Company No: 10041904 (England and Wales)

Contents

• Company Information
• Accountant's Report
• Balance Sheet
• Notes to the Unaudited Financial Statements

DIRECTOR	M R A Merchant
REGISTERED OFFICE	14 Bedford Square
	London
	WC1B 3JA
	United Kingdom
COMPANY NUMBER	10041904(England and Wales)
ACCOUNTANT	Deloitte LLP
	1 New Street Square
	London
	EC4A 3HQ
	United Kingdom

In order to assist you to fulfil your duties under the Companies Act 2006, we have prepared for your approval the financial statements of The Collective Acton 2 Limited for the financial year ended 31 March 2020 which comprises the Balance Sheet and the related notes 1 to 8 from the Company’s accounting records and from information and explanations you have given us.

We are subject to the ethical and other professional requirements of the Institute of Chartered Accountants in England and Wales (ICAEW) which are detailed at _http://www.icaew.com/en/members/regulations-standards-and-guidance/_.

It is your duty to ensure that The Collective Acton 2 Limited has kept adequate accounting records and to prepare statutory financial statements that give a true and fair view of the assets, liabilities, financial position and loss of The Collective Acton 2 Limited. You consider that The Collective Acton 2 Limited is exempt from the statutory audit requirement for the financial year.

We have not been instructed to carry out an audit or a review of the financial statements of The Collective Acton 2 Limited. For this reason, we have not verified the accuracy or completeness of the accounting records or information and explanations you have given to us and we do not, therefore, express any opinion on the statutory financial statements.

This report is made solely to the Director of The Collective Acton 2 Limited, as a body, in accordance with the terms of our engagement letter dated 25 April 2019. Our work has been undertaken solely to prepare for your approval the financial statements of The Collective Acton 2 Limited and state those matters that we have agreed to state to you in this report in accordance with ICAEW Technical Release 07/16 AAF. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than The Collective Acton 2 Limited and its Director as a body for our work or for this report.

Deloitte LLP
Accountant

1 New Street Square
London
EC4A 3HQ
United Kingdom

12 May 2021

		2020		2019
	Note	£		£
Fixed assets
Tangible assets	3	4,323,535		1,816,600
		4,323,535		1,816,600
Current assets
Debtors	4	15,080		56,214
Cash at bank and in hand		43,889		13,003
		58,969		69,217
Creditors
Amounts falling due within one year	5	( 4,402,798)		( 1,892,898)
Net current liabilities		(4,343,829)		(1,823,681)
Total assets less current liabilities		(20,294)		(7,081)
Net liabilities		( 20,294)		( 7,081)
Capital and reserves
Called-up share capital		100		100
Profit and loss account		( 20,394 )		( 7,181 )
Total shareholder's deficit		( 20,294)		( 7,081)

For the financial year ending 31 March 2020 the Company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.

Director's responsibilities:

• The member has not required the Company to obtain an audit of its financial statements for the financial year in accordance with section 476;
• The director acknowledges their responsibilities for complying with the requirements of the Act with respect to accounting records and the preparation of financial statements; and
• These financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime and a copy of the Profit and Loss Account has not been delivered.

The financial statements of The Collective Acton 2 Limited (registered number: 10041904) were approved and authorised for issue by the Director on 12 May 2021. They were signed on its behalf by:

M R A Merchant Director

1. Accounting policies

The principal accounting policies are summarised below. They have all been applied consistently throughout the financial year and to the preceding financial year.

General information and basis of accounting

The Collective Acton 2 Limited (the Company) is a private company, limited by shares, incorporated in the United Kingdom under the Companies Act 2006 and is registered in England and Wales. The address of the Company's registered office is 14 Bedford Square, London, WC1B 3JA, United Kingdom.

The financial statements have been prepared under the historical cost convention and in accordance with Section 1A of Financial Reporting Standard 102 (FRS 102) ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland’ issued by the Financial Reporting Council.

The functional currency of The Collective Acton 2 Limited is considered to be pounds sterling because that is the currency of the primary economic environment in which the Company operates.

Going concern

The director believes that notwithstanding current year losses, net current liabilities and net liabilities, and having considered the impact of the COVID-19 pandemic, the Company's financial statements should be prepared on a going concern basis. The director considers the current and future sources of funding or support from investors to be adequate to meet the Company's needs for a period of at least 12 months from the date of approval of these financial statements. Expenditure for The Collective Acton 2 Limited consists of property development expenditure which is at the Company's discretion. As such, the director believes that it is well placed to manage the financing and other business risks satisfactorily and have adequate resources to continue in operation for at least 12 months from the signing of these accounts.

The Company re-financed the £3.8m loan (including interest) in January 2021 with a maturity date of February 2022. The director believes that loan will be re-financed again in 2022, however if additional financing was not secured, the loan could be repaid via sale of the property, construction of which was finalised in October 2020. The director has confirmed that no intra-group amounts owed by the Company will be called for repayment for a period of at least 12 months from the date of approval of these financial statements unless the Company is in a position to make payments. Accordingly, they continue to adopt the going concern basis in preparing the financial statements.

Taxation

Current tax
Current tax is provided at amounts expected to be paid (or recoverable) using the tax rates and laws that have been enacted or substantively enacted at the Balance Sheet date.

Deferred tax
Deferred tax arises as a result of including items of income and expenditure in taxation computations in periods different from those in which they are included in the Company's financial statements. Deferred tax is provided in full on timing differences which result in an obligation to pay more or less tax at a future date, at the average tax rates that are expected to apply when the timing differences reverse, based on current tax rates and laws.

Deferred tax assets and liabilities are not discounted.

Tangible fixed assets

Tangible fixed assets are stated at cost, net of depreciation and any provision for impairment. Depreciation is provided on all tangible fixed assets, other than investment properties and freehold land, at rates calculated to write off the cost, less estimated residual value, of each asset on a basis over its expected useful life as follows:

Assets under the course of construction are not depreciated until the asset is brought into use.

Residual value represents the estimated amount which would currently be obtained from disposal of an asset, after deducting estimated costs of disposal, if the asset were already of the age and in the condition expected at the end of its useful life.

Impairment of assets

Assets, other than those measured at fair value, are assessed for indicators of impairment at each Balance Sheet date. If there is objective evidence of impairment, an impairment loss is recognised in the Profit and Loss Account as described below.

Non-financial assets
An asset is impaired where there is objective evidence that, as a result of one or more events that occurred after initial recognition, the estimated recoverable value of the asset has been reduced. The recoverable amount of an asset is the higher of its fair value less costs to sell and its value in use.

Where indicators exist for a decrease in impairment loss, the prior impairment loss is tested to determine reversal. An impairment loss is reversed on an individual impaired asset to the extent that the revised recoverable value does not lead to a revised carrying amount higher than the carrying value had no impairment been recognised.

Financial assets
For financial assets carried at amortised cost, the amount of impairment is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the financial asset’s original effective interest rate.

For financial assets carried at cost less impairment, the impairment loss is the difference between the asset’s carrying amount and the best estimate of the amount that would be received for the asset if it were to be sold at the reporting date.

Where indicators exist for a decrease in impairment loss, and the decrease can be related objectively to an event occurring after the impairment was recognised, the prior impairment loss is tested to determine reversal. An impairment loss is reversed on an individual impaired financial asset to the extent that the revised recoverable value does not lead to a revised carrying amount higher than the carrying value had no impairment been recognised.

Financial instruments

Financial assets and financial liabilities are recognised when the Company becomes a party to the contractual provisions of the instrument.

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.

Financial assets and liabilities
All financial assets and liabilities are initially measured at transaction price (including transaction costs), except for those financial assets classified as at fair value through the Profit and Loss Account, which are initially measured at fair value (which is normally the transaction price excluding transaction costs), unless the arrangement constitutes a financing transaction. If an arrangement constitutes a financing transaction, the financial asset or financial liability is measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument.

Financial assets and liabilities are only offset in the Balance Sheet when, and only when there exists a legally enforceable right to set off the recognised amounts and the Company intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.

Financial assets are derecognised when and only when a) the contractual rights to the cash flows from the financial asset expire or are settled, b) the Company transfers to another party substantially all of the risks and rewards of ownership of the financial asset, or c) the Company, despite having retained some, but not all, significant risks and rewards of ownership, has transferred control of the asset to another party.

Financial liabilities are derecognised only when the obligation specified in the contract is discharged, cancelled or expires.

2. Employees

	2020	2019
	Number	Number
Monthly average number of persons employed by the Company during the year, including director	1	1

3. Tangible assets

	Assets under construction	Total
	£	£
Cost/Valuation
At 01 April 2019	1,816,600	1,816,600
Additions	2,506,935	2,506,935
At 31 March 2020	4,323,535	4,323,535
Accumulated depreciation
At 01 April 2019	0	0
At 31 March 2020	0	0
Net book value
At 31 March 2020	4,323,535	4,323,535
At 31 March 2019	1,816,600	1,816,600

Assets under the course of construction represent costs incurred during the year in the development of investment property, which remains under construction at the year end.

Included within asset under construction is capitalised finance cost of £319,480 (2019: £75,202).

4. Debtors

	2020	2019
	£	£
Amounts owed by Group undertakings	100	100
Other taxation and social security	14,980	56,114
	15,080	56,214

Amounts owed by Group undertakings are interest free and repayable on demand. Included in other debtors is unpaid share capital £100 (2019: £100).

5. Creditors: amounts falling due within one year

	2020	2019
	£	£
Trade creditors	36,584	259,926
Amounts owed to Group undertakings	324,890	274,240
Other creditors	4,041,324	1,358,732
	4,402,798	1,892,898

Amounts owed to Group undertakings are interest free and repayable on demand.

Included within other creditor is other loans of £3,854,310 (2019: £1,357,532). In January 2021 the Company re-financed the loan with a different lender and is due for repayment 13 months from the utilisation date.

The Company has a fixed and floating charge over all the property or undertakings of the Company.

6. Related party transactions

The Company has taken advantage of the exemption available under FRS 102.33.1A not to disclose transactions with other wholly owned Group entities. Included within creditors is an unsecured intercompany loan of £187,014 (2019: £1,200) owed to The Collective (Living) Limited. The amount is interest free and repayable on demand.

There was no remuneration paid to the director. The director is the only key management personnel of this Company.

7. Events after the Balance Sheet date

On 11th May 2020, there was a reorganisation within the group structure which changed the ultimate parent company as The Collective (Living) Group Limited. Prior to this reorganisation, the ultimate controlling party was M R A Merchant.

Post year end on October 2020 the construction of the asset has completed.

Due to Covid-19 the Collective Group and hence the Company, is currently being impacted through delays at its development sites and reduced occupancy at its operational sites. Management continue to monitor the impact of the virus on the business as more information about the epidemic emerges.

8. Ultimate controlling party

The Company is a subsidiary of The Collective (Living) Group Limited, which is the parent company of the smallest group for which consolidated financial statements are drawn up. The Collective (Living) Group Limited is incorporated and registered at 14 Bedford Square, London, England, WC1B 3JA.