Northwood Schools Limited - Period Ending 2021-08-31
Northwood Schools Limited - Period Ending 2021-08-31
Registration number:
for the
Year Ended
Northwood Schools Limited
Contents
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Company Information |
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Directors' Report |
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Strategic Report |
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Statement of Directors' 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 |
Northwood Schools Limited
Company Information
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Directors |
A N Hassan J A Pickles |
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Registered office |
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Auditors |
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Northwood Schools Limited
Directors' Report for the Year Ended 31 August 2021
The directors present their report and the for the year ended 31 August 2021.
Directors of the company
The directors who held office during the year were as follows:
The following directors were appointed after the year end:
The directors confirm their understanding of their responsibilities as outlined on page 5.
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.
Appointment of auditors
Grant Thornton UK LLP have been appointed as auditors of the company during the period, following the resignation of Goldwyns Chartered Accountants, and have expressed their willingness to continue in office.
Approved by the
Director
Northwood Schools Limited
Strategic Report for the Year Ended 31 August 2021
The directors present their strategic report for the year ended 31 August 2021.
Principal activity
The principal activity of the group is the provision of educational services. The company is a dormant holding company.
Fair review of the business
The results for the year, which are set out in the profit and loss account show turnover of £14,588,436 (2020 - £14,735,024) and an operating profit of £203,269 (2020 - loss of £59,332). At 31 August 2021, the group had net assets of £6,855,488 (2020 - £6,656,201). The directors consider the performance for the year and the financial position at the year end to be satisfactory. On 20 September 2021 the group was sold to Dukes Schools Ltd, a subsidiary of Dukes Education Group Ltd.
Key performance indicators
Given the nature of the business, the Company's directors are of the opinion that key performance indicators are important. The Group uses a number of indicators to monitor and improve the development, performance or the position of the business. Indicators are reviewed and altered to meet changes both in the internal and external environments. The main key performance indicators used by the Group are turnover and EBITDA which can be seen above. The non financial key performance indicators used by the Group are pupil numbers.
The company's key performance indicators during the year were as follows:
|
Unit |
2021 |
2020 |
|
|
Pupil number |
FTE |
764 |
827 |
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 global economic conditions and the on going compliance with current and future legislation affecting the sector.
Financial instruments
Objectives and policies
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 nature of its financial instruments means that price and liquidity risks are minimised by the predetermination of the group funding facilities and terms. The board constantly monitors the group’s trading results and revise projections as appropriate to ensure that the group can meet its future obligations as they fall due.
Price risk, credit risk, liquidity risk and cash flow risk
The business’ principal financial instruments comprise bank balances, trade debtors and trade creditors. The main purpose of these instruments is to finance the business’ operations.
In respect of bank balances, the liquidity risk is managed by maintaining a balance between the continuity of funding and flexibility, through the use of overdrafts at floating rates of interest. 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 facilities 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.
The group has sufficient resources available and the directors have prepared forecasts for the next 12 months that indicate that this will continue to be the case and that these cash flows will be sufficient for the group to meet its financing commitments as they fall due. The directors therefore have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future and have continued to adopt the going concern basis in preparing the financial statements.
Northwood Schools Limited
Strategic Report for the Year Ended 31 August 2021
Future developments
The external environment is expected to remain competitive going forward, however, the directors are confident that the group will continue to improve the current level of performance in the future.
Approved by the
Director
Northwood Schools Limited
Statement of Directors' Responsibilities
The directors are responsible for preparing the Directors' Report, 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.
Northwood Schools Limited
Independent Auditor's Report to the Members of Northwood Schools Limited
Opinion
We have audited the financial statements of Northwood Schools Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 August 2021, 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).
In our opinion the financial statements:
• | give a true and fair view of the state of the group's and the parent company's affairs as at 31 August 2021 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
We are responsible for concluding on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify the auditor’s opinion. Our conclusions are based on the audit evidence obtained up to the date of our report. However, future events or conditions may cause the company to cease to continue as a going concern.
In our evaluation of the directors’ conclusions, we considered the inherent risks associated with the company’s business model including effects arising from macro-economic uncertainties such as Brexit and Covid-19, we assessed and challenged the reasonableness of estimates made by the directors and the related disclosures and analysed how those risks might affect the company’s financial resources or ability to continue operations over the going concern period.
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.
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.
The responsibilities of the directors with respect to going concern are described in the ‘Responsibilities of directors for the financial statements’ section 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.
Northwood Schools Limited
Independent Auditor's Report to the Members of Northwood Schools Limited
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.
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 Directors' 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 Directors' Report have been prepared in accordance with applicable legal requirements. |
Matter on which we are required to report under the Companies Act 2006
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 Directors' Report.
Matters on which we are required to report by exception
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 Directors' Responsibilities set out on page 5, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the 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.
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.
Northwood Schools Limited
Independent Auditor's Report to the Members of Northwood Schools Limited
Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud
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. 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 ISAs (UK).
The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:
• We obtained an understanding of how the Group is complying with significant legal and regulatory frameworks through inquiries of management;
• The Group is subject to many laws and regulations where the consequences of non-compliance could have a material effect on amounts or disclosures in the financial statements. We identified Financial Reporting Standard 102 and the Companies Act 2006, along with legislation relating to employment, health and safety, data protection and environmental issues, as those most likely to have a material effect if non-compliance were to occur;
• We communicated relevant laws and potential fraud risks to all engagement team members and remained alert to any indicators of fraud or non-compliance with laws and regulations throughout the audit;
• We assessed the susceptibility of the Group’s financial statements to material misstatement, including how fraud might occur. We considered the opportunity and incentives for management to perpetrate fraud, and the potential impact on the financial statements;
• These audit procedures were designed to provide reasonable assurance that the financial statements were free from fraud or error. The risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error and detecting irregularities that result from fraud is inherently more difficult than detecting those that result from error, as fraud may involve collusion, deliberate concealment, forgery or intentional misrepresentations. Also, the further removed non-compliance with laws and regulations is from events and transactions reflected in the financial statements, the less likely we would become aware of it.
In assessing the potential risks of material misstatement, we obtained an understanding of:
• the Group’s operations, including the nature of its revenue sources, products, and services and of its objectives and strategies to understand the classes of transactions, account balances, expected financial statement disclosures and business risks that may result in risks of material misstatement;
• the Group’s control environment
• the Group’s relevant controls over areas of significant risks; and
• the Group’s business processes in respect of classes of transactions that are significant to the financial statements.
Audit procedures performed by the engagement team included:
• identifying the significant risk of fraud within revenue recognition and undertaking substantive testing to obtain sufficient and appropriate audit evidence;
• testing manual journal entries, in particular journal entries relating to management estimates and entries determined to be large or relating to unusual transactions; and
• identifying and testing related party transactions.
Assessment of the appropriateness of the collective competence and capabilities of the engagement team included:
• consideration of the engagement team's understanding of, and practical experience with, audit engagements of a similar nature and complexity;
• appropriate training, knowledge of the industry in which the Group operates; and
• understanding of the legal and regulatory requirements specific to the Group.
We did not identify any material matters relating to non-compliance with laws and regulations or relating to fraud.
Northwood Schools Limited
Independent Auditor's Report to the Members of Northwood Schools Limited
A further description of our responsibilities is available on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
Northwood Schools Limited
Independent Auditor's Report to the Members of Northwood Schools Limited
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
3 Callaghan Square
CF10 5BT
Northwood Schools Limited
Consolidated Profit and Loss Account for the Year Ended 31 August 2021
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Note |
2021 |
2020 |
|
|
Turnover |
|
|
|
|
Cost of sales |
( |
( |
|
|
Gross profit |
|
|
|
|
Administrative expenses |
( |
( |
|
|
Other operating income |
|
|
|
|
Operating profit/(loss) |
|
( |
|
|
Other interest receivable and similar income |
|
|
|
|
Interest payable and similar charges |
- |
( |
|
|
Profit before tax |
|
|
|
|
Taxation |
( |
( |
|
|
Profit for the financial year |
|
|
The above results were derived from continuing operations.
The group has no other comprehensive income for the year.
Northwood Schools Limited
(Registration number: 04815261)
Consolidated Balance Sheet as at 31 August 2021
|
Note |
2021 |
2020 |
|
|
Fixed assets |
|||
|
Tangible assets |
|
|
|
|
Current assets |
|||
|
Debtors |
|
|
|
|
Cash at bank and in hand |
2,033,953 |
1,854,095 |
|
|
|
|
||
|
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 |
|
|
|
|
Capital and reserves |
|||
|
Called up share capital |
|
|
|
|
Profit and loss account |
|
|
|
|
Equity attributable to owners of the company |
|
|
|
|
Total equity |
|
|
Approved and authorised by the
Director
Northwood Schools Limited
(Registration number: 04815261)
Balance Sheet as at 31 August 2021
|
Note |
2021 |
2020 |
|
|
Fixed assets |
|||
|
Investments |
|
|
|
|
Capital and reserves |
|||
|
Called up share capital |
|
|
|
|
Total equity |
|
|
The company made a profit after tax for the financial year of £nil (2020 - profit of £134,336).
Approved and authorised by the
Director
Northwood Schools Limited
Consolidated Statement of Changes in Equity for the Year Ended 31 August 2021
Equity attributable to the parent company
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Share capital |
Profit and loss account |
Total |
|
|
At 1 September 2020 |
|
|
|
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Profit for the year |
- |
|
|
|
At 31 August 2021 |
|
|
|
|
Share capital |
Profit and loss account |
Total |
|
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At 1 September 2019 |
|
|
|
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Profit for the year |
- |
|
|
|
Dividends |
- |
( |
( |
|
At 31 August 2020 |
|
|
|
Northwood Schools Limited
Statement of Changes in Equity for the Year Ended 31 August 2021
|
Share capital |
Profit and loss account |
Total |
|
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At 1 September 2020 and at 31 August 2021 |
|
- |
|
|
Share capital |
Profit and loss account |
Total |
|
|
At 1 September 2019 |
|
- |
|
|
Profit for the year |
- |
|
|
|
Dividends |
- |
( |
( |
|
At 31 August 2020 |
|
- |
|
Northwood Schools Limited
Consolidated Statement of Cash Flows for the Year Ended 31 August 2021
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Note |
2021 |
2020 |
|
|
Cash flows from operating activities |
|||
|
Profit for the year |
|
|
|
|
Adjustments to cash flows from non-cash items |
|||
|
Depreciation and amortisation |
|
|
|
|
Finance income |
( |
( |
|
|
Finance costs |
- |
|
|
|
Income tax expense |
|
|
|
|
|
|
||
|
Working capital adjustments |
|||
|
Decrease/(increase) in debtors |
|
( |
|
|
Decrease in creditors |
( |
( |
|
|
Cash generated from operations |
|
( |
|
|
Income taxes paid |
( |
( |
|
|
Net cash flow from operating activities |
|
( |
|
|
Cash flows from investing activities |
|||
|
Interest received |
|
|
|
|
Acquisitions of tangible assets |
( |
( |
|
|
Net cash flows from investing activities |
( |
( |
|
|
Cash flows from financing activities |
|||
|
Interest paid |
- |
( |
|
|
Directors loan accounts |
- |
82,490 |
|
|
Dividends paid |
- |
( |
|
|
Net cash flows from financing activities |
- |
( |
|
|
Net increase/(decrease) in cash and cash equivalents |
|
( |
|
|
Cash and cash equivalents at 1 September |
|
|
|
|
Cash and cash equivalents at 31 August |
2,033,953 |
1,854,095 |
|
Northwood Schools Limited
Notes to the Financial Statements for the Year Ended 31 August 2021
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General information |
The company is a private company limited by share capital, incorporated 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' and the Companies Act 2006.
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 31 August 2021.
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.
Northwood Schools Limited
Notes to the Financial Statements for the Year Ended 31 August 2021
Parent Company profit
|
As permitted by section 408 of the Companies Act 2006, the parent profit and loss account has not been included in these financial statements. The Group profit for the year includes a profit of £nil (2020 - profit of £134,336) dealt with in the profit and loss of the parent Company. |
Going concern
The group meets its day-to-day working capital requirements through the use of the group’s bank facilities. The current demand for the educational services offered by the group continue to remain strong. The group’s forecasts and projections, taking account of reasonable fluctuations in student numbers and expected demand for its educational services, show that the group should be able to operate within the level of the group’s cash reserves and bank facilities. After making enquiries, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. The group therefore continues to adopt the going concern basis in preparing its financial statements.
Critical accounting judgements and key sources of estimation uncertainty
In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
Depreciation
Tangible assets are depreciated over their useful lives taking into account residual values, where appropriate. The actual lives of the assets and residual values are assessed annually and may vary depending on a number of factors.
Revenue recognition
Revenue represents amounts receivable for school fees, events, and other services delivered during the year.
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the company and the revenue can be reliably measured.
School fees are recognised on a straight line basis over the academic year (1 September to 31 August) to which they relate. Revenue for events or other services is recognised when the event has taken place or the service has been delivered.
Revenue is measured at the fair value of the consideration received or receivable, net of any rebates or discounts.
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.
Northwood Schools Limited
Notes to the Financial Statements for the Year Ended 31 August 2021
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 in the countries where the group operates and generates taxable income.
Deferred tax is recognised on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements and on unused tax losses or tax credits in the company. 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, other than land and properties under construction over their estimated useful lives, as follows:
|
Asset class |
Depreciation method and rate |
|
Improvements to leasehold property |
Over the term of the lease |
|
Classrooms |
15% straight line |
|
Plant and machinery |
15% straight line |
|
Fixtures and fittings |
15% straight line |
|
Motor vehicles |
25% straight line |
|
Computer equipment |
33.33% straight line |
Business combinations
Business combinations are accounted for using the purchase method. The consideration for each acquisition is measured at the aggregate of the fair values at acquisition date of assets given, liabilities incurred or assumed, and equity instruments issued by the group in exchange for control of the acquired, plus any costs directly attributable to the business combination. When a business combination agreement provides for an adjustment to the cost of the combination contingent on future events, the group includes the estimated amount of that adjustment in the cost of the combination at the acquiisition date if the adjustment is probable and can be measured reliably.
Investments
Investments in equity shares which are publicly traded or where the fair value can be measured reliably are initially measured at fair value, with changes in fair value recognised in profit or loss. Investments in equity shares which are not publicly traded and where fair value cannot be measured reliably are measured at cost less impairment.
Interest income on debt securities, where applicable, is recognised in income using the effective interest method. Dividends on equity securities are recognised in income when receivable.
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.
Northwood Schools Limited
Notes to the Financial Statements for the Year Ended 31 August 2021
Debtors
Trade debtors are amounts due from customers for services performed in the ordinary course of business.
Trade debtors are recognised initially at the transaction price. All trade debtors are repayable within one year and hence are included at the undiscounted cost 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 debtors.
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.
Leases
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.
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.
Northwood Schools Limited
Notes to the Financial Statements for the Year Ended 31 August 2021
Financial instruments
Classification
Recognition and measurement
Impairment
A non financial 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.
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 company has been derived from its principal activity wholly undertaken in the United Kingdom.
|
Other operating income |
The analysis of the group's other operating income for the year is as follows:
|
2021 |
2020 |
|
|
Government grants |
54,381 |
327,578 |
Northwood Schools Limited
Notes to the Financial Statements for the Year Ended 31 August 2021
|
Operating profit |
Arrived at after charging
|
2021 |
2020 |
|
|
Depreciation expense |
|
|
|
Operating lease expense - property |
|
|
|
Other interest receivable and similar income |
|
2021 |
2020 |
|
|
Interest income on investments |
103,401 |
119,096 |
|
Interest income on bank deposits |
|
|
|
|
|
|
Interest payable and similar expenses |
|
2021 |
2020 |
|
|
Interest expense on other finance liabilities |
- |
|
|
Staff costs |
Group
The aggregate payroll costs (including directors' remuneration) were as follows:
|
2021 |
2020 |
|
|
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:
|
2021 |
2020 |
|
|
Management, teachers and administration. |
|
|
Company
The company incurred no staff costs and had no employees other than the directors.
|
Directors' remuneration |
The directors' remuneration for the year was as follows:
|
2021 |
2020 |
|
|
Remuneration |
|
|
Northwood Schools Limited
Notes to the Financial Statements for the Year Ended 31 August 2021
During the year the number of directors who were receiving benefits and share incentives was as follows:
|
2021 |
2020 |
|
|
Accruing benefits under money purchase pension scheme |
|
|
|
Auditors' remuneration |
|
2021 |
2020 |
|
|
Audit of these financial statements |
33,990 |
48,135 |
|
Taxation |
Tax charged/(credited) in the profit and loss account
|
2021 |
2020 |
|
|
Current taxation |
||
|
UK corporation tax |
|
|
|
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 higher than the standard rate of corporation tax in the UK (2020 - higher than the standard rate of corporation tax in the UK) of
The differences are reconciled below:
|
2021 |
2020 |
|
|
Profit before tax |
|
|
|
Corporation tax at standard rate |
|
|
|
Effect of expense not deductible in determining taxable profit (tax loss) |
|
|
|
Tax increase/(decrease) from effect of capital allowances and depreciation |
|
( |
|
Tax decrease from changes in pension fund creditor |
- |
( |
|
Other tax effects for reconciliation between accounting profit and tax expense (income) |
- |
( |
|
Total tax charge |
|
|
Deferred tax
Group
Deferred tax assets and liabilities
|
2021 |
Asset |
|
Accelerated capital allowances |
|
Northwood Schools Limited
Notes to the Financial Statements for the Year Ended 31 August 2021
|
2020 |
Asset |
|
Accelerated capital allowances |
|
Northwood Schools Limited
Notes to the Financial Statements for the Year Ended 31 August 2021
|
Tangible assets |
Group
|
Improvements to leasehold property |
Furniture, fittings and equipment |
Motor vehicles |
Total |
|
|
Cost |
||||
|
At 1 September 2020 |
|
|
|
|
|
Additions |
|
|
- |
|
|
Disposals |
- |
- |
( |
( |
|
At 31 August 2021 |
|
|
|
|
|
Depreciation |
||||
|
At 1 September 2020 |
|
|
|
|
|
Charge for the year |
|
|
|
|
|
Eliminated on disposal |
- |
- |
( |
( |
|
At 31 August 2021 |
|
|
|
|
|
Carrying amount |
||||
|
At 31 August 2021 |
|
|
|
|
|
At 31 August 2020 |
|
|
|
|
Northwood Schools Limited
Notes to the Financial Statements for the Year Ended 31 August 2021
|
Investments |
Company
|
2021 |
2020 |
|
|
Investments in subsidiaries |
|
|
|
Subsidiaries |
£ |
|
Cost and carrying amount |
|
|
At 1 September 2020 and at 31 August 2021 |
|
Details of undertakings
Details of the investments (including principal place of business of unincorporated entities) in which the company holds 20% or more of the nominal value of any class of share capital are as follows:
|
Undertaking |
Registered office |
Holding |
Proportion of voting rights and shares held |
||||
|
2021 |
2020 |
||||||
|
Subsidiary undertakings |
|||||||
|
|
England and Wales |
|
|
|
|||
|
|
England and Wales |
|
|
|
|||
|
Subsidiary undertakings |
|
Broomwood Hall School Limited The principal activity of Broomwood Hall School Limited is |
|
Northcote Lodge School Limited The principal activity of Northcote Lodge School Limited is |
|
Debtors |
|
Group |
Company |
||||
|
Note |
2021 |
2020 |
2021 |
2020 |
|
|
Trade debtors |
|
|
- |
- |
|
|
Other debtors |
|
|
- |
- |
|
|
Directors' current accounts |
- |
4,754,225 |
- |
- |
|
|
Amounts owed by related parties |
|
- |
- |
- |
|
|
Corporation tax asset |
|
|
- |
- |
|
|
Deferred tax assets |
|
|
- |
- |
|
|
Prepayments |
|
|
- |
- |
|
|
|
|
- |
- |
||
Northwood Schools Limited
Notes to the Financial Statements for the Year Ended 31 August 2021
|
Creditors |
|
Group |
Company |
||||
|
Note |
2021 |
2020 |
2021 |
2020 |
|
|
Due within one year |
|||||
|
Trade creditors |
|
|
- |
- |
|
|
Social security and other taxes |
|
|
- |
- |
|
|
Outstanding defined contribution pension costs |
|
- |
- |
- |
|
|
Other creditors |
|
|
- |
- |
|
|
Accrued expenses |
|
|
- |
- |
|
|
Corporation tax liability |
109,180 |
75,376 |
- |
- |
|
|
Deferred income and fee deposits |
|
- |
- |
- |
|
|
|
|
- |
- |
||
|
Due after one year |
|||||
|
Other creditors |
|
- |
- |
- |
|
School fees are invoiced in advance; fees for the Michaelmas Term 2021 were invoiced prior to 31 August 2021 and accordingly are deferred at that date.
Deferred income and fee deposits (2020 - Other creditors) include deposits paid by parents of £1,825,250 (2020 - £2,271,425) which are repayable on 4 months notice (i.e. a school term) and classified as current as the school does not have an unconditional right to defer settlement of the liability for at least 12 months after the reporting period.
Deferred income and fee deposits (2020 - accrued expenses) include deferred income of £3,729,103 (2020 - £3,234,758) of deferred income for school fees paid in advance.
|
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 £
|
Share capital |
Allotted, called up and fully paid shares
|
2021 |
2020 |
|||
|
No. |
£ |
No. |
£ |
|
|
|
|
2,000 |
|
2,000 |
Northwood Schools Limited
Notes to the Financial Statements for the Year Ended 31 August 2021
|
Obligations under leases and hire purchase contracts |
Group
Operating leases
The total of future minimum lease payments is as follows:
|
2021 |
2020 |
|
|
Not later than one year |
|
|
|
Later than one year and not later than five years |
|
|
|
Later than five years |
|
|
|
|
|
|
Dividends |
|
2021 |
2020 |
|
|
Dividends paid |
- |
134,336 |
|
Secured debts |
The debts of the group are secured by a legal charge over the properties and a fixed and floating charge over the assets of the group.
|
Related party transactions |
Company
Summary of transactions with key management
The Northwoods Schools Partnership, which is controlled by Lady Colquhoun and Sir M Colquhoun Bt., provided management services amounting to £78,420 (2020 - £78,240) for the year on an arm's length basis. The group occupies premises owned or leased by the Partnership, and paid a market rent of £2,340,357 (2020 - £2,333,597) for the year. At 31 August 2021, the amount owed by the Partnership was £4,857,696 (2020 - £4,633,193).
|
Parent and ultimate parent undertaking |
Up until 20 September 2021, the company was controlled by the directors. From this date control passed to
The ultimate parent is