Moness Group Limited - Limited company accounts 20.1

REGISTERED NUMBER: SC198912 (Scotland)

STRATEGIC REPORT,

REPORT OF THE DIRECTORS AND

AUDITED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2021

FOR

MONESS GROUP LIMITED

Page

Company Information

1

Strategic Report

2

Report of the Directors

3

Report of the Independent Auditors

4

Income Statement

8

Other Comprehensive Income

9

Statement of Financial Position

10

Statement of Changes in Equity

11

Statement of Cash Flows

12

Notes to the Statement of Cash Flows

13

Notes to the Financial Statements

14

DIRECTORS:

S J McKenzie

J McKenzie

REGISTERED OFFICE:

Moness House Hotel & Country Club

Crieff Road

Aberfeldy

Perthshire

PH15 2DY

REGISTERED NUMBER:

SC198912 (Scotland)

AUDITORS:

Murray Taylor LLP

Statutory Auditor

10 Murray Lane

Montrose

Angus

DD10 8LF

The directors present their strategic report for the year ended 31 December 2021.

REVIEW OF BUSINESS

The company continues to specialise in hotel, holiday rentals, food and beverage outlets and a mix of other associated retail and leisure facilities.

Risk management is addressed through a framework of policies, procedures and internal controls. All policies are subject to Board approval and are reviewed on an ongoing basis by senior management. Compliance with all laws and regulations is a high priority for the company and is communicated through daily work practices.

We consider the main risk to the business to be reputational. It is important to us that our guests enjoy the full holiday experience ensuring that we maintain a high occupancy and continuing repeat business.

We consider our key performance indicators to be those which reflect the financial performance and strength of the company as a whole, these being gross margin, gross profit percentage, occupancy and operating profit.

The company's turnover has increased from £2.2m to £2.9m. Alongside the increase in turnover in the year the company has also produced a better gross profit percentage. The gross profit percentage has increased to 56.9% from 48.2%.

The gross profit trading results for the current year have improved on the prior year with a gross profit of £1,667,591 (2020: £1,079,838). Following a review of the business and operating costs in 2019 after a management buyout in April 2019 it was anticipated that a reduction in cost of sales, wages and administrative expenses together with an improved gross profit percentage would be seen in 2020. The results for the prior year showed improvements however these were impacted by the coronavirus pandemic. In the current year however the improvements are now being seen.

PRINCIPAL RISKS, UNCERTAINTIES AND FINANCIAL INSTRUMENTS

The business' principal financial instruments comprise bank balances, trade debtors, trade creditors and loans to the business. The main purpose of these instruments is to finance the business' operations.

All of the business' cash balances are held in such a way that achieves a competitive rate of interest. The business makes use of money market faculties where funds are available.

Trade debtors are managed in respect of credit and cash flow risk by policies concerning the credit offered to customers and the regular monitoring of amounts outstanding for both time and credit limits. The amounts presented in the balance sheet are net of allowances for doubtful debtors.

Trade creditors' liquidity risk is managed by ensuring sufficient funds are available to meet amounts due.

FUTURE DEVELOPMENTS

The Board expect turnover and gross profit to continue to increase with the combined focus on occupancy and with bookings of functions making more use of the marquee.

ON BEHALF OF THE BOARD:

J McKenzie - Director

28 September 2022

The directors present their report with the financial statements of the company for the year ended 31 December 2021.

PRINCIPAL ACTIVITY

The principal activity of the company in the year under review was that of holiday rentals and timeshare leisure resort operations.

DIVIDENDS

No dividends will be distributed for the year ended 31 December 2021.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 January 2021 to the date of this report.

S J McKenzie

J McKenzie

DISCLOSURE IN THE STRATEGIC REPORT

In accordance with Section 414c (ii) of the Companies Act 2006, information regarding financial instruments and future developments has been included in the Strategic Report.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Strategic Report, the Report of the Directors 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.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the company's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the company's auditors are aware of that information.

AUDITORS

The auditor, Murray Taylor, will be proposed for re-appointment at the forthcoming annual general meeting.

ON BEHALF OF THE BOARD:

J McKenzie - Director

28 September 2022

Opinion

We have audited the financial statements of Moness Group Limited (the 'company') for the year ended 31 December 2021 which comprise the Income Statement, Other Comprehensive Income, Statement of Financial Position, Statement of Changes in Equity, Statement of Cash Flows and Notes to the Statement of Cash Flows, 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 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 31 December 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.

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 Auditors' 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.

Conclusions relating to going concern

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.

Other information

The directors are responsible for the other information. The other information comprises the information in the Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether 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.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

-	the information given in the Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

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 Report of the Directors.

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.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page three, 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 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.

Auditors' responsibilities for the audit of the financial statements

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 a Report of the Auditors 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.

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

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.

The engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;

We identified the laws and regulations applicable to the company through discussions with directors and other management, and from our commercial knowledge and experience of the holiday resort sector.

We focused on specific laws and regulations which we considered may have a direct material effect on the financial statements or the operations of the company, including relevant legislation such as the Companies Act 2006, taxation legislation, data protection, employment and health and safety legislation.

We assessed the extent of compliance with the laws and regulations identified above through making enquiries of management and inspecting legal correspondence.

We assessed the susceptibility of the company's financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

- making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud;

- considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulation.

To address the risk of fraud through management bias and override of controls, we:

- performed analytical procedures to identify any unusual or unexpected relationships;

- tested journal entries to identify unusual transactions.

- investigated the rationale behind significant or unusual transactions;

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

- agreeing financial statement disclosures to underlying supporting documentation;

- enquiring of management as to actual and potential litigation and claims.

There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in a Report of the Auditors 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.

Robert Sim F.C.C.A. (Senior Statutory Auditor)

for and on behalf of Murray Taylor LLP

Statutory Auditor

10 Murray Lane

Montrose

Angus

DD10 8LF

29 September 2022

TURNOVER

2,931,730

2,242,326

Cost of sales

1,264,139

1,162,488

GROSS PROFIT

1,667,591

1,079,838

Administrative expenses

1,551,233

1,467,041

116,358

(387,203

)

Other operating income

404,026

402,934

OPERATING PROFIT

6

520,384

15,731

Interest payable and similar expenses

9

-

2,748

PROFIT BEFORE TAXATION

520,384

12,983

Tax on profit

10

13,867

1,918

PROFIT FOR THE FINANCIAL YEAR

506,517

11,065

PROFIT FOR THE YEAR

506,517

11,065

OTHER COMPREHENSIVE INCOME

-

-

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

506,517

11,065

FIXED ASSETS

Tangible assets

11

5,150,129

4,826,764

CURRENT ASSETS

Stocks

12

16,575

11,398

Debtors

13

131,632

492,326

Cash at bank and in hand

393,491

178,376

541,698

682,100

CREDITORS

Amounts falling due within one year

14

3,520,924

3,839,159

NET CURRENT LIABILITIES

(2,979,226

)

(3,157,059

)

TOTAL ASSETS LESS CURRENT LIABILITIES

2,170,903

1,669,705

PROVISIONS FOR LIABILITIES

17

222,259

227,578

NET ASSETS

1,948,644

1,442,127

CAPITAL AND RESERVES

Called up share capital

18

100

100

Revaluation reserve

19

704,000

704,000

Retained earnings

19

1,244,544

738,027

SHAREHOLDERS' FUNDS

1,948,644

1,442,127

The financial statements were approved by the Board of Directors and authorised for issue on 28 September 2022 and were signed on its behalf by:

J McKenzie - Director

Called up

share

Retained

Revaluation

Total

capital

earnings

reserve

equity

£

£

£

£

Balance at 1 January 2020

100

726,962

704,000

1,431,062

Changes in equity

Total comprehensive income

-

11,065

-

11,065

Balance at 31 December 2020

100

738,027

704,000

1,442,127

Changes in equity

Total comprehensive income

-

506,517

-

506,517

Balance at 31 December 2021

100

1,244,544

704,000

1,948,644

Cash flows from operating activities

Cash generated from operations

1

594,609

(146,737

)

Interest element of hire purchase or finance lease rental payments paid

-

(2,748

)

Net cash from operating activities

594,609

(149,485

)

Cash flows from investing activities

Purchase of tangible fixed assets

(551,763

)

(131,185

)

Sale of tangible fixed assets

-

32,831

Loan repayments in year

122,491

107,085

Net cash from investing activities

(429,272

)

8,731

Cash flows from financing activities

Capital repayments in year

-

(22,990

)

Amount withdrawn by directors

(169,076

)

(72,323

)

Government grants

218,854

332,303

Net cash from financing activities

49,778

236,990

Increase in cash and cash equivalents

215,115

96,236

Cash and cash equivalents at beginning of year

2

178,376

82,140

Cash and cash equivalents at end of year

2

393,491

178,376

1.	RECONCILIATION OF PROFIT BEFORE TAXATION TO CASH GENERATED FROM OPERATIONS

2021

2020

£

£

Profit before taxation

520,384

12,983

Depreciation charges

228,142

245,891

Loss/(profit) on disposal of fixed assets

256

(4,064

)

Government grants

(218,854

)

(332,303

)

Finance costs

-

2,748

529,928

(74,745

)

(Increase)/decrease in stocks

(5,177

)

5,900

(Increase)/decrease in trade and other debtors

(41,252

)

225,298

Increase/(decrease) in trade and other creditors

111,110

(303,190

)

Cash generated from operations

594,609

(146,737

)

2.	CASH AND CASH EQUIVALENTS

The amounts disclosed on the Statement of Cash Flows in respect of cash and cash equivalents are in respect of these Statement of Financial Position amounts:

Year ended 31 December 2021

31.12.21

1.1.21

£

£

Cash and cash equivalents

393,491

178,376

Year ended 31 December 2020

31.12.20

1.1.20

£

£

Cash and cash equivalents

178,376

82,140

3.	ANALYSIS OF CHANGES IN NET FUNDS

At 1.1.21

Cash flow

At 31.12.21

£

£

£

Net cash

Cash at bank and in hand

178,376

215,115

393,491

178,376

215,115

393,491

Total

178,376

215,115

393,491

1.	STATUTORY INFORMATION

Moness Group Limited is a private company, limited by shares , registered in Scotland. The company's registered number and registered office address can be found on the Company Information page.

2.	STATEMENT OF COMPLIANCE

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006.

3.	ACCOUNTING POLICIES

Basis of preparing the financial statements

The financial statements have been prepared under the historical cost convention as modified by the revaluation of certain assets.

The presentation currency is sterling.

Turnover

Turnover is measured at the fair value of the consideration received or receivable, excluding discounts, rebates, value added tax and other sales taxes.

Timeshare sales are recognised at the point of the members time at resort however are invoiced after the 14 day cooling off period following an agreed sale. Sales of food, beverage and accommodation rental is recognised on an accruals basis, it is recognised at the point services are provided to the guest. Where payments are received from customers in advance of services provided, the amounts are recorded as Deferred Income and included as part of Creditors due within one year. Where the deposit relates to a Third Party agent sale, Deferred Income is reduced accordingly until the amount is received from the Third Party agent.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.

Freehold land and buildings

-

2% on cost

Improvements to property

-

Straight line over 10 years and Straight line over 5 years

Plant and machinery

-

25% on cost

Fixtures and fittings

-

15% on cost, Straight line over 3 years, Straight line over 10 years, Straight line over 20 years and Straight line over 5 years

Motor vehicles

-

20% on cost

Computer equipment

-

25% on cost

Freehold land is not depreciated.

The directors have adopted the policy of revaluation in relation to freehold land and buildings. The director considers the useful life of freehold land and buildings to be 50 years from the date of revaluation.

The assets' residual values and useful lives are reviewed and adjusted, if appropriate, at the end of each reporting period. The effect of any change is accounted for prospectively

Government grants

Government grants are recognised based on the accrual model and are measured at the fair value of the asset received or receivable. Grants are classified as relating to either revenue or assets. Grants relating to revenue are recognised in income over the period in which the related costs are recognised. Grants relating to assets are recognised over the expected useful life of the asset. Where part of a grant relating to an asset is deferred, it is recognised as deferred income.

Stocks

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the statement of financial position date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the statement of financial position date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Hire purchase and leasing commitments

Assets obtained under hire purchase contracts or finance leases are capitalised in the balance sheet. Those held under hire purchase contracts are depreciated over their estimated useful lives. Those held under finance leases are depreciated over their estimated useful lives or the lease term, whichever is shorter.

The interest element of these obligations is charged to the profit and loss account over the relevant period. The capital element of the future payments is treated as a liability.

Rentals paid under operating leases are charged to the profit and loss account on a straight line basis over the period of the lease.

Pension costs and other post-retirement benefits

The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate.

4.	EMPLOYEES AND DIRECTORS

2021

2020

£

£

Wages and salaries

1,020,864

1,020,015

Social security costs

62,356

65,912

Other pension costs

17,570

17,465

1,100,790

1,103,392

The average number of employees during the year was as follows:

2021

2020

Operations

50

54

Administration

6

10

56

64

5.	DIRECTORS' REMUNERATION

2021

2020

£

£

Directors' remuneration

-

-

6.	OPERATING PROFIT

The operating profit is stated after charging/(crediting):

2021

2020

£

£

Hire of plant and machinery

48,506

41,813

Depreciation - owned assets

228,142

237,462

Depreciation - assets on hire purchase contracts or finance leases

-

8,427

Loss/(profit) on disposal of fixed assets

256

(4,064

)

Government grants

(218,854

)

(332,303

)

7.	AUDITORS' REMUNERATION

2021

2020

£

£

Fees payable to the company's auditors for the audit of the company's financial statements

5,500

4,050

8.	EXCEPTIONAL ITEMS

2021

2020

£

£

Exceptional items

(176,936

)

(108,036

)

9.

INTEREST PAYABLE AND SIMILAR EXPENSES

2021

2020

£

£

Hire purchase

-

2,748

10.

TAXATION

Analysis of the tax charge

The tax charge on the profit for the year was as follows:

2021

2020

£

£

Current tax:

UK corporation tax

19,185

-

Deferred tax

(5,318

)

1,918

Tax on profit

13,867

1,918

Reconciliation of total tax charge included in profit and loss

The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The difference is explained below:

2021

2020

£

£

Profit before tax

520,384

12,983

Profit multiplied by the standard rate of corporation tax in the UK of 19% (2020 - 19%)

98,873

2,467

Effects of:

Expenses not deductible for tax purposes

9,215

138

Income not taxable for tax purposes

-

(772

)

Capital allowances in excess of depreciation

(1,238

)

-

Depreciation in excess of capital allowances

-

1,571

Utilisation of tax losses

(74,412

)

(3,404

)

Deferred tax charge

(5,318

)

1,918

Group relief

(13,253

)

-

Total tax charge

13,867

1,918

11.	TANGIBLE FIXED ASSETS

Freehold

Improvements

land and

to

Plant and

buildings

property

machinery

£

£

£

COST OR VALUATION

At 1 January 2021

5,186,946

179,072

7,269

Additions

297,000

125,234

1,920

Disposals

-

-

(4,915

)

At 31 December 2021

5,483,946

304,306

4,274

DEPRECIATION

At 1 January 2021

789,117

70,274

5,311

Charge for year

99,932

21,031

740

Eliminated on disposal

-

-

(4,915

)

At 31 December 2021

889,049

91,305

1,136

NET BOOK VALUE

At 31 December 2021

4,594,897

213,001

3,138

At 31 December 2020

4,397,829

108,798

1,958