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Registered number: 10562227
Discovery Park Management Limited
Annual report and financial statements
For the year ended 30 November 2021
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Discovery Park Management Limited
Company Information
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Chartered Accountants & Statutory Auditor
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Discovery Park Management Limited
Contents
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Directors' responsibilities statement
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Independent auditor's report
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Statement of income and retained earnings
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Notes to the financial statements
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Discovery Park Management Limited
Strategic report
For the year ended 30 November 2021
The directors present their strategic report for the year ended 30 November 2021.
Discovery Park continues to grow as a world class science park based in Sandwich, Kent. The park offers high quality laboratory, office and manufacturing facilities, the space and support to expand, access to local finance, and a strong local scientific talent pool.
The park is owned by Discovery Park Limited (DPL), who have appointed Discovery Park Management Limited (DPML) as the managing agent for Discovery Park with the responsibility for;
∙the delivery of facilities management and utility services
∙the provision of catering and events services
∙driving and delivering growth across Discovery Park.
Most of the operational services are delivered in house through a dedicated workforce employed by DPML. This allows DPML to deliver effective, reliable and resilient services across the site whilst achieving optimal efficiency.
To enable effective delivery of our services and achieve operational excellence DPML operates a business model that ensures effective governance, enables strong risk management, contingency planning, performance monitoring and root cause analysis and learnings.
In addition, processes and procedures regularly continue to be developed and reviewed to enable strong and effective deliver.
This model also ensures that DPML works as one team with a clear vision, whereby a golden thread clearly articulates all staff’s objectives to deliver the businesses overarching vison and goals.
Through effective dialogue and open and transparent reporting Discovery Park Management can work collaboratively to enable key priorities to be discussed and action plans agreed, with timings for implementation, that have minimal impact, if any, on our science tenants.
Principal risks and uncertainties
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The company faces a number of risks which it manages appropriately at an operational, tactical and strategic level. Below are the key risks as considered by the Board in no particular order.
1. DPL failure
The risk of failure of DPL for whom the activities are delivered is well managed and mitigated.
DPL is a well-established company with a strong tenant base. Over the last 18 months, DPL has delivered a number of new development projects which will further drive growth and expansion.
The Board works closely with all senior management of DPL to ensure services delivered by DPML are satisfactory and to the need of DPL and its tenants. Via regular review of DPLs positioning and liquidity the Board closely monitors this risk.
2. Liquidity
Liquidity risk is the risk that the company will encounter difficulty in meeting its financial obligations as they fall due. The company’s objective in managing liquidity risk is to ensure that this does not arise. The nature of specific projects undertaken by the company is that a significant cash outflow is required at the outset prior to any inflow from the yielding results. Having assessed future cash flow requirements, the company expects to be able to meet its financial obligations through the cash flows that are generated from its operating activities and its current available facilities from its investor base.
Page 1
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Discovery Park Management Limited
Strategic report (continued)
For the year ended 30 November 2021
3. Energy costs
The global volatility within the energy sector is impacting the cost of utility supplies to DPL and its tenant base. Significant increases in the cost base may impact DPLs liquidity and the Company is working closely with DPL and its tenant base to ensure that energy procurement and consumption is actively monitored and managed.
Financial key performance indicators
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The company uses a range of measures to ensure that the business is properly controlled. These include:
1. Turnover
2. Management fee income
3. Profitability
This report was approved by the board and signed on its behalf.
Page 2
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Discovery Park Management Limited
Directors' report
For the year ended 30 November 2021
The directors present their report and the financial statements for the year ended 30 November 2021.
The principal activity of the company continued to be that of managing the facilities within a world-class world leading science park. This includes managing the water, electricity, gas, catering and maintenance around the site.
The profit for the year, after taxation, amounted to £54,019 (2020 - £36,604).
No ordinary dividends were paid (2020 - £NIL). The directors do not recommend payment of a final dividend.
The directors who served during the year were:
The company's strategic focus continues to be that of managing the facilities within a world-class world leading science park. This includes managing the water, electricity, gas, catering and maintenance around the site.
Financial risk management
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The main risks arising from financial instruments are liquidity risk and customer credit exposure. See note 16 for further information regarding the company's approach to these risks.
Disclosure of information to auditor
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Each of the persons who are directors at the time when this directors' report is approved has confirmed that:
∙so far as the director is aware, there is no relevant audit information of which the company's auditor is unaware, and
∙the director has taken all the steps that ought to have been taken as a director in order to be aware of any relevant audit information and to establish that the company's auditor is aware of that information.
Post balance sheet events
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There have been no significant events affecting the company since the year end.
Page 3
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Discovery Park Management Limited
Directors' report (continued)
For the year ended 30 November 2021
The auditor, Kreston Reeves LLP, will be proposed for reappointment in accordance with section 485 of the Companies Act 2006.
This report was approved by the board and signed on its behalf.
Page 4
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Discovery Park Management Limited
Directors' responsibilities statement
For the year ended 30 November 2021
The directors are responsible for preparing the strategic report, the directors' 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 applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland'. 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 for the company's financial statements 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 to 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.
The directors are responsible for the maintenance and integrity of the corporate and financial information included on the company's website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements and other information included in directors' reports may differ from legislation in other jurisdictions.
Page 5
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Discovery Park Management Limited
Independent auditor's report to the members of Discovery Park Management Limited
We have audited the financial statements of Discovery Park Management Limited (the 'company') for the year ended 30 November 2021, which comprise the statement of income and retained earnings, the balance sheet, the statement of cash flows and the related notes, 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 Financial Reporting Standard 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 November 2021 and of its profit 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.
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 United Kingdom, including the Financial Reporting Council'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.
Conclusions relating to going concern
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In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.
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 contained within the Annual Report. 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. 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 course of 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 this gives rise to a material misstatement in the financial statements themselves. 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.
Page 6
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Discovery Park Management Limited
Independent auditor's report to the members of Discovery Park Management Limited (continued)
Opinion on other matters prescribed by the Companies Act 2006
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In our opinion, based on the work undertaken in the course of the 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.
Matters on which we are required to report by exception
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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 or the directors' report.
We have nothing to report in respect of the following matters in relation to which 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.
Responsibilities of directors
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As explained more fully in the directors' responsibilities statement set out on page 5, 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.
Page 7
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Discovery Park Management Limited
Independent auditor's report to the members of Discovery Park Management Limited (continued)
Auditor's responsibilities for the audit of the financial statements
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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.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
Capability of the audit in detecting irregularities, including fraud
Based on our understanding of the group and industry, and through discussion with the directors and other management (as required by auditing standards), we identified that the principal risks of non-compliance with laws and regulations related to health and safety, anti-bribery and employment law. We considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the preparation of the financial statements such as the Companies Act 2006. We communicated identified laws and regulations throughout our team and remained alert to any indications of non-compliance throughout the audit. We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls) and determined that the principal risks were related to posting inappropriate journal entries to increase revenue or reduce expenditure, management bias in accounting estimates and judgemental areas of the financial statements such as the valuation of investment properties. Audit procedures performed by the group engagement team included:
• Discussions with management and assessment of known or suspected instances of non-compliance with laws and regulations (including health and safety) and fraud, and review of the reports made by management and internal audit; and
• Assessment of identified fraud risk factors; and
• Confirmation of related parties with management, and review of transactions throughout the period to identify any previously undisclosed transactions with related parties outside the normal course of business; and
• Review of significant and unusual transactions and evaluation of the underlying financial rationale supporting the transactions; and
• Identifying and testing journal entries, in particular any manual entries made at the year end for financial statement preparation
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance.
Page 8
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Discovery Park Management Limited
Independent auditor's report to the members of Discovery Park Management Limited (continued)
As part of an audit in accordance with ISAs (UK), we exercise professional judgement and maintain professional scepticism throughout the audit. We also:
∙Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
∙Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion of the effectiveness of the company's internal control.
∙Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.
∙Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the company to cease to continue as a going concern.
∙Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
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.
Mark Attwood FCCA (senior statutory auditor)
for and on behalf of
Kreston Reeves LLP
Chartered Accountants
Statutory Auditor
Canterbury
31 August 2022
Page 9
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Discovery Park Management Limited
Statement of income and retained earnings
For the year ended 30 November 2021
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Interest payable and similar expenses
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Retained earnings at the beginning of the year
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Retained earnings at the end of the year
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There were no recognised gains and losses for 2021 or 2020 other than those included in the statement of income and retained earnings.
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The notes on pages 13 to 25 form part of these financial statements.
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Page 10
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Discovery Park Management Limited
Registered number: 10562227
Balance sheet
As at 30 November 2021
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Debtors: amounts falling due within one year
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Creditors: amounts falling due within one year
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Total assets less current liabilities
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Provisions for liabilities
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The financial statements were approved and authorised for issue by the board and were signed on its behalf by:
The notes on pages 13 to 25 form part of these financial statements.
Page 11
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Discovery Park Management Limited
Statement of cash flows
For the year ended 30 November 2021
Cash flows from operating activities
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Profit for the financial year
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Amortisation of intangible assets
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Depreciation of tangible assets
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Corporation tax (paid)/received
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Net cash generated from operating activities
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Cash flows from investing activities
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Purchase of tangible fixed assets
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Government grants received
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Net cash from investing activities
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Cash flows from financing activities
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Net cash used in financing activities
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Net increase in cash and cash equivalents
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Cash and cash equivalents at beginning of year
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Cash and cash equivalents at the end of year
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Cash and cash equivalents at the end of year comprise:
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The notes on pages 13 to 25 form part of these financial statements.
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Page 12
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Discovery Park Management Limited
Notes to the financial statements
For the year ended 30 November 2021
Discovery Park Limited is a private company limited by shares incorporated in England with registration number 08089816. The registered office is 147 Stamford Hill, London, N16 5LG and its principal place of business is Discovery Park, Innovation House, Ramsgate Road, Sandwich, Kent, CT13 9FF. The financial statements for the year ended 31 December 2018 were unaudited.
The principal activity of the company continued to be that of managing the facilities within a world-class world leading science park. This includes managing the water, electricity, gas, catering and maintenance around the site. Further information on the activities of the company is included as part of the strategic report on pages 1 to 2.
2.Accounting policies
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Basis of preparation of financial statements
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The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006.
The financial statements are presented in pounds sterling and are rounded to the nearest pound.
The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the company's accounting policies (see note 3).
The following principal accounting policies have been applied:
While the ongoing impact of the COVID-19 pandemic has been assessed by the directors so far as reasonably possible, due to its unprecedented impact on the wider economy, it is difficult to evaluate the potential outcomes on the company's operations with certainty. However, taking into consideration the latest UK Government restrictions and support, and the company's planning, the directors have formed a reasonable expectation that the company will continue in operational existence for the foreseeable future. Therefore, these financial statements continue to be prepared on a going concern basis.
Page 13
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Discovery Park Management Limited
Notes to the financial statements
For the year ended 30 November 2021
2.Accounting policies (continued)
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the company and the revenue can be reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes. The following criteria must also be met before revenue is recognised:
Sale of goods
Revenue from the sale of goods is recognised when all of the following conditions are satisfied:
∙the company has transferred the significant risks and rewards of ownership to the buyer;
∙the company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
∙the amount of revenue can be measured reliably;
∙it is probable that the company will receive the consideration due under the transaction; and
∙the costs incurred or to be incurred in respect of the transaction can be measured reliably.
Rendering of services
Revenue from a contract to provide services is recognised in the period in which the services are provided in accordance with the stage of completion of the contract when all of the following conditions are satisfied:
∙the amount of revenue can be measured reliably;
∙it is probable that the company will receive the consideration due under the contract;
∙the stage of completion of the contract at the end of the reporting period can be measured reliably; and
∙the costs incurred and the costs to complete the contract can be measured reliably.
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Operating leases: the company as lessee
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Rentals paid under operating leases are charged to profit or loss on a straight-line basis over the lease term.
Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight-line basis over the lease term, unless another systematic basis is representative of the time pattern of the lessee's benefit from the use of the leased asset.
Grants are accounted under the accruals model as permitted by FRS 102. Grants relating to expenditure on tangible fixed assets are credited to profit or loss at the same rate as the depreciation on the assets to which the grant relates. The deferred element of grants is included in creditors as deferred income.
Grants of a revenue nature are recognised in the statement of income and retained earnings in the same period as the related expenditure.
Finance costs are charged to profit or loss over the term of the debt using the effective interest method so that the amount charged is at a constant rate on the carrying amount. Issue costs are initially recognised as a reduction in the proceeds of the associated capital instrument.
Page 14
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Discovery Park Management Limited
Notes to the financial statements
For the year ended 30 November 2021
2.Accounting policies (continued)
Defined contribution pension plan
The company operates a defined contribution plan for its employees. A defined contribution plan is a pension plan under which the company pays fixed contributions into a separate entity. Once the contributions have been paid the company has no further payment obligations.
The contributions are recognised as an expense in profit or loss when they fall due. Amounts not paid are shown in accruals as a liability in the balance sheet. The assets of the plan are held separately from the company in independently administered funds.
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Current and deferred taxation
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The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss except that a charge attributable to an item of income and expense recognised as other comprehensive income or to an item recognised directly in equity is also recognised in other comprehensive income or directly in equity respectively.
The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the balance sheet date in the countries where the company operates and generates income.
Deferred tax balances are recognised in respect of all timing differences that have originated but not reversed by the balance sheet date, except that:
∙The recognition of deferred tax assets is limited to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits; and
∙Any deferred tax balances are reversed if and when all conditions for retaining associated tax allowances have been met.
Deferred tax balances are not recognised in respect of permanent differences except in respect of business combinations, when deferred tax is recognised on the differences between the fair values of assets acquired and the future tax deductions available for them and the differences between the fair values of liabilities acquired and the amount that will be assessed for tax. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date.
Intangible assets are initially recognised at cost. After recognition, under the cost model, intangible assets are measured at cost less any accumulated amortisation and any accumulated impairment losses.
At each reporting date the company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.
All intangible assets are considered to have a finite useful life. If a reliable estimate of the useful life cannot be made, the useful life shall not exceed ten years.
Amortisation is provided on the following bases:
Page 15
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Discovery Park Management Limited
Notes to the financial statements
For the year ended 30 November 2021
2.Accounting policies (continued)
Tangible fixed assets under the cost model are stated at historical cost less accumulated depreciation and any accumulated impairment losses. Historical cost includes expenditure that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.
At each reporting date the company assesses whether there is any indication of impairment. If such indication exists, the recoverable amount of the asset is determined which is the higher of its fair value less costs to sell and its value in use. An impairment loss is recognised where the carrying amount exceeds the recoverable amount.
The company adds to the carrying amount of an item of fixed assets the cost of replacing part of such an item when that cost is incurred, if the replacement part is expected to provide incremental future benefits to the company. The carrying amount of the replaced part is derecognised. Repairs and maintenance are charged to profit or loss during the period in which they are incurred.
Depreciation is charged so as to allocate the cost of assets less their residual value over their estimated useful lives, on a reducing balance basis.
Depreciation is provided on the following basis:
The assets' residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively if appropriate, or if there is an indication of a significant change since the last reporting date.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in profit or loss.
Stocks are stated at the lower of cost and net realisable value, being the estimated selling price less costs to complete and sell. Cost is based on the cost of purchase on a first in, first out basis.
At each balance sheet date, stocks are assessed for impairment. If stock is impaired, the carrying amount is reduced to its selling price less costs to complete and sell. The impairment loss is recognised immediately in profit or loss.
Short-term debtors are measured at transaction price, less any impairment. Loans receivable are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method, less any impairment.
Page 16
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Discovery Park Management Limited
Notes to the financial statements
For the year ended 30 November 2021
2.Accounting policies (continued)
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Cash and cash equivalents
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Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value.
In the statement of cash flows, cash and cash equivalents are shown net of bank overdrafts that are repayable on demand and form an integral part of the company's cash management.
Short-term creditors are measured at the transaction price. Other financial liabilities, including bank loans, are measured initially at fair value, net of transaction costs, and are measured subsequently at amortised cost using the effective interest method.
The company only enters into basic financial instrument transactions that result in the recognition of financial assets and liabilities like trade and other debtors and creditors, loans from banks and other third parties, loans to related parties and investments in ordinary shares.
Debt instruments (other than those wholly repayable or receivable within one year), including loans and other accounts receivable and payable, are initially measured at present value of the future cash flows and subsequently at amortised cost using the effective interest method. Debt instruments that are payable or receivable within one year, typically trade debtors and creditors, are measured, initially and subsequently, at the undiscounted amount of the cash or other consideration expected to be paid or received. However, if the arrangements of a short-term instrument constitute a financing transaction, like the payment of a trade debt deferred beyond normal business terms or in case of an out-right short-term loan that is not at market rate, the financial asset or liability is measured, initially at the present value of future cash flows discounted at a market rate of interest for a similar debt instrument and subsequently at amortised cost, unless it qualifies as a loan from a director in the case of a small company, or a public benefit entity concessionary loan.
Financial assets that are measured at cost and amortised cost are assessed at the end of each reporting period for objective evidence of impairment. If objective evidence of impairment is found, an impairment loss is recognised in the statement of income and retained earnings.
For financial assets measured at amortised cost, the impairment loss is measured as the difference between an asset's carrying amount and the present value of estimated cash flows discounted at the asset's original effective interest rate. If a financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract.
For financial assets measured at cost less impairment, the impairment loss is measured as the difference between an asset's carrying amount and best estimate of the recoverable amount, which is an approximation of the amount that the company would receive for the asset if it were to be sold at the balance sheet date.
Financial assets and liabilities are offset and the net amount reported in the balance sheet when there is an 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.
Page 17
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Discovery Park Management Limited
Notes to the financial statements
For the year ended 30 November 2021
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Judgements in applying accounting policies and key sources of estimation uncertainty
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The preparation of the financial statements requires the directors to make judgements, estimates and assumptions that can affect the amounts reported for assets and liabilities, and the results for the year. The nature of estimation is such though that actual outcomes could differ significantly from those estimates.
The following judgements have had the most significant impact on amounts recognised in the financial statements:
Impairment of debtors
The company makes an estimate of the recoverable value of trade and other debtors. When assessing impairment of trade and other debtors, management considers factors including the current credit rating of the debtor, the ageing profile of debtors and historical experience. See note 13 for the net carrying amount of debtors and associated impairment provision.
Service charges
The company is responsible for the employment of staff members who are utilised by the tenants through a service charge arrangement. In previous years management have therefore presented the financial statements without showing the gross position of expenses and income passing through the entity in relation to the service charge. This is in accordance with FRS 102 requirements on the presentation of transactions where the entity is acting as agent rather than principal. Management were also of the opinion that this provided the user of the accounts with the most accurate representation of the financial position of the company in previous years.
In the year ended 30 November 2021, the company is no longer acting as agent for the management of service charges. Therefore the service charge income and expenses are not netted off against one another and show the gross position of the amounts incurred in the year. This treatment will continue for the foreseeable future.
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An analysis of turnover by class of business is as follows:
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Service charge management
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Landlord projects & Overheads
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Management fees receivable
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All turnover arose within the United Kingdom.
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Page 18
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Discovery Park Management Limited
Notes to the financial statements
For the year ended 30 November 2021
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Government grants receivable
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Government grants relate to support received as part of the Government's response to the COVID-19 pandemic.
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Fees payable to the company's auditor for the audit of the company's annual financial statements
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Staff costs, including directors' remuneration, were as follows:
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Cost of defined contribution scheme
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The average monthly number of employees, including the directors, during the year was as follows:
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Page 19
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Discovery Park Management Limited
Notes to the financial statements
For the year ended 30 November 2021
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Interest payable and similar expenses
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Current tax on profits for the year
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Adjustments in respect of previous periods
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Origination and reversal of timing differences
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Taxation on profit on ordinary activities
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Factors affecting tax charge for the year
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The tax assessed for the year is the same as (2020 - the same as) the standard rate of corporation tax in the UK of 19% (2020 - 19%) as set out below:
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Profit on ordinary activities before tax
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Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 19% (2020 - 19%)
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Other differences leading to an increase (decrease) in the tax charge
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Total tax charge for the year
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Page 20
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Discovery Park Management Limited
Notes to the financial statements
For the year ended 30 November 2021
9.Taxation (continued)
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Factors that may affect future tax charges
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As part of the Finance Bill 2020, which was substantively enacted on 17 March 2020, the corporation tax
main rate is to remain at 19% until 31 March 2023.
Following the end of the accounting period, the UK government have announced that the main rate will
increase on 1 April 2023 to 25%, for companies with taxable profits above £250,000. Companies with
taxable profits below £50,000 will continue to pay at 19%, and marginal relief will apply between these
thresholds. This change forms part of the Finance Bill 2021, which was substantively enacted on 24 May
2021.
Deferred taxes have been measured using rates substantively enacted at the reporting date and reflected
in these financial statements.
The company has no unused tax losses available for offset again future taxable profits.
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Charge for the year on owned assets
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Page 21
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Discovery Park Management Limited
Notes to the financial statements
For the year ended 30 November 2021
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Charge for the year on owned assets
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Raw materials and consumables
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Work in progress (goods to be sold)
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Prepayments and accrued income
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Page 22
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Discovery Park Management Limited
Notes to the financial statements
For the year ended 30 November 2021
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Cash and cash equivalents
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Creditors: Amounts falling due within one year
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Other taxation and social security
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Accruals and deferred income
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Financial risk management
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The company has exposure to two main areas of risk, being liquidity risk and customer credit exposure. The company has established a risk and financial management framework whose primary objective is to mitigate the company’s exposure to risk in order to protect the company from events that may hinder its performance.
Liquidity risk
Liquidity risk is the risk that the group will encounter difficulty in meeting its financial obligations as they fall due. The company’s objective in managing liquidity risk is to ensure that this does not arise. The nature of specific projects undertaken by the company is that a significant cash outflow is required at the outset prior to any inflow from the yielding results. Having assessed future cash flow requirements the group expects to be able to meet its financial obligations through the cash flows that are generated from its operating activities and its current available facilities.
Customer credit exposure
The company is at risk to the extent that a customer may be unable to pay its debt within the terms offered. This risk is mitigated by the strong on-going customer relationships and by only granting services to customers who are able to demonstrate an appropriate payment history and satisfy credit worthiness procedures. Details of the company’s trade debtors are shown in note 13.
Page 23
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Discovery Park Management Limited
Notes to the financial statements
For the year ended 30 November 2021
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Charged to profit or loss
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The provision for deferred taxation is made up as follows:
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Accelerated capital allowances
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The net deferred tax liability expected to reverse in 2022 is £500. This primarily relates to timing differences on acquired tangible assets.
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Authorised, allotted, called up and fully paid
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10 (2020 - 10) Ordinary shares of £1.00 each
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Profit and loss account
This reserve comprises all current and prior period retained profits and losses after deducting any distributions made to the company's shareholders.
The company operates a defined contributions pension scheme. The assets of the scheme are held separately from those of the company in an independently administered fund. The pension cost charge represents contributions payable by the company to the fund and amounted to £86,942 (2020 - £60,605) . Contributions totalling £16,437 (2020 - £16,566) were payable to the fund at the balance sheet date and are included in creditors.
Page 24
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Discovery Park Management Limited
Notes to the financial statements
For the year ended 30 November 2021
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Commitments under operating leases
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At 30 November 2021 the company had future minimum lease payments due under non-cancellable operating leases for each of the following periods:
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Later than 1 year and not later than 5 years
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Related party transactions
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The company entered into the following related party transactions during the year:
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Purchases from entities controlled by the directors or their close family members
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Sales to entities controlled by the directors or their close family members
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Amounts due from entities controlled by the directors or their close family members
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Amounts owed to entities controlled by the directors or their close family members
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Sales and purchases above include gross service charges, which are otherwise shown net within these financial statements (see note 3).
In addition to the transactions disclosed above, working capital advances and repayments have been made during the year between the company and entities controlled by close family members of the directors. No interest has been charged on these short term balances.
Amounts due from entities controlled by the directors or their close family members are unsecured, interest free and are repayable on demand.
Amounts owed to entities controlled by the directors or their close family members are unsecured, interest free, have no fixed date of repayment and are repayable on demand.
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The company is controlled by M Schreiber by virtue of her majority shareholding.
Page 25
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