| Densems (Holdings) Limited |
| Notes to the Accounts |
| for the year ended 31 March 2022 |
|
| 1 |
Accounting policies |
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Basis of preparation |
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The accounts have been prepared under the historical cost convention subject to the revaluation of Investment Properties and in accordance with FRS 102, The Financial Reporting Standard applicable in the UK and Republic of Ireland (as applied to small entities by section 1A of the standard). |
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The comparative figures have been restated in accordance with FRS102 in respect of Deferred Tax on the unrealised surplus on the revaluation of Investment Properties. |
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The accounts have been prepared treating the company as a going concern under the historical cost convention modified by the revaluation of investment properties and are in respect of the year ended 31 March 2022 with comparatives for the year ended 31 March 2021. Entities are required to adopt the going concern basis of accounting, except in circumstances where the company determine at the date of approval of the accounts that it is not acceptable. The future is still uncertain due to the effect of Coronavirus pandemic and may be out of our control. Given the unknown future impact that COVID-19 might have on the company, we have only been able to look at the position since the year-end up to the current date. At present the director has carried out an assessment and believes the company is willing and able to stay in business for the foreseeable future covering at least 12 months from approval of these accounts subject to the above. This basis has been adopted by the board as a result of its forward review of the companies activities for the next year. The board believes this basis is acceptable for at least the next 12 months. No adjustment has been made for any effect of the COVID-19 pandemic on property values (Note 2) |
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Turnover - Property Rental Income |
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Turnover is measured at the fair value of the consideration received or receivable. Turnover is recognised when the significant risks and rewards of rental period of the tenancy have arisen. |
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Repairs and Maintenance |
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Cost of work on property is charged as incurred. Where properties become empty during the year costs of refurbishment ready for letting are charged to the Revenue Account. |
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Investment Income |
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Dividends and interest receiveable are included in the income of the year. |
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Tangible fixed assets |
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Tangible fixed assets are measured at cost less accumulative depreciation and any accumulative impairment losses. Depreciation is provided on all tangible fixed assets, other than Investment Property, at rates calculated to write off the cost, less estimated residual value, of each asset evenly over its expected useful life, as follows: |
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Investment Property |
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This is initially recognised at cost and then subsequently is stated at the valuation considered by directors annually from the knowledge of the properties and local market with reference to externally valued at intervals. These properties are held for investment return in the form of rents etc. |
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In accordance with the requirements of Financial Reporting Standards depreciation is no longer chargeable on properties held as investments and annual valuation carried out. |
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Debtors |
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Short term debtors are measured at transaction price, less any impairment losses for bad and doubtful debts. |
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Creditors |
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Short term creditors are measured at transaction price (which is usually the invoice price). Loans and other financial liabilities are initially recognised at transaction price net of any transaction costs. |
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Taxation |
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A current tax liability is recognised for the tax payable on the taxable profit of the current and past periods. Deferred tax is recognised in respect of all timing differences between the recognition of income and expenses in the financial statements and their inclusion in tax assessments. 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. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date and that are expected to apply to the reversal of the timing difference, except for revalued land and investment property where the tax rate that applies to the sale of the asset is used. Current and deferred tax assets and liabilities are not discounted. |
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Provision for taxation is made on the surplus which would arise if freehold investment properties were sold at their revalued amounts. Under FRS102 Section 1a deferred tax on unrealised revaluation surplus has to be recognised in the accounts. |
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Cash Flow Statement |
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The company has taken advantage of the exemption in Financial Reporting Standard No. 1 not to produce this statement on the grounds it is a small company. |
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| 2 |
Fixed assets - Investments |
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Land and buildings |
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|
2022 |
|
2021 |
| £ |
£ |
|
Fair Value |
|
At 1 April 2021 |
2,939,213 |
|
3,250,000 |
|
Disposal at valuation |
- |
|
(317,012) |
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At 31 March 2022 |
2,939,213 |
|
2,932,988 |
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Depreciation |
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At 31 March 2022 |
- |
|
- |
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Net book value |
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At 31 March 2022 |
2,939,213 |
|
2,932,988 |
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At 31 March 2021 |
2,932,988 |
|
3,250,000 |
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Freehold land and buildings: |
2022 |
|
2021 |
| £ |
£ |
|
Historical cost |
662,278 |
|
662,278 |
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Cumulative depreciation based on historical cost |
- |
|
- |
|
|
|
|
|
|
|
662,278 |
|
662,278 |
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The property holdings were independently valued as investment properties by Mr G Scott-Brooker BSc FRICS DipNDEA of Brooker & Co Chartered Surveyors, 12A Pepper Street, Nantwich, Cheshire CW5 5AB - RICS Registered Valuers. He has stated the valuation prepared was on the basis of Fair Value, as defined by the RICS and IVSC and was prepared in accordance with the RICS Valuation - Global Standards 2017 . The report was dated 24th July 2019 and has been used as the year end valuation at 2019. |
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The disposals in the 2021 year were accounted for at the valuation at 01/04/2019. The directors have considered the present position as of 31 March 2022 and left the valuations per property as last year. No adjustment has been made for the effect, negative or positive, "COVID 19" may have on property values as the future is uncertain. Hence these valuations may need revision once a stable situation is available, but are not considered materially different at 31/03/2021. |
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The company has no capital committment's contracted for or otherwise (2021 (£Nil). An estimate of £50,000 (2021 £42,000) is needed on remedial works highlighted at the year end. |
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| 3 |
Debtors |
2022 |
|
2021 |
| £ |
£ |
|
Trade debtors |
- |
|
2,515 |
|
Other debtors |
15,782 |
|
20,448 |
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|
15,782 |
|
22,963 |
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| 4 |
Creditors: amounts falling due within one year |
2022 |
|
2021 |
| £ |
£ |
|
Bank loans |
note 5 |
8,000 |
|
- |
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Other taxes and social security costs |
637 |
|
111 |
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Other creditors |
55,488 |
|
40,562 |
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|
64,125 |
|
40,673 |
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| 5 |
Creditors: amounts falling due after one year |
2022 |
|
2021 |
| £ |
£ |
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Bank loans - COVID bounce back loan |
26,669 |
|
40,000 |
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Term 6 years from 08/06/2020. Repayments start 07/08/2021 for 5 years in the sum of £667 plus interest from that date of 2.5% p.a. Total outstanding £34,669 (2021 £40,000) |
| 6 |
Taxation |
2022 |
|
2021 |
|
Analysis of charge in period |
£ |
£ |
|
Current tax: |
|
UK Corporation tax on (loss)/profits of the period |
- |
|
Adjustments in respect of previous periods |
(79) |
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|
|
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|
- |
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(79) |
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Deferred tax: |
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On unrealised surplus on revaluation |
- |
|
(14,012) |
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Tax on profit on ordinary activities |
- |
|
(14,091) |
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Factors affecting tax charge for period |
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The differences between tax assessed for the period and the standard rate of corporation tax are explained as follows: |
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|
2022 |
|
2021 |
| £ |
£ |
|
(Loss)/Profit on ordinary activities before tax |
66,451 |
|
(73,746) |
|
Standard rate of corporation tax in the UK |
|
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Profit on ordinary activities multiplied by the standard rate of corporation tax |
|
12,626 |
|
(14,012) |
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Effects of: |
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Expenses now claimed for tax purposes |
(12,784) |
|
(14,170) |
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Deferred tax on surplus on realisation / revaluation |
- |
|
Deferred tax credit on loss in the year |
14,012 |
|
Effective rate change on surplus on revaluation |
- |
|
- |
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Adjustments to tax charge in respect of previous periods |
79 |
|
Current tax charge for period |
- |
|
(14,091) |
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Deferred tax liabilty |
£ |
£ |
|
Balance 1 April 2021 |
346,588 |
|
360,600 |
|
(Credit) / charge for the year |
- |
|
(14,012) |
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Balance 1 April 2022 |
346,588 |
|
346,588 |
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The credit to deferred tax is anticipated will be recovered against tax on 2022 surplus. |
|
| 7 |
Share capital |
Nominal |
|
2022 |
|
2022 |
|
2021 |
| Value |
Number |
£ |
£ |
|
Alloted, called up and fully paid |
|
Ordinary shares |
£1 each |
|
14,000 |
|
14,000 |
|
14,000 |
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| 8 |
Revaluation reserve |
2022 |
|
2021 |
| £ |
£ |
|
At 1 April 2021 |
1,935,375 |
|
1,935,375 |
|
transfer realised revaluation surplus |
- |
|
- |
|
Deferred Tax charge on surplus on revaluation |
- |
|
At 31 March 2022 |
1,935,375 |
|
1,935,375 |
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| 9 |
Dividends |
2022 |
|
2021 |
| £ |
£ |
|
Dividends for which the company became liable during the year: |
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Dividends paid |
54,715 |
|
27,357 |
|
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| 10 |
Related party transactions |
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There were no related party transactions to report. |
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| 11 |
Average number of employees |
|
|
|
|
2022 |
|
2021 |
|
current year |
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4 |
|
previous year |
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4 |
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| 12 |
Ultimate controlling party |
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There is no ultimate controlling party. |
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| 13 |
Other information |
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Densems (Holdings) Limited is a private company limited by shares and incorporated in England. Its registered office is: 71 New Barn Lane, Cheltenham, Gloucester GL52 3LB . Its Registered number is 00504273. |
