Central England Healthcare (Holdings) Limited - Period Ending 2022-02-28
Central England Healthcare (Holdings) Limited - Period Ending 2022-02-28
Registration number:
for the
Year Ended
Central England Healthcare (Holdings) Limited
Contents
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Company Information |
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Director's Report |
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Strategic Report |
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Statement of Director's Responsibilities |
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Independent Auditor's Report |
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Consolidated Profit and Loss Account |
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Consolidated Balance Sheet |
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Balance Sheet |
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Consolidated Statement of Changes in Equity |
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Statement of Changes in Equity |
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Consolidated Statement of Cash Flows |
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Notes to the Financial Statements |
Central England Healthcare (Holdings) Limited
Company Information
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Directors |
K K Kandola Dr S S Kandola S S Kandola |
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Company secretary |
S S Kandola |
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Registered office |
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Bankers |
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Auditors |
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Central England Healthcare (Holdings) Limited
Director's Report for the Year Ended 28 February 2022
The directors present their report and the for the year ended 28 February 2022.
Directors of the company
The directors who held office during the year were as follows:
Future developments
The external commercial environment is expected to remain competitive in the remainder of 2021. However, the director remains confident that the company will improve its current level of performance in the future and will continue to trade as a going concern.
Going concern
In the last quarter of the year there was a breach of the cash flow bank covenant. As the covenant breach was not identified until post year end the bank were unable to waive the breach pre year end. The bank continues to support the company and has waived the breach post year end. The future forecasts and cash flows of the company continue to support the going concern basis.
Disclosure of information to the auditor
Each director has taken the steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditor is aware of that information. The directors confirm that there is no relevant information that they know of and of which they know the auditor is unaware.
Reappointment of auditors
Hazlewoods LLP have expressed their willingness to continue in office.
Approved by the
.........................................
Director
Central England Healthcare (Holdings) Limited
Strategic Report for the Year Ended 28 February 2022
The directors present their strategic report for the year ended 28 February 2022.
Principal activity
The principal activity of the group is that of providing residential and nursing care to the elderly.
Fair review of the business
The results for the year, which are set out in the consolidated profit and loss account, show an operating profit of £2,755,333 (2021 - £1,769,204). At 28 February 2022, the group had intangible and tangible fixed assets valued in the financial statements at cost less amortisation/depreciation amounting to £12,449,347 (2021 - £12,464,695). The director considers the result for the year and the financial position of the group at the year end to be satisfactory.
Given the nature of the business, the group's director is of the opinion that key performance indicators are important. The group uses a number of indicators to monitor and improve development, performance or the position of the business, including occupancy, average fee rate, wages, overheads, EBITDA and debtor days. Indicators are reviewed and altered to meet changes both in the internal and external environments. The director does not consider the inclusion of an analysis using key performance indicators to be necessary to assist users of the financial statements in their understanding of the financial performance or position of the group.
Principal risks and uncertainties
The management of the business and the execution of the group's strategy are subject to a number of risks. The key business risks and uncertainties affecting the group are considered to relate to the continued provision of adequate government funding and the ongoing compliance with current and future legislation affecting the sector.
Financial instruments
Objectives and policies
The director constantly monitors the group's trading results and revises projections as appropriate to ensure that the company can meet its future obligations as they fall due.
Price risk, credit risk, liquidity risk and cash flow risk
The group is exposed to the usual credit and cash flow risk associated with selling on credit and manages this through credit control procedures. The financial instruments are subject to price risk and liquidity risk, as disclosed in note 17 to the financial statements
The group has sufficient resources available and continues to trade profitably generating cash. The director has prepared forecasts for the next 12 months that indicate that these trends will continue. The director therefore has a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future and has continued to adopt the going concern basis in preparing the financial statements.
Approved by the
.........................................
Director
Central England Healthcare (Holdings) Limited
Statement of Director's Responsibilities
The directors are responsible for preparing the Director's Report, the Strategic Report and the financial statements in accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the directors are required to:
• | select suitable accounting policies and apply them consistently; |
• | make judgements and accounting estimates that are reasonable and prudent; |
• | state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and |
• | 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 group's and the company's transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 group and the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Central England Healthcare (Holdings) Limited
Independent Auditor's Report to the Members of Central England Healthcare (Holdings) Limited
Opinion
We have audited the financial statements of Central England Healthcare (Holdings) Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 28 February 2022, which comprise the Consolidated Profit and Loss Account, Consolidated Balance Sheet, Balance Sheet, Consolidated Statement of Changes in Equity, Statement of Changes in Equity, Consolidated Statement of Cash Flows, and Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).
Basis for qualified opinion on financial statements
Qualified opinion on financial statements
In our opinion, except for the effects of the matter described in the Basis for Qualified Opinion paragraph, the financial statements:
• | give a true and fair view of the state of the group's and the parent company's affairs as at 28 February 2022 and of the group's 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 Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the group 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 director's 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 original financial statements were 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 included in the annual report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Central England Healthcare (Holdings) Limited
Independent Auditor's Report to the Members of Central England Healthcare (Holdings) Limited
Opinion on other matter prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
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• |
the information given in the Strategic Report and Director's Report for the financial year for which the financial statements are prepared is consistent with the financial statements; and |
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• |
the Strategic Report and Director's Report have been prepared in accordance with applicable legal requirements. |
Matters on which we are required to report by exception
In the light of our knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report and the Director's Report.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
• | adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or |
• | the parent company 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 Director's Responsibilities set out on page 4, 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 group’s and the parent 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 group or the parent company or to cease operations, or have no realistic alternative but to do so.
Auditor’s 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 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.
Central England Healthcare (Holdings) Limited
Independent Auditor's Report to the Members of Central England Healthcare (Holdings) Limited
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:
Owing to the inherent limitations of an audit, there is an unavoidable risk that material misstatements in the financial statements may not be detected, even though the audit is properly planned and performed in accordance with the ISA's (UK).
In identifying and assessing risks of material mis-statement in respect of fraud, including irregularities and non-compliance with laws and regulations, our procedures included the following:
• We obtained an understanding of the legal and regulatory frameworks applicable to the company financial statements or that had a fundamental effect on the company's operations. We determined that the most significant laws and regulations included UK GAAP, UK Companies Act 2006 and taxation laws.
• We understood how the company is complying with those legal and regulatory frameworks by making inquiries of management and those responsible for legal and compliance procedures.
• We assessed the susceptibility of the company's financial statements to material misstatement, including how fraud might occur.
Audit procedures performed by the engagement team included:
• Identifying and assessing the design effectiveness of controls management has in place to prevent and detect fraud;
• Understanding how those charged with governance considered and addressed the potential for override of controls or other inappropriate influence over the financial reporting process. Detailed analysis of journals posted through the accounting system during the year to 28 February 2021 has been undertaken;
• Understanding the controls in place to prevent and detect fraud. Reliance was not placed on controls for the entirety of the audit, instead taking a substantive testing approach, however controls were in place to prevent fraud, and they appeared to be working effectively;
• Challenging assumptions and judgements made by management in its significant accounting estimates.
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 auditor's report.
Use of our report
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
For and on behalf of
Windsor House
Bayshill Road
GL50 3AT
Central England Healthcare (Holdings) Limited
Consolidated Profit and Loss Account for the Year Ended 28 February 2022
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Note |
2022 |
2021 |
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|
Turnover |
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Other income |
535,705 |
474,653 |
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Cost of sales |
( |
( |
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Gross profit |
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|
|
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Administrative expenses |
( |
( |
|
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Exceptional items |
(54,108) |
(679,268) |
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|
Other operating income |
|
|
|
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Operating profit |
|
|
|
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Other interest receivable and similar income |
|
|
|
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Interest payable and similar charges |
( |
( |
|
|
Profit before tax |
|
|
|
|
Taxation |
( |
( |
|
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Profit for the financial year |
|
|
The above results were derived from continuing operations.
The group has no other comprehensive income for the year.
Central England Healthcare (Holdings) Limited
(Registration number: 11630122)
Consolidated Balance Sheet as at 28 February 2022
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Note |
2022 |
2021 |
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Fixed assets |
|||
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Intangible assets |
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|
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Tangible assets |
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|
|
|
|
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||
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Current assets |
|||
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Stocks |
|
|
|
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Debtors |
|
|
|
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Other financial assets |
|
- |
|
|
Cash at bank and in hand |
773,354 |
1,922,665 |
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|
|
|
||
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Creditors: Amounts falling due within one year |
( |
( |
|
|
Net current assets |
|
|
|
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Total assets less current liabilities |
|
|
|
|
Creditors: Amounts falling due after more than one year |
( |
( |
|
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Provisions for liabilities |
( |
( |
|
|
Net assets |
|
|
|
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Capital and reserves |
|||
|
Called up share capital |
|
|
|
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Retained earnings |
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|
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Total equity |
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|
Approved and authorised by the
Director
Central England Healthcare (Holdings) Limited
(Registration number: 11630122)
Balance Sheet as at 28 February 2022
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Note |
2022 |
2021 |
|
|
Fixed assets |
|||
|
Investments |
|
|
|
|
Current assets |
|||
|
Debtors: Amounts falling due within one year |
4,998,281 |
3,006,745 |
|
|
Cash at bank and in hand |
189,274 |
5,185 |
|
|
|
|
||
|
Creditors: Amounts falling due within one year |
( |
( |
|
|
Net current assets |
|
|
|
|
Total assets less current liabilities |
|
|
|
|
Creditors: Amounts falling due after more than one year |
( |
( |
|
|
Net assets |
|
|
|
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Capital and reserves |
|||
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Called up share capital |
|
|
|
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Retained earnings |
|
|
|
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Total equity |
|
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The company made a profit after tax for the financial year of £503,414 (2021 - profit of £358,398).
Approved and authorised by the
Director
Central England Healthcare (Holdings) Limited
Consolidated Statement of Changes in Equity for the Year Ended 28 February 2022
|
Share capital |
Retained earnings |
Total |
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|
At 1 March 2021 |
|
|
|
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Profit for the year |
- |
|
|
|
Dividends |
- |
( |
( |
|
At 28 February 2022 |
|
|
|
|
Share capital |
Retained earnings |
Total |
|
|
At 1 March 2020 |
|
|
|
|
Profit for the year |
- |
|
|
|
Dividends |
- |
( |
( |
|
At 28 February 2021 |
|
|
|
Central England Healthcare (Holdings) Limited
Statement of Changes in Equity for the Year Ended 28 February 2022
|
Share capital |
Retained earnings |
Total |
|
|
At 1 March 2021 |
|
|
|
|
Profit for the year |
- |
|
503,414 |
|
Dividends |
- |
( |
( |
|
At 28 February 2022 |
|
|
|
|
Share capital |
Retained earnings |
Total |
|
|
At 1 March 2020 |
|
|
|
|
Profit for the year |
- |
|
358,398 |
|
Dividends |
- |
( |
( |
|
At 28 February 2021 |
|
|
|
Central England Healthcare (Holdings) Limited
Consolidated Statement of Cash Flows for the Year Ended 28 February 2022
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Note |
2022 |
2021 |
|
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Cash flows from operating activities |
|||
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Profit for the year |
|
|
|
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Adjustments to cash flows from non-cash items |
|||
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Depreciation and amortisation |
|
|
|
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Impairment of other financial assets |
|
- |
|
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Finance income |
( |
( |
|
|
Finance costs |
|
|
|
|
Corporation tax expense |
|
|
|
|
|
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||
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Working capital adjustments |
|||
|
Increase in trade and other receivables |
( |
( |
|
|
Increase in trade and other payables |
|
|
|
|
Cash generated from operations |
|
|
|
|
Income taxes paid |
( |
( |
|
|
Net cash flow from operating activities |
|
|
|
|
Cash flows from investing activities |
|||
|
Interest received |
|
|
|
|
Acquisitions of property plant and equipment |
( |
( |
|
|
Purchase of other financial assets |
( |
- |
|
|
Net cash flows from investing activities |
( |
( |
|
|
Cash flows from financing activities |
|||
|
Interest paid |
( |
( |
|
|
Proceeds from bank borrowing draw downs |
357,852 |
11,256,411 |
|
|
Repayment of bank borrowing |
(738,734) |
(9,003,151) |
|
|
Payments to finance lease creditors |
( |
( |
|
|
Dividends paid |
( |
( |
|
|
Net cash flows from financing activities |
( |
|
|
|
Net (decrease)/increase in cash and cash equivalents |
( |
|
|
|
Cash and cash equivalents at 1 March |
|
|
|
|
Cash and cash equivalents at 28 February |
773,354 |
1,922,665 |
|
Central England Healthcare (Holdings) Limited
Notes to the Financial Statements for the Year Ended 28 February 2022
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General information |
The company is a private company, limited by shares incorporated and domiciled in England and Wales.
The address of its registered office is:
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Accounting policies |
Summary of significant accounting policies and key accounting estimates
The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.
Statement of compliance
These financial statements were prepared in accordance with Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'.
Basis of preparation
These financial statements have been prepared using the historical cost convention except for, where disclosed in these accounting policies, certain items that are shown at fair value.
The presentational currency of the financial statements is Pounds Sterling, being the functional currency of the primary economic environment in which the company operates. Monetary amounts in these financial statements are rounded to the nearest Pound.
Basis of consolidation
The consolidated financial statements consolidate the financial statements of the company and its subsidiary undertakings drawn up to 28 February 2022.
A subsidiary is an entity controlled by the company. Control is achieved where the company has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities.
The results of subsidiaries acquired or disposed of during the year are included in the Profit and Loss Account from the effective date of acquisition or up to the effective date of disposal, as appropriate. Where necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those used by the group.
The purchase method of accounting is used to account for business combinations that result in the acquisition of subsidiaries by the group. The cost of a business combination is measured as the fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the business combination. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. Any excess of the cost of the business combination over the acquirer’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities recognised is recorded as goodwill.
Inter-company transactions, balances and unrealised gains on transactions between the company and its subsidiaries, which are related parties, are eliminated in full.
Intra-group losses are also eliminated but may indicate an impairment that requires recognition in the consolidated financial statements.
Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the group. Non-controlling interests in the net assets of consolidated subsidiaries are identified separately from the group’s equity therein. Non-controlling interests consist of the amount of those interests at the date of the original business combination and the non-controlling shareholder’s share of changes in equity since the date of the combination.
Parent company profit
As permitted by Section 408 of the Companies Act 2006, the parent company’s statement of comprehensive income has not been included in these financial statements. The group profit for the period includes a profit of £503,414 (2021 - £358,398) dealt with in the profit and loss account of the parent company.
Central England Healthcare (Holdings) Limited
Notes to the Financial Statements for the Year Ended 28 February 2022
Going concern
After reviewing the company's forecasts and projections, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future. The company therefore continues to adopt the going concern basis in preparing its financial statements.
Judgements and estimation uncertainty and estimation uncertainty
These financial statements do not contain any significant judgements or estimation uncertainty. |
Revenue recognition
Turnover comprises the fair value of the consideration received or receivable for the provision of care in the ordinary course of the group’s activities. Where the amount covers the balance sheet date, the amount is apportioned over the period to which it relates.
The group recognises revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits will flow to the entity and specific criteria have been met for each of the group's activities.
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 either to revenue or to 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.
Tax
The tax expense for the period comprises current and deferred tax. Tax is recognised in the profit and loss account, except that a charge attributable to an item of income or expense recognised as other comprehensive income is also recognised directly in other comprehensive income.
The current tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date.
Deferred tax is recognised on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements and on unused tax losses or tax credits in the group. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the reporting date.
The carrying amount of deferred tax assets are reviewed at each reporting date and a valuation allowance is set up against deferred tax assets so that the net carrying amount equals the highest amount that is more likely than not to be recovered based on current or future taxable profit.
Tangible assets
Tangible assets are stated in the balance sheet at cost, less any subsequent accumulated depreciation and subsequent accumulated impairment losses.
The cost of tangible assets includes directly attributable incremental costs incurred in their acquisition and installation.
Depreciation
Depreciation is charged so as to write off the cost of assets, less any residual value, over their estimated useful lives, as follows:
|
Asset class |
Depreciation method and rate |
|
Land and buildings |
1% of cost |
|
Furniture, fittings and equipment |
15% reducing balance |
|
Freehold land |
nil |
Goodwill
Goodwill arising on the acquisition of an entity represents the excess of the cost of acquisition over the group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the entity recognised at the date of acquisition. Goodwill is initially recognised as an asset at cost and is subsequently measured at cost less accumulated amortisation and accumulated impairment losses.
Central England Healthcare (Holdings) Limited
Notes to the Financial Statements for the Year Ended 28 February 2022
Amortisation
Amortisation is provided on intangible assets so as to write off the cost, less any estimated residual value, over their useful life as follows:
|
Asset class |
Amortisation method and rate |
|
Goodwill |
10 years straight line |
Investments
Investments in equity shares which are not publicly traded and where fair value cannot be measured reliably are measured at cost less impairment.
Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.
Trade debtors
Trade debtors are amounts due from customers for care services performed in the ordinary course of business.
Trade debtors are recognised initially at the transaction price. All trade debtors are payable within one year and hence are included at the undiscounted amount of cash expected to be received. A provision for the impairment of trade debtors is established when there is objective evidence that the group will not be able to collect all amounts due according to the original terms of the receivables.
Stocks
Stocks are stated at the lower of cost and estimated selling price less costs to complete and sell.
Trade creditors
Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if the group does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date, they are presented as non-current liabilities.
Trade creditors are recognised initially at the transaction price and all are repayable within one year and hence are included at the undiscounted amount of cash expected to be paid.
Borrowings
Interest-bearing borrowings are initially recorded at fair value, net of transaction costs. Interest-bearing borrowings are subsequently carried at amortised cost, with the difference between the proceeds, net of transaction costs, and the amount due on redemption being recognised as a charge to the Profit and Loss Account over the period of the relevant borrowing.
Interest expense is recognised on the basis of the effective interest method and is included in interest payable and similar charges.
Borrowings are classified as current liabilities unless the group has an unconditional right to defer settlement of the liability for at least twelve months after the reporting date.
Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee.
Assets held under finance leases are recognised at the lower of their fair value at inception of the lease and the present value of the minimum lease payments. These assets are depreciated on a straight-line basis over the shorter of the useful life of the asset and the lease term. The corresponding liability to the lessor is included in the Balance Sheet as a finance lease obligation.
Lease payments are apportioned between finance costs in the Profit and Loss Account and reduction of the lease obligation so as to achieve a constant periodic rate of interest on the remaining balance of the liability.
Leases in which substantially all the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease.
Central England Healthcare (Holdings) Limited
Notes to the Financial Statements for the Year Ended 28 February 2022
Share capital
Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.
Dividends
Dividend distribution to the company’s shareholders is recognised as a liability in the financial statements in the reporting period in which the dividends are declared.
Defined contribution pension obligation
A defined contribution plan is a pension plan under which fixed contributions are paid into a pension fund and the group has no legal or constructive obligation to pay further contributions even if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.
Contributions to defined contribution plans are recognised as employee benefit expense when they are due. If contribution payments exceed the contribution due for service, the excess is recognised as a prepayment.
Financial instruments
Classification
Recognition and measurement
Central England Healthcare (Holdings) Limited
Notes to the Financial Statements for the Year Ended 28 February 2022
Financial instruments (continued)
Impairment
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.
The recoverable amount of goodwill is derived from measurement of the present value of the future cash flows of the cash-generating units ('CGUs') of which the goodwill is a part. Any impairment loss in respect of a CGU is allocated first to the goodwill attached to that CGU, and then to other assets within that CGU on a pro-rata basis.
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. Where a reversal of impairment occurs in respect of a CGU, the reversal is applied first to the assets (other than goodwill) of the CGU on a pro-rata basis and then to any goodwill allocated to that CGU.
Financial assets:
For financial assets carried at amortised cost, the amount of an 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.
|
Revenue |
The total turnover of the group for the year has been derived from care services wholly undertaken in the United Kingdom.
|
Other income |
The analysis of the group's other operating income for the year is as follows:
|
2022 |
2021 |
|
|
Infection control grant income |
451,508 |
325,640 |
|
Coronavirus job retention scheme income |
32,121 |
149,013 |
|
Workforce capacity fund income |
52,076 |
- |
|
Miscellaneous other operating income |
48,903 |
288,107 |
|
584,608 |
762,760 |
Central England Healthcare (Holdings) Limited
Notes to the Financial Statements for the Year Ended 28 February 2022
|
Exceptional items |
|
2022 |
2021 |
|
|
Exceptional items |
54,108 |
679,268 |
Exceptional items for the current year relate to an impairment of other financial assets. Exceptional items for the prior year relate to a provision for a related party balance.
|
Operating profit |
Arrived at after charging
|
2022 |
2021 |
|
|
Depreciation expense |
|
|
|
Amortisation expense |
|
|
|
Operating lease expense - property |
|
- |
|
Operating lease expense - plant and machinery |
|
|
|
Other interest receivable and similar income |
|
2022 |
2021 |
|
|
Interest income on bank deposits |
|
|
|
Interest payable and similar expenses |
|
2022 |
2021 |
|
|
Interest on bank overdrafts and borrowings |
|
|
|
Interest on obligations under finance leases and hire purchase contracts |
|
|
|
Other interest payable |
|
|
|
|
|
|
Staff costs |
The aggregate payroll costs (including directors' remuneration) were as follows:
|
2022 |
2021 |
|
|
Wages and salaries |
|
|
|
Social security costs |
|
|
|
Pension costs, defined contribution scheme |
|
|
|
|
|
The average number of persons employed by the group (including directors) during the year, analysed by category was as follows:
|
2022 |
2021 |
|
|
Administration and support |
|
|
|
Other departments |
|
|
|
|
|
Company
The company incurred no staff costs and had no employees other than the directors.
Central England Healthcare (Holdings) Limited
Notes to the Financial Statements for the Year Ended 28 February 2022
|
Directors' remuneration |
The directors' remuneration for the year was as follows:
|
2022 |
2021 |
|
|
Contributions paid to money purchase schemes |
|
- |
|
Auditors' remuneration |
|
2022 |
2021 |
|
|
Audit of these financial statements |
23,000 |
18,400 |
|
Other fees to auditors |
||
|
All other non-audit services |
|
|
|
Taxation |
Tax charged/(credited) in the profit and loss account
|
2022 |
2021 |
|
|
Current taxation |
||
|
UK corporation tax |
|
|
|
UK corporation tax adjustment to prior periods |
( |
( |
|
433,667 |
303,678 |
|
|
Deferred taxation |
||
|
Arising from origination and reversal of timing differences |
|
|
|
Tax expense in the income statement |
|
|
The tax on profit before tax for the year is the same as the standard rate of corporation tax in the UK (2021 - higher than the standard rate of corporation tax in the UK) of
The differences are reconciled below:
|
2022 |
2021 |
|
|
Profit before tax |
|
|
|
Corporation tax at standard rate |
|
|
|
Effect of (income)/expense not deductible in determining taxable profit |
|
|
|
Effect of tax losses |
( |
( |
|
Increase in UK and foreign current tax from adjustment for prior periods |
|
|
|
Tax decrease from effect of capital allowances and depreciation |
( |
( |
|
Total tax charge |
|
|
Central England Healthcare (Holdings) Limited
Notes to the Financial Statements for the Year Ended 28 February 2022
Deferred tax
Group
Deferred tax assets and liabilities
|
2022 |
Liability |
|
Difference between accumulated depreciation and amortisation and capital allowances |
|
|
Short term timing differences |
( |
|
Losses carried forwards |
- |
|
209,648 |
|
2021 |
Liability |
|
Difference between accumulated depreciation and amortisation and capital allowances |
|
|
Short term timing differences |
( |
|
Losses carried forwards |
- |
|
111,850 |
|
Intangible assets |
Group
|
Goodwill |
|
|
Cost |
|
|
At 1 March 2021 and 28 February 2022 |
|
|
Amortisation |
|
|
At 1 March 2021 |
|
|
Amortisation charge |
|
|
At 28 February 2022 |
|
|
Carrying amount |
|
|
At 28 February 2022 |
|
|
At 28 February 2021 |
|
Central England Healthcare (Holdings) Limited
Notes to the Financial Statements for the Year Ended 28 February 2022
|
Tangible assets |
Group
|
Freehold land and buildings |
Furniture, fittings and equipment |
Total |
|
|
Cost |
|||
|
At 1 March 2021 |
|
|
|
|
Additions |
|
|
|
|
At 28 February 2022 |
|
|
|
|
Depreciation |
|||
|
At 1 March 2021 |
|
|
|
|
Charge for the year |
|
|
|
|
At 28 February 2022 |
|
|
|
|
Carrying amount |
|||
|
At 28 February 2022 |
|
|
|
|
At 28 February 2021 |
|
|
|
Land of £1,490,000 (2021 - £1,490,000) has not been depreciated.
Assets held under finance leases and hire purchase contracts
The net carrying amount of tangible assets includes the following amounts in respect of assets held under finance leases and hire purchase contracts:
|
2022 |
2021 |
|
|
Furniture, fittings and equipment |
201,742 |
208,666 |
Central England Healthcare (Holdings) Limited
Notes to the Financial Statements for the Year Ended 28 February 2022
|
Investments |
Company
|
2022 |
2021 |
|
|
Investments in subsidiaries |
|
|
|
Subsidiaries |
£ |
|
Cost and net book value |
|
|
At 1 March 2021 and at 28 February 2022 |
|
Details of undertakings
Details of the investments in which the company holds 20% or more of the nominal value of any class of share capital are as follows:
|
Undertaking |
Country of incorporation |
Holding |
Proportion of voting rights and shares held |
|
|
2022 |
2021 |
|||
|
Subsidiary undertakings |
||||
|
|
England and Wales |
Ordinary |
|
|
|
|
England and Wales |
Ordinary |
|
|
|
|
England and Wales |
Ordinary |
|
|
|
|
England and Wales |
Ordinary |
|
|
|
|
England and Wales |
Ordinary |
|
|
The principal activity of all subsidiary undertakings is providing residential and nursing care to the eldery.
|
Stocks |
|
Group |
Company |
|||
|
2022 |
2021 |
2022 |
2021 |
|
|
Stocks |
9,000 |
9,000 |
- |
- |
Central England Healthcare (Holdings) Limited
Notes to the Financial Statements for the Year Ended 28 February 2022
|
Debtors |
|
Group |
Company |
||||
|
Note |
2022 |
2021 |
2022 |
2021 |
|
|
Trade debtors |
|
|
- |
- |
|
|
Directors loan account |
15,656 |
66,124 |
15,656 |
39,538 |
|
|
Other debtors |
|
|
|
|
|
|
Prepayments |
|
|
- |
- |
|
|
|
|
|
|
||
|
Creditors |
|
Group |
Company |
||||
|
Note |
2022 |
2021 |
2022 |
2021 |
|
|
Due within one year |
|||||
|
Loans and borrowings |
|
|
- |
- |
|
|
Trade creditors |
|
|
- |
- |
|
|
Social security and other taxes |
|
|
- |
- |
|
|
Outstanding defined contribution pension costs |
|
|
- |
- |
|
|
Other creditors |
|
|
|
|
|
|
Accrued expenses |
|
|
- |
- |
|
|
Corporation tax |
443,606 |
305,483 |
- |
- |
|
|
|
|
|
|
||
|
Due after one year |
|||||
|
Loans and borrowings |
|
|
- |
- |
|
|
Amounts owed to group undertakings |
- |
- |
4,078,676 |
2,393,478 |
|
|
Related party creditors |
|
|
|
|
|
|
12,720,116 |
12,831,654 |
5,062,246 |
2,918,535 |
||
Central England Healthcare (Holdings) Limited
Notes to the Financial Statements for the Year Ended 28 February 2022
|
Loans and borrowings |
|
Group |
Company |
|||
|
2022 |
2021 |
2022 |
2021 |
|
|
Current loans and borrowings |
||||
|
Bank borrowings |
|
|
- |
- |
|
HP and finance lease liabilities |
|
|
- |
- |
|
Other borrowings |
|
|
- |
- |
|
|
|
- |
- |
|
|
Group |
Company |
|||
|
2022 |
2021 |
2022 |
2021 |
|
|
Non-current loans and borrowings |
||||
|
Bank borrowings |
|
|
- |
- |
|
Hire purchase contracts |
|
|
- |
- |
|
|
|
- |
- |
|
Group and company
Bank borrowings
|
The bank loans incur interest at a rate of 2.35% above LIBOR and are secured against the homes owned by the borrowing companies, a mortgage debenture and by way of an intercompany guarantee. The loans are repayable in quarterly instalments up to 24 April 2025, when the loan falls due for repayment in full. |
|
Share capital |
Allotted, called up and fully paid shares
|
2022 |
2021 |
|||
|
No. |
£ |
No. |
£ |
|
|
|
|
180 |
|
180 |
|
|
|
10 |
|
10 |
|
|
|
10 |
|
10 |
|
|
|
|
|
|
Rights, preferences and restrictions
|
The different classes of shares rank pari passu in all respects other than dividend rights. |
Central England Healthcare (Holdings) Limited
Notes to the Financial Statements for the Year Ended 28 February 2022
|
Obligations under finance and operating leases |
Group
Finance leases
The total of future minimum lease payments is as follows:
|
2022 |
2021 |
|
|
Not later than one year |
|
|
|
Later than one year and not later than five years |
|
|
|
|
|
Operating leases
The total of future minimum lease payments is as follows:
|
2022 |
2021 |
|
|
Not later than one year |
|
|
|
Later than one year and not later than five years |
|
|
|
|
|
|
Pension and other schemes |
Defined contribution pension scheme
The group operates a defined contribution pension scheme. The pension cost charge for the year represents contributions payable by the group to the scheme and amounted to £
Contributions totalling £
|
Analysis of changes in net debt |
|
At 1 March 2021 |
Cash flows |
Non-cash flows |
At 28 February 2022 |
|
|
Cash and cash equivalents |
||||
|
Cash |
1,922,665 |
(1,149,486) |
- |
773,179 |
|
Borrowings |
||||
|
Bank borrowings |
(11,274,544) |
689,701 |
(306,398) |
(10,891,241) |
|
Other borrowings |
(5,030) |
(1,967) |
(453) |
(7,450) |
|
Lease liabilities |
(372,686) |
(136,257) |
41,942 |
(467,001) |
|
(11,652,260) |
551,477 |
(264,909) |
(11,365,692) |
|
|
( |
( |
( |
( |
|
|
|
||||
|
Dividends |
|
2022 |
2021 |
|
|
Dividend paid on Ordinary A shares |
471,500 |
282,000 |
Central England Healthcare (Holdings) Limited
Notes to the Financial Statements for the Year Ended 28 February 2022
|
Related party transactions |
Group and company
At the balance sheet date, the group was owed £15,656 (2021 - £66,124) from the directors in the form of a directors loan account. The loan is interest free and has no fixed repayment terms. The maximum loan in the year was £15,656 (2021 - £66,124).
There are no other key management personnel other than the director.
Other related party transactions
At the balance sheet date, the company owed £975,161 (2021 - £525,057) to Central England Healthcare (Great Wyrley) Limited, a company controlled by K Kandola and the group owed £2,502,169 (2021 - £1,987,185). These amounts are classified as non-current on the basis that the companies have confirmed unconditionally that the loans are repayable after more than one year. Interest of £49,000 (2021 - £11,646) has been charged to the company, and £164,000 (2021 - £117,883) charged to the group on these loans.
At the balance sheet date, the company was owed £4,744,739 (2021 - £2,967,207) and the group was owed £4,744,739 (2021 - £2,967,207) from other companies controlled by K Kandola. No interest was charged during the year on these balances.
|
Parent and ultimate parent undertaking |
The ultimate controlling party is