BLACK_&_LIZARS_LIMITED - Accounts

The directors present the strategic report for the year ended 30 September 2019.

Black & Lizars continues to position itself as a premium health care provider with an emphasis on clinical expertise, supported by continued investment in technology and complimentary services.

The business underwent significant change through 2019 as it re-focussed its attention to the cities of Glasgow and Edinburgh. These changes culminated in the sale of nine of its outlying Practices in early 2019 and the closure of one further Practice.

As a result, the company's turnover for the year fell to £9.8m from £13.3m in 2018.

Whilst the sale of 9 practices allowed the company to concentrate on its core locations and to repay all external bank debt, the lag between the loss of revenue from the practices sold and reducing the company’s overhead base resulted in the company posting operating losses for the year.

Whilst the losses were largely offset by the gain made on the sale of the practices, which amounted to £1.42m, overall the company posted a pre-tax loss for the year amounting to £0.29m (2018 - £0.18m).

Following the changes made, and on the back of further restructuring as outlined within the Outlook section below, we are confident that the focus we can now bring to a smaller volume of practices in concentrated geographical areas will improve the business in the long term.

2019        2018

£            £    

Turnover                            9.81m         13.31m

Operating loss                         (1.44m)         (0.11m)    

Gain on sale of practices                    1.42m            -    

Loss before tax                         (0.29m)         (0.18m)

At the year end the company had net assets amounting to £3.22m (2018 - £5.66m).

The directors are of the opinion that analysis using financial KPIs, other than those above, is not necessary for an understanding of the development, performance and position of the business.

The principal risks facing the business come from increasing price and promotional competition from existing and new entrants into the optical sector, particularly within the retail environment.

The business is mitigating these risks through the process of identification and investment in new developments within clinical care and is currently pursuing a strategy of investment to ensure continued differentiation and growth.

The company will continue to apply financial and commercial control over its activities to maintain and improve its competitive position, this financial and commercial control process identified the opportunity to divest practices during the year to improve the strength and underlying competitive position.

Further information with regards to the Covid-19 pandemic can be seen in Outlook below.

The current economic environment as a result of the Covid-19 pandemic continues to be challenging. During 2020, government enforced lockdowns saw the business interrupted through enforced closure then emergency appointments only before returning to some form of normality towards the end of the year. During this time, we took advantage of government financial support measures where available, further reduced our operating cost base and managed our working capital and cash flow closely to ensure the business maintained sufficient financial resources throughout.

The company's financial statements for the year to 2020 will reflect a return to profitability. The Practice restructure and costs reductions undertaken have improved the financial strength of the company, which enables it to operate without any bank borrowings.

The above, combined with the government financial support measures in place, has meant that the business has been cash generative post year end and since the start of the pandemic. The sale of one of the company’s investment properties in May 20 further bolstered its cash reserves and at the time of writing, the company’s cash position is particularly healthy and with limited external debt.

Despite the progress made to achieve this position, we acknowledge that company’s results could change depending on how the situation evolves and will assess and respond to any change in risk as appropriate. The duration of the pandemic and government lockdowns, the availability of government financial support measures and the continued impact on general economic activity could all impact the future results of the company.

However, we believe measures we have taken have left the company with a solid base to move forward from and that the outlook for the company remains positive. The focus on a smaller volume of Practices in a smaller geographical spread will ensure that the long term vision of service and clinical excellence will be delivered.

Our financial risk management objectives are to ensure sufficient working capital and cash flow for the company and to ensure there is sufficient support for its strategy. This is achieved through careful management of our cash resources and by obtaining loan finance where necessary. No treasury transactions or derivatives are entered into.

On behalf of the board

The directors present their annual report and financial statements for the year ended 30 September 2019.

The principal activity of the company continued to be that of the provision of ophthalmic services.

The results for the year are set out on page 8.

Ordinary dividends were paid amounting to £2,000,000. The directors do not recommend payment of a final dividend.

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

Information regarding subsequent events is given in the notes to the financial statements.

The company has chosen in accordance with Companies Act 2006, s. 414C(11) to set out in the company's strategic report information required by Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, Sch. 7 to be contained in the directors' report. It has done so in respect of financial instruments and associated risks.

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.

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.

We have audited the financial statements of Black & Lizars Limited (the 'company') for the year ended 30 September 2019 which comprise the profit and loss account, 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 30 September 2019 and of its loss 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 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.

Emphasis of matter - risks and uncertainties relating to Covid-19 pandemic

We draw attention to note 1.2 of the financial statements, which details the risks and uncertainties arising from the Covid-19 pandemic. Our opinion is not modified with respect to this matter.

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 other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information. 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 year 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: https://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 member 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 member 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 member for our audit work, for this report, or for the opinions we have formed.

Black & Lizars Limited is a private company limited by shares incorporated in Scotland. The registered office is 17 Robert Drive, Glasgow, United Kingdom, G51 3HE.

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 £.

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

The company has taken advantage of the exemption under section 402 of the Companies Act 2006 not to prepare consolidated accounts, on the basis that all of its subsidiary undertakings can be excluded from consolidation under section 405. All of the company's subsidiaries are dormant and therefore their inclusion is not material for the purpose of presenting a true and fair view.

The directors are required to prepare the statutory financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business. In satisfaction of their responsibility, the directors have considered the company’s ability to meet its liabilities as they fall due. This assessment considers the company’s principal risks and uncertainties, including those in respect of Covid-19, and is dependent on a number of factors including financial performance and current resources. true

The year to September 2019 was one of upheaval for the company. Whilst the sale of 9 practices allowed the company to concentrate on its core locations and to repay all external bank debt, the lag between the loss of revenue from the practices sold and reducing the company’s overheads resulted in the company posting significant losses for the year.

The current economic environment as a result of the Covid-19 pandemic continues to be challenging. During 2020, government enforced lockdowns saw the business interrupted through enforced closure then emergency appointments only before returning to some form of normality towards the end of the year. During this time, the company took advantage of government financial support measures where available, reduced its operating cost base and managed its working capital and cash flow closely to ensure it maintained sufficient financial resources throughout. These measures have left the company with a solid base to move forward from.

With the government financial support measures in place, the business has been cash generative post year end and since the start of the pandemic. The sale of one of the company’s investment properties in May 20 has further bolstered the company’s cash reserves and at the time of writing, the company’s cash position is particularly healthy.

Despite the progress made to achieve a strong healthy cash position with limited debt, the directors acknowledge that company’s results could change depending on how the situation evolves and will assess and respond to any change in risk as appropriate. The duration of the pandemic and government lockdowns, the availability of government financial support measures and the continued impact on general economic activity could all impact the future results of the company.

The current liquidity and future cash position of the company has been reviewed by the directors. Following this review, the directors are confident that the company’s existing resources will provide sufficient headroom to meet the forecast cash requirements.

Taking all of the above into consideration, the directors have a reasonable expectation that the company will continue in operational existence for the foreseeable future. As such, they believe that it is appropriate to prepare the financial statements on the going concern basis.

Turnover is recognised at the fair value of the consideration received or receivable for sale of goods and services to customers provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Goodwill represents the excess of the fair value of consideration given to acquire various businesses over the fair value of net assets acquired. It is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses. Goodwill is considered to have a finite useful life and is amortised on a systematic basis over its expected life, which is 10 years.

For the purposes of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the acquisition. Cash-generating units to which goodwill has been allocated are tested for impairment at least annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.

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.

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. Changes in fair value are recognised in profit or loss.

Where fair value cannot be achieved without undue cost or effort, investment property is accounted for as tangible fixed assets.

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.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell. Cost is based on the first-in-first out principle and includes expenditure incurred in acquiring the stocks, production or conversion costs and other costs in bringing them to their existing location and condition.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

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, 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.

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in profit or loss, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

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.

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, bank loans, loans from fellow group companies and preference shares that are classified as debt, 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.

Derivatives, including interest rate swaps and forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Changes in the fair value of derivatives are recognised in profit or loss in finance costs or finance income as appropriate, unless hedge accounting is applied and the hedge is a cash flow hedge.

Debt instruments that do not meet the conditions in FRS 102 paragraph 11.9 are subsequently measured at fair value through profit or loss. Debt instruments may be designated as being measured at fair value through profit or loss to eliminate or reduce an accounting mismatch or if the instruments are measured and their performance evaluated on a fair value basis in accordance with a documented risk management or investment strategy.

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.

Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recognised in profit or loss immediately, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.

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 year. 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.

The carrying amount of deferred tax assets is reviewed at each reporting end date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the profit and loss account, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset when the company has a legally enforceable right to offset current tax assets and liabilities and the deferred tax assets and liabilities relate to taxes levied by the same tax authority.

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. Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value. When a provision is measured at present value, the unwinding of the discount is recognised as a finance cost in profit or loss in the period in which it arises.

The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets.

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

Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leases asset are consumed.

Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.

Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.

A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.

Exceptional items

Exceptional items are such items that are separately identifiable by virtue of their size or incidence to allow a full understanding of the underlying performance of the company.

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 future periods where the revision affects both current and future periods.

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows.

The valuation of the property is inherently subjective due to, among other factors, the individual nature of each property, its location and expected future rental revenues from that particular property. As a result, the valuations place on the company's freehold and investment property are subject to a degree of uncertainty and are made on the basis of assumptions which may not prove to be accurate, particularly in periods of volatility or low transaction flow in the property market.

The fair value of property is appraised each year either by independent external valuers or on the basis of internal valuations by the directors. The best evidence of fair value are current prices in an active market for similar investment property. In the absence of such information, the directors determine the amount within a range of reasonable fair value estimate taking into account such assumptions as the tenure and tenancy details, ground conditions, the structural condition, prevailing market yields and comparable market transactions.

The company incurred £15,589 of redundancy costs during the year following the restructure of its operations (2018 - £84,633).

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

Their aggregate remuneration comprised:

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 0 (2018 - 1).

Investment income includes the following:

Of the charge to current tax in relation to discontinued operations, £0 relates to tax on profits and £0 arose on disposal.

The actual (credit)/charge for the year can be reconciled to the expected credit for the year based on the profit or loss and the standard rate of tax as follows:

During the year the company sold nine of its practices for proceeds amounting to £3,500,000. The gain arising from the sale of the practices after deduction of legal fees was £1,417,563.

Impairment tests have been carried out where appropriate and the following impairment losses have been recognised in profit or loss:

Disposals in the year relate to the sale of practices.

Land and buildings were revalued at the year end by the directors on the basis of market value.

The last external valuation carried out was in 2017 by DM Hall, independent valuers not connected with the company.

Following the devaluation in the year, there is no revaluation surplus remaining.

Disposals in the year relate to the sale of practices.

Transfers in the year relate to certain practices that were sold but their respective properties retained and leased to the new owners. As such, the associated costs and depreciation have been transferred to Investment properties.

Investment properties were valued at the year end by the directors on the basis of market value.

The last external valuation carried out was in 2017 by DM Hall, independent valuers not connected with the company.

Details of the company's subsidiaries at 30 September 2019 are as follows:

Eyes (Scotland) Limited is a 100% subsidiary of C. Jeffrey Black (Opticians) Limited.

Subsequent to the year end, the company set up two new subsidiaries, Age Rebellion Limited and Bevital at Black & Lizars Limited, of which it owns 100% of the ordinary share capital.

Kilgour Optometrists Limited and C. Jeffrey Black (Opticians) Limited were both struck off the register post year end.

Following the sale of practices, the company's bank loan was fully repaid in the year.

The bank facilities are secured by standard security over the company's properties and bond and floating charge over the company's assets.

In the prior year, the company recognised an onerous lease provision in respect of the closure of its Belfast store. All amounts were settled during the current year.

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

At the year end the company has an unrecognised deferred tax asset amounting to £0.15m arising principally in respect of tax losses. No asset has been recognised due to uncertainty over when sufficient profits will arise to offset the losses.

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.

Each ordinary A share is entitled to one vote. There are no voting rights in relation to the ordinary B shares. There are no restrictions on the distribution of dividends for each class of ordinary shares and these carry equal rights on return of assets on liquidation.

The preference shares were redeemed in full during the year.

Included within profit and loss reserves are non-distributable profits amounting to £nil (2018 - £91,750) in respect of the fair value gains on Investment property.

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 economic landscape the company is operating in continues to be challenging. Measures taken by the government to contain the virus have affected economic activity and the company's business in various ways. The duration of the pandemic and government lockdowns, the availability of government financial support measures and the continued impact on general economic activity could all effect the future results of the company. For example, there is a risk that underlying property valuations may have decreased since the year end. Further disclosures with regards to the Covid-19 pandemic can be found in note 1.2 to the financial statements.

Subsequent to the year end the business sold one of its investment properties for proceeds amounting to £300,000 excluding transaction costs.

Total remuneration of key management personnel (including directors) amounted to £62,400 (2018 - £114,350).

Dividends totalling £2,000,000 (2018 - £200,000) were paid in the year in respect of shares held by the company's directors.

Director loans are interest free and due on demand.

The company is under the control of Mr J Hare by virtue of his shareholding.