NATIONWIDE_COMMERCIAL_EST - Accounts

The director of the company has elected not to include a copy of the profit and loss account within the financial statements.true

For the financial year ended 31 October 2020 the company was entitled to exemption from audit under section 477 of the Companies Act 2006 relating to small companies.

The director acknowledges his responsibilities for complying with the requirements of the Companies Act 2006 with respect to accounting records and the preparation of financial statements.

The members have not required the company to obtain an audit of its financial statements for the year in question in accordance with section 476.

These financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.

Nationwide Commercial Estates Ltd is a private company limited by shares incorporated in England and Wales. The registered office is Glenfield Park, Philips Road, Blackburn, Lancashire, BB1 5PF.

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006 as applicable to companies subject to the small companies regime. The disclosure requirements of section 1A of FRS 102 have been applied other than where additional disclosure is required to show a true and fair view.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £.

The financial statements have been prepared under the historical cost convention,modified to include the revaluation of investment properties at fair value. The principal accounting policies adopted are set out below.

The company has long term bank funding in place and, on this basis, the director considers it appropriate to adopt the going concern basis in the preparation of these financial statements.true

Whilst the director has adopted the going concern basis set out above, the impact of the worldwide Coronavirus pandemic, Covid-19, on all businesses represents an uncertainty and the true impact of this pandemic will only become apparent over time.

At the date of approval of the financial statements the director is confident that the commercial and industrial investment properties sector continues to offer favourable investment and rental opportunities.

Revenue from contracts for the provision of professional services is recognised by reference to the stage of completion when the stage of completion, costs incurred and costs to complete can be estimated reliably. The stage of completion is calculated by comparing costs incurred, mainly in relation to contractual hourly staff rates and materials, as a proportion of total costs. Where the outcome cannot be estimated reliably, revenue is recognised only to the extent of the expenses recognised that it is probable will be recovered.

Investment property, which is property held to earn rentals and/or for capital appreciation, is initially recognised at cost, which includes the purchase cost and any directly attributable expenditure. Subsequently it is measured at fair value at the reporting end date. Changes in fair value are recognised in profit or loss.

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

The company has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the company's balance sheet when the company becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset, with the net amounts presented in the financial statements, when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets, which include debtors and cash and bank balances, are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

Basic financial liabilities, including creditors, bank loans, loans from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Equity instruments issued by the company are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the company.

The tax expense represents the sum of the tax currently payable and deferred tax.

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the profit and loss account because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the reporting end date.

Deferred tax liabilities are generally recognised for all timing differences and deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Such assets and liabilities are not recognised if the timing difference arises from goodwill or from the initial recognition of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

In a departure from FRS102 the director has not provided for deferred tax which may arise based on the carrying value of properties when compared to their historical cost.

If certain properties were sold at their carrying values a corporation tax liability would arise on the difference between the carrying value and indexed historical cost calculated at the corporation tax rates prevailing at the date of disposal.

The average monthly number of persons (including directors) employed by the company during the year was:

The investment properties are included at the director's valuation on an open market value basis. The historical cost of these properties is £2,979,748 (2019 - £2,979,748).

The bank loan is a government backed Bounce Back Loan for which no security has been given.

Other creditors includes £nil (2019 - £15,000) due to the director.

Included within bank loans is a government backed Bounce back Loan for which no security has been given. The total amount outstanding as at 31 October 2020 is £50,000 (2019 - £nil) which is included in creditors due within and due after more than one year.

The other bank loan is secured by a first legal charge over the company's investment properties. The company's bankers also hold an assignment of rental income on the above properties, and a personal guarantee from the director Mr M Patel, limited to £340,000, as security for the borrowings.

The revaluation reserve represents a non-distributable profits reserve.

During the year the company operated a loan account with a company controlled by the director's brother. At 31 October 2020 £1,257,692 (2019 - £1,282,295) was owed to that company.

During the year the company received management fees of £198,000 (2019 - £60,000) from an entity controlled by the director's brother. The company also received interest of £nil (2019 - £5,000) from a company controlled by the director.

The company also paid management charges of £20,000 (2019 - £186,000) to companies controlled by the director, and of £320,000 (2019 - £62,500) to companies and entities controlled by the director's brother.