognised at transaction price. Financial liabilities classified as payable within one year are not amortised.

Financial liabilities are derecognised when the company’s contractual obligations expire or are discharged or cancelled.

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.

The tax expense represents the sum of the tax currently payable and deferred tax.

The tax currently payable is based on taxable profit for the period. 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.

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.

Provisions are recognised when the company has a legal or constructive present obligation as a result of a past event, it is probable that the company will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting end date, taking into account the risks and uncertainties surrounding the obligation.

The costs of short-term employee benefits are recognised as a liability and an expense.

The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received.

The company operates an employee share option scheme. The relevant employees are granted share options and have an amount deducted from their salary over a five year period to fund the exercise price. The share options may be exercised on a sale of the company.

The company also operates an employee loyalty bonus scheme whereby the employees loan the company money and have an additional amount deducted from their salary over a three year period. At this date, the relevant employees are entitled to an additional fixed bonus on remaining in the scheme.

The monthly employee contributions made to the company during the scheme periods, are included within creditors due within one year as these contributions are repaid to employees on termination of employment or can be returned at any point if requested by the employee.

The company operates a defined contribution scheme for the benefit of its employees. Contributions payable are charged to the profit and loss account in the period they are payable.

Rentals payable under operating leases, including any lease incentives received, are charged to income on a straight line basis over the term of the relevant lease.

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

Due to the significance of the depreciation charged in the financial statements, the directors consider this to be a crucial accounting judgement. An assessment is made of the useful economic lives, taking into account residual values of the tangible assets, based on the directors' knowledge and industry experience. There are periodic reviews to determine if depreciation rates are still appropriate and whether any impairment is needed.

An analysis of the company's turnover is as follows:

The average monthly number of persons (including directors) employed by the company during the period was:

Their aggregate remuneration comprised:

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 3 (2018 - 5).

The number of directors who exercised share options during the period was 1 (2018 - 0).

The directors are considered to be the key management personnel.

The actual charge for the period can be reconciled to the expected charge for the period based on the profit or loss and the standard rate of tax as follows:

On 11 March 2020 the company entered into a sale agreement to dispose of four leasehold properties and one freehold property used for business operations. The sale was completed on 11 March 2020. Prior to disposal, the net book value of the assets transferred to a parent company through a dividend in specie.

The current period figures have been spilt between continuing and discontinuing operations to reflect the sale of the properties above.

Land and buildings with a carrying amount of £932,625 were revalued at 31 December 2019 by Fleurets, independent valuers not connected with the company on the basis of market value. The valuation conforms to International Valuation Standards and was based on recent market transactions on arm's length terms for similar properties.

If revalued assets were stated on an historical cost basis rather than a fair value basis, the total amounts included would have been as follows:

The company acquired 100% of the share capital of The Canbury Arms Limited, a company incorporated in England and Wales, on 26 March 2019, and disposed of 100% of the share capital on 11 March 2020 as part of the disposal as detailed in note 11.

Included in other debtors is an amount of £141,725 (2018 - £201,150) in respect of deposits on leasehold properties which will not be recoverable within 12 months.

The bank loan of £989,871 (2018 - £1,182,288) is secured by a debenture over the undertaking and all property and assets. There is also a fixed and floating legal charge over all assets of the company, including the company's leasehold land and buildings.

A cross guarantee and debenture was in place between the company and The Canbury Arms Limited, a previously held wholly owned subsidiary, at the period end. As part of the disposal, as detailed in note 11, this has subsequently been satisfied post year end along with all other securities held against assets that are no longer held by the company as at the period end.

The following are the major deferred tax liabilities and assets recognised by the company and movements thereon:

The deferred tax liability set out above may not reverse within 12 months.

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.

On 3 April 2019 the 'B1' and 'B2' shares were purchased by the company and immediately cancelled.

During the period a further 125,405,271 'A' Ordinary shares of 1p each and 29,261,229 'C' Ordinary shares of 1p each were issued and subsequently cancelled. An additional 6,000 'C' Ordinary shares of 1p each were also issued.

During the period the 30,000 'A' Ordinary shares of 1p each were subdivided into 300,000 'A' Ordinary shares of 0.01p each. These were then re-designated as 60,000 Ordinary 'RA' and 240,000 Ordinary 'TA' shares of 0.01p each. The 240,000 Ordinary 'TA' shares of 0.01p each were subsequently cancelled.

During the period end the 13,000 'C' Ordinary shares of 1p each were subdivided into 130,000 'C' Ordinary shares of 0.01p each. These were then re-designated as 26,000 Ordinary 'RC' and 104,000 Ordinary 'TC' shares of 0.01p each. The 104,000 Ordinary 'TC' shares of 0.01p each were subsequently cancelled.

During the period share options of 6,000 (2018 - £nil) 'C' Ordinary shares of 1p each were made available and exercised.

During the period the share options of £22,000 (2018 - 26,000) 'D' Ordinary shares of 1p each were made available but not exercised.

At the reporting end date the company had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

The directors' view on the impact of COVID-19 is disclosed in the directors' report and in the going concern accounting policy.

On 15 May 2020, the company entered into an agreement to cancel and repurchase 6,000 Ordinary RC shares for a total consideration of £6.

During the period, the company paid rent of £192,500 (2018 - £165,000) to a partnership between Pearmain Pubs Limited and Pearmain Pubs Limited SSAS. Included in creditors at the period end is an amount of £nil (2018 - £16,225) owed to Pearmain Pubs Limited SSAS.

Included in debtors at the period end is an amount of £4,425 (2018 - £393,337) owed by Pearmain Pubs Limited SSAS. The movement during the period relates to repayments of £396,332 (2018 - £68,400) and interest charged of £7,420 (2018 - £18,915).

Included in other debtors at the period end is an interest-free loan of £10,000 (2018 - £10,000) owed by C McLeish, related to the director. This loan is repayable on maturity of the Share Save Scheme to which the shareholder contributes.

Dividends totalling £nil (2018 - £499,980) were paid in the period in respect of shares held by the company's directors.

Included in debtors at the period end are interest-free loans of £10,060 (2018 - £10,000) loaned to D McLeish, director. £10,000 of this loan is repayable on maturity of the Share Save Scheme to which the shareholder contributes. The movement during the period relate to expenses paid on behalf of the director of 11,321 (2018 - £9,198), expenses repaid of £11,321 (2018 - £9,783) and an amount of £60 (2018 - £nil) in relation to the exercising of the share options.

Included in creditors at the period end are interest-free loans of £267 (2018 - £19) loaned from A Hancock, director. The movements during the period relate to a loan advance of £135,000 (2018 - £nil), repayments of £135,288 (2018 - £nil).

Included in debtors at the period end are interest-free loans of £720 (2018 - £720) loaned to R Brown, director. The movements during the period related to expenses paid on behalf of the director of £2,075 (2018 - £2,192), loan advance of £165,000 (2018 - £nil) and repayments of £167,074 (2018 - £2,192).

Included in other creditors at the period end is an interest-free loan of £123 (2018 - £nil) owed to T Hancock, director. The movement during the period relates to expenses paid amounting to £1,044 (2018 - £208) and repayments of £921 (2018 - £208).

During the period, the company paid bonuses totalling £487,500 (2018 - £280,000) to the employees in the share option scheme, as detailed in note 1.15, in return for these employees waiving their rights under these options. At the period end an amount of £62,563 (2018 - £194,944) has been accrued for as the expected liability for the payment due to the remainder of the employees in this scheme for which the scheme has not yet vested for which has been based on each employees duration in the scheme and the potential pay out.

At the period end, an amount of £54,375 (2018 - £22,556) has been accrued for as the expected liability for the payment due to the employees in the employee loyalty bonus scheme for which the scheme has not yet vested for which has been based on each employees duration in the scheme and the potential pay out.